Hi Joe

On Mon, 2006-05-29 at 14:38 -0400, Joe Landman wrote:
> 
> The primary motivating factor behind business adoption of Open Source
> technologies and products is (from what we have seen and heard from our
> customers) the cost.  Free to them means free as in "free beer".
> Acquisition cost, and subsequent support costs are primary
> considerations in most cases.  Several (few) customers indicated that
> free as in freedom (e.g. the mission of FOSS systems) was a
> consideration, though when pressed a fair number of them indicated that
> they liked that it opened up the marketplace for them, without vendor
> lockin.  Customers and end users I have spoken to detest vendor lock in,
> and these days will actively seek to avoid it if possible.  So you get a
> balance between cost and freedom, and from what I have seen, cost
> usually wins.
> 
> Moreover, when we made specific changes (GPL released) which added
> significant performance value to various codes, and then asked people to
> pay (marginal rates) for them, their generalized immediate response was
> "why, as they are free, so I can just pull down your changes, build it
> myself, and get the value you are asking us to pay for".  This strongly
> dis-incentivizes us to continue this work.
> 

This is a very insightful email.

I think that the choice of area your product belongs to, and what your
product does also goes a long way towards influencing what you can make
on a free software product. Certainly MySQL and even Sleepycat (while it
existed) to an extent has shown that it is possible to make money while
remaining a free software business. Although I haven't included Red Hat
in this list, if I have to admire any one company in the world today
based on their freedom ethics, it'll be them. They are not ambiguous in
any way and do not `shift bases' from day to day. They have a
distribution whose binaries are closed, but the freedom of their
software is what makes projects like CentOS and Openfiler possible (I'm
sure even the CentOS camp acknowledges that). They purchased Sistina for
millions of dollars and released GFS as open source. Same with Netscape
directory server which they bought from AOL. The state of Linux itself
today has a lot to do with what Red Hat has done for it with respect to
code contributions in virtually the majority of the core packages which
make up a Linux distribution, and sponsorship. They have remained true
to their roots in being fully free(dom).

Cost of purchase and servicing definitely affects choices. From my
limited experience at a hardware and services company, I am seeing that
in "today's world" companies which care about long-term installations
are slowly trying to move away from vendor lock-in. They choose open
protocols and if possible, open implementations of such protocols.
Thankfully a lot of good quality software (if not the best among various
choices) is free software.

However, as free software also means that the software is free of cost,
if one wishes to profit from it, it becomes necessary to grow a service
business around it. In fact, with free software several such businesses
can exist around one product. That makes such a product more conspicuous
on a customer's radar as they know that they are not effectively the
victim of a single vendor but can be the victim of several vendors ;) by
having the choice to change the vendor if required. It also increases
competition among vendors (which is very good), which further increases
value of the services.

Giving users what they want (reasonably) in the end will dictate who
wins and who loses. If one doesn't satisfy the users, another will.

With respect to what you said in the end about how releasing something
for free and not getting any returns from it discourages you from
continuing such work, this is very much true. But again, in a free
software model, you CANNOT charge for the software, but need to add
services around such a model. In the case of certain software products,
it's impossible to achieve it if no viable services are possible, i.e.,
if the user can help himself and avoid expenditure (time/effort), he
will.

Mukund



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