Software-defined vertical industries: transformation through open source

Investment Rating - The report does not explicitly provide an investment rating for the industry Core Insights - The report emphasizes the transformation of various vertical industries through open source collaboration, highlighting the shift from traditional proprietary systems to user-centered innovation models that enhance development speed and interoperability Overview of Key Points - Major industries such as banking, telecommunications, and energy are increasingly dependent on open source software, integrating it into their R&D and development models to drive innovation [5][6] - A McKinsey & Co. report indicates that top-quartile companies adopting open source see three times the impact on innovation compared to their peers [7][14] - The Linux Foundation has expanded significantly, supporting hundreds of distinct project communities across various technology domains [8] Telecommunications Industry - The telecommunications sector has seen rapid innovation due to open source, moving from proprietary systems to software-defined networking [16][18] - LF Networking (LFN) has become a leading open source organization, with over 70% of global subscribers relying on its projects, which have contributed 78 million lines of code valued at over $7.3 billion [20] - AT&T has played a pivotal role in this transformation, advocating for open source collaboration and releasing its platform for industry-wide use [21][24] Automotive Industry - The Automotive Grade Linux (AGL) initiative aims to reduce fragmentation in automotive software by creating a unified open source platform supported by major manufacturers [53][54] - AGL addresses the need for modern user interfaces in vehicles, reflecting consumer expectations shaped by technology [44][46] - The initiative has gained support from leading automotive manufacturers, leading to its deployment in production vehicles [55] Motion Pictures Industry - The Academy Software Foundation (ASWF) was established to foster collaboration in the motion picture industry, addressing the challenges of fragmented software infrastructure [56][59] - ASWF promotes open governance and a neutral forum for studios and vendors to collaborate on open source projects [60][63] - Key projects under ASWF include OpenVDB, OpenColorIO, and OpenEXR, which are critical for visual effects and animation in major films [64][67] Financial Services Industry - The Fintech Open Source Foundation (FINOS) has emerged as a collaborative platform for financial institutions to adopt open source development [75][78] - FINOS has facilitated contributions from major banks, enabling shared development of common software components and reducing costs [81][82] - The foundation aims to create a "build once" approach to financial technology solutions, enhancing interoperability and compliance [83] Energy Industry - LF Energy was created to address inefficiencies in the energy sector and promote open source collaboration for digital transformation [99][100] - The energy industry faces significant challenges, including high carbon emissions and the need for a more efficient power grid [92][95] - LF Energy's mission includes building shared digital investments to transform energy systems, with several ongoing projects aimed at improving utility operations [101]