David, I think you may have answered the "How do we pay the piper?"
question here:
I'd beg to differ with Lynn that this stuff is only for the big boys - like
Adobe, IBM, Google or Yahoo. The developers of Base Camp have a good
business, they build upon the developer community they created with Ruby on
Rails. They get a lot of work. Nor did they need to raise heaps of cash to
get there. If I had a vote - I'd at least be seriously exploring moving over
to that sort of model - together with dual licensing for companies wanting
closed source solutions for their customers.
Business models are adapting to these new forces, and while they are not
sorted out yet - where there is dirt there is money.
The folks at Base Camp have visibility, but do revenues match? It isn't
hard for any services company to be booked to capacity, but the
challenge with services is that revenue is capped by the number of hours
in a day. The relative ROI for software products is much higher, with
no human resources constraint on revenue.
But your note reminds me of one overwhelming success: MySQL.
I have to admit that it would have been inconceivable for a small
organization like MySQL to get a larger installed base than Sybase and
Oracle without their dual licensing.
A very carefully chosen license (hopefully more clearly communicated
than MySQL's) might well be the ticket for Rev.
Enforcement is a difficult thing with dual licensing, and I'm not sure
how one would go about it when the source is freely available without
relying primarily on litigation. Litigation is perhaps the most costly
form of license enforcement. :)
Some open source projects only make the source available if you apply
for it, which may be optimal since it introduces an accountability
otherwise absent when sources are freely downloadable.
But you may be onto something here. A dual license explodes the market
for services, while protecting revenue with the market segment that's
most profitable anyway, the commercial developer.
With development tools like Rev support costs are disproportionately
higher than with simpler consumer apps, and costs to support
professionals tends to be much lower than for less experienced
developers. This means that under the current model Media customers are
the most expensive sale with the lowest ROI, making the segment worth
addressing solely on the hope of numbers large enough to offset the costs.
But under a dual license, those looking for free stuff simply don't get
support from the company, and those who need support would pay for it
directly. Low-end customers looking for support would turn to things
like this list, where consultants are motivated to provide support for
free for the visibility.
So a dual license might well preserve the highest-ROI customers while
trimming the lowest-ROI, all the while exploding market share beyond
what even a million-dollar marketing budget could hope to accomplish for
a purely proprietary product.
Hmmmm..... Thanks for posting that, David. Much to think about....
--
Richard Gaskin
Managing Editor, revJournal
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