It is a few years that it is known that the SHA1 Cryptographic Hash Algorithm is weak, and from 2012 NIST has suggested to substitute it with SHA256 or other secure hash algorithms. Just a few days ago it has been announced the first example of this weakness, the first computed SHA1 “collision”.
Since many years have passed from the discovery of SHA1 weaknesses and some substitutes without known weaknesses are available, one would expect that almost no software is using SHA1 nowadays.
Unfortunately reality is quite the opposite: many applications depend on SHA1 in critical ways, to the point of crashing badly if they encounter a SHA1 collision. The first to fall to this has been the WebKit browser engine source code repository due to the reliance of Apache SVN on SHA1 (see eg. here). But also Git depends on SHA1 and one of the most famous adopters of Git is the Linux kernel repository (actually Linus Torvalds created Git to manage the Linux kernel source code).
For some applications to substitute SHA1 with another Hash algorithm requires to rewrite extensively large parts of the source code. This requires time, expertise and money (probably not in this order) and does not add any new features to the application! So unless it is really necessary or no way to keep using SHA1 and avoid the “collisions” is found, nobody really considers to do the substitution. (By the way, it seems that there are easy ways of adding controls to avoid the above mentioned “collisions”, so “sticking plasters” are currently applied to applications adopting SHA1).
But if we think about this issue from a “secure software development” point of view, there should not be any problem in substituting SHA1 with another Hash algorithm. Indeed designing software in a modular way and keeping in mind that cryptographic algorithms have a limited time life expectancy, it should be planned from the beginning of the software development cycle how to proceed to substitute one cryptographic algorithm with another of the same class but “safer” (whatever that means in each case).
Obviously this is not yet the case for many applications, which means that we have still to learn quite a bit on how to design and write “secure” software.