Free Open Source Software is a modern term combining the idea of something being free as in cost or "gratis" and free as in freedom or "libre" when applied to software. Richard M. Stallman, Eric S. Raymond as well as many others have written extensively about these ideals.
Ideals and theory are all well and good, but the practical pragmatic advantages of FOSS is just as important. The nature of FOSS encourages competition by allowing each program or application to compete on merit outside of any particular company as well as creating an ecosystem where different ideas or implementations can be unleashed and when something works well, it is practically impossible to destroy. It is basically a meritocracy. Many good proprietary software programs have been left to decay once their commercial companies folded or lost interest in the product. The term "abandonware" has been coined to describe these programs.
The interesting thing about FOSS is that practically everybody is already using it and have been for some time. Sendmail, qmail, and other FOSS is responsible for much of the email that gets sent worldwide on the Internet. The Apache Software Foundation's httpd server powers the majority of the world's web sites according to Netcraft:
http://news.netcraft.com/archives/web_s
FOSS has also enabled many new companies to quickly implement new ideas which speeds innovation and progress. Google uses the Linux operating system, not Microsoft Windows, on their massive server farms, Yahoo uses the FreeBSD operating system. Up and coming companies such as
Facebook has leveraged FOSS to quickly get into market:
http://developers.facebook.com/opensour
MediaWiki, the software that powers Wikipedia is FOSS:
http://en.wikipedia.org/wiki/Wikipe
which is a spiritual successor to WikiWikiWeb, the first wiki application initially made in 1994. The Linux or GNU/Linux operating system can be found on devices ranging from small devices such as wristwatches and cellphones to netbooks and laptops, on many servers, up to mainframes, and the majority of the top 500 supercomputers in the world:
http://www.top500.org/stats/list/32/osf
Weta Digital, creators of the incredible special effects for the Lord of the Rings trilogy makes heavy use of the Linux operating system as well as the Python programming language:
http://www.wetafx.co.nz/jobs
Apple makes extensive use of FOSS in their flagship operating system OS X:
http://developer.apple.com/opensource/
There are FOSS programs for almost every conceivable application ranging from databases such as PostgreSQL and MySQL to 3D animation programs like Blender:
http://www.blender.org/
GIS (Geographic Information Systems) software such as GRASS (originally Army corps of engineers)
http://grass.osgeo.org/
OpenOffice.org is a fairly complete productivity suite:
http://www.openoffice.org/ or
http://www.neooffice.org/ for a better integrated Apple Mac OS X version.
Among the many US government, military, and educational institutions that have embraced FOSS are:
NASA http://www.nas.nasa.gov/Resources/Softw
the DoD (Department of Defense)
http://arstechnica.com/news.ars/post/20
and the NSA (yes, that NSA):
http://www.nsa.gov/research/selinux/
Even video games use FOSS. Crayon Magic, used the Box2d engine:
http://www.box2d.org/
which is FOSS.
There are many large commercial companies that have embraced FOSS:
IBM http://www.ibm.com/developerworks/opens
Intel http://software.intel.com/sites/oss/
AMD or ATI http://www.amd.com/us-en/Corporate/Virt
HP http://h71028.www7.hp.com/enterprise/ca
Nokia http://opensource.nokia.com/
Dell http://www.dell.com/linux/
Sun Microsystems http://www.sun.com/software/opensource/
Oracle http://oss.oracle.com/
Sony products including cameras, and the PlayStation 2 and 3.
http://www.sony.net/Products/Linux/
Netgear
http://kbserver.netgear.com/kb_web_file
There are many groups aside from technical ones that have also adopted FOSS. From small commercial companies like Ernie Ball, manufacturer of guitar strings and other accessories:
http://news.cnet.com/2102-1082_3-506585
to municipalities like the city of Munich, Germany:
http://software.silicon.com/os/0,390246
national government institutions like the French Police:
http://www.webinfrance.com/police-franc
or entire countries like Brazil:
http://news.bbc.co.uk/1/hi/business/344
or Vietnam:
http://english.vietnamnet.vn/tech/2
Even though FOSS has been in the background quietly serving for many years, it has only recently begun to gain a foothold in the minds of the general public. Even though the Mozilla Firefox web browser is one recent application that has popularized FOSS, the reputation of FOSS has been tarnished by some commercial companies such as Microsoft which has called it a "cancer":
http://www.theregister.co.uk/2001/0
The irony or perhaps hypocrisy is that they have switched their websites and windows update servers to Akamai who use linux exclusively on their servers.
http://news.zdnet.co.uk/software/0,1000
Microsoft has also claimed that Linux violates over 200 patents:
http://money.cnn.com/magazines/fort
though Microsoft still has not named them. The patent violations seem highly unlikely as Linux runs on far more hardware platforms than Microsoft Windows.
They also have used BSD code in their ftp.exe client and other utilities that ship with Microsoft Windows for some time. FOSS is also in their Services For Unix product. In addition Microsoft used MIT Kerberos as the basis for their Active Directory product. Recently even Microsoft has started to quietly push FOSS to developers:
http://www.microsoft.com/opensource/
Although FOSS has many advantages, adopting FOSS is not an automatic panacea solution. It may have no direct monetary cost, but there can be costs in training or retraining personnel, time searching for solutions or customizing software that may not fit specific needs perfectly. Even so, Free Open Source Software is the quiet juggernaut that will not be so quiet in the 21st Century.