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Since announcing The Economic Impact of Red Hat Enterprise Linux: Trillions, Yes Trillions, of Dollars, a Red Hat sponsored study conducted by IDC, we’ve broken down the data in a variety of ways to take a hard look at the numbers, benefits and opportunities that flow from Red Hat Enterprise Linux (RHEL). The results of this research surpassed any expectations we may have had at the outset, and as we further analyze the data we continue to be impressed by how the world’s leading enterprise Linux platform impacts not only the tech industry but also local economies worldwide.
RHEL + local economies
We pointed out in our last post that by the end of 2019, it is expected that nearly 900,000 workers will be employed in the Red Hat Enterprise Linux ecosystem, with an additional 236,000 jobs predicted to be added through 2023. These figures include all employees in hardware, software, services and channels companies (not just the software engineers or programmers), and most of the additions are expected to be highly-skilled, high-paying jobs.
While some of these companies will be multinational, a majority will be locally-based, and as a result will be making investments in the regions in which they serve. These are investments in marketing, local offices, staff and services. All told, these investments should reach nearly $48 billion in 2019 to the benefit of local economies...but this is just the beginning.
Based on IDC’s calculations, the RHEL ecosystem is predicted to grow an estimated 11% a year from 2019 to 2023. Ecosystem revenue is estimated to grow to $119 billion in 2023 and local investment will grow to $69 million. By region, the RHEL economic footprint is fairly evenly distributed — 35% from the Americas, 33% from Asia/Pacific, and 32% from EMEA — helping to contribute to regional economies around the globe.
Additionally, IDC found that the use of RHEL by IT organizations could save those organizations nearly $7 billion this year. That money saved can be reinvested in other products and services - helping to further fuel local economies.
Lifting the upstream
In addition to The Economic Impact of Red Hat Enterprise Linux, IDC recently released the report "Worldwide Server Operating Environments Market Shares, 2018: Overall Market Growth Accelerates." The new research goes hand and hand with the economic impact of RHEL findings, and shows that Red Hat is the leading choice for paid Linux in the worldwide server operating environment market. The research found that enterprise Linux subscriptions grew by more than 14% in 2018, representing more than 33% of the total paid enterprise operating system environments. We believe that this report indicates that RHEL is the clear leader in the enterprise Linux world, and this continued build-up of the enterprise Linux server market is another driver for localized business spending and economic growth.
Like all of Red Hat’s products, RHEL is open source and developed from upstream community projects. In addition to the more direct economic impact of RHEL, Red Hat's contributions to downstream projects helps improve and sustain many projects used by the larger open source community, including Red Hat's competitors. These companies frequently rely on downstream projects when developing products - in that sense, RHEL not only helps lifts upstream projects, but also helps support the broader enterprise technology ecosystem by contributing to projects that other vendors build off of.
What’s to come
This is the first time Red Hat has taken a look at the impact RHEL has on the economy, but we don't intend it to be the last. Based on IDC’s calculations, RHEL’s reach and impact is only expected to grow in the coming years, with the ecosystem making more than $119 billion by 2023. RHEL provides not only an operating system that is the foundation for modern IT, but at the same time creates jobs and opens up millions of dollars in opportunity for the partners we work with.
About the author
Red Hat is the world’s leading provider of enterprise open source software solutions, using a community-powered approach to deliver reliable and high-performing Linux, hybrid cloud, container, and Kubernetes technologies.