Messages in this thread |  | | Subject | Re: business models [was patent stuff] | From | Gilad Ben-Yossef <> | Date | 28 May 2002 10:53:06 +0300 |
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On Tue, 2002-05-28 at 01:24, Larry McVoy wrote:
> If the free software community is ever going to really compete with the > non-free software community, they simply have to come up with a better > business model than giving it away and trying to make money on support. > It's economics 101 - a free market will go to whomever can provide the > needed service most cheaply. With no barrier to entry, that means as .........^^^^^^^^ > soon as the price gets high enough, someone will resell the > product for ..^^^^^^^ > less. Which results in razor thin profits, if any at all.
Software is not a "product" any more then a lawyer argument in a case is a "product" or an architect plan for a building is a "product". That's the whole problem in a nut shell. If you continue to view software as a sellable object then the business model indeed doesn't make sense. Then again, if you try to look at a lawyers argument in a case as the "product" of the law firm then that same business plan doesn't make sense either. After all, in most countries I'm aware of, a lawyer argument cannot be effectivly copyrighted. Of course, this doesn't stop lawyers from make a living. Just ask anyone at Microsoft legal depratment... ;-)
Most "Open Source service companies" that I'm aware off don't understand the implications. They're not built like a small law firm that may be large one day; they're built like a company that tries to be a 90 pound world class gorrila backed by Vulture Capital. Sorry, but it doesn't work like this: you have to walk before you can run.
So there's a business model and it works for years in other fields. Maybe the problem is that people this path is it isn't "sexy" - they will have to lose the dream of being High Tech millionares who built a megacorporation and start thinking like a small time law firm, which might one day be big. Maybe they don't like to work in a consultant kind of way. I can understand that and it's OK, but there is a business model.
The way Open Source (or Free) software works is to multiply the "use value" of software by killing the "sell value". But here is the interesting part: it increases the "use value" of the open/free software in a given niche, but kills the "sell value" of ALL software competing in that niche. This is why it's going to win, cold hard economic facts and no need for FSF like ideology (not that there's anything wrong with that... ;-))))
And BTW I'm OK with patents as long as their licensed for free to GPLed software (maybe add a clause that makes this irreversable?).
> How is Linux and open source ever going to be a leader, producing new > applications, new protocols, new languages, new markets when it doesn't > generate the incredible amounts of revenue needed to build all that?
A. Who cares? We're having fun. B. It already is in many senses.
I even think that A leads to B, but that's just me...
> Ask yourself - how much open source is a reimplementation of what has > already been designed and implemented, and how much is fundamentally new?
Ask yourself - how much science is a reimplmentation of what has already been researched and implmented, and how much is fundamentally new?
If I remember correctly Linus quoted some dead guy about this once, something about standing on the shoulders of giants...
OK, I'll now go back to being a quiet little lurker... ;-)
-- Gilad Ben-Yossef <gilad@benyossef.com> http://benyossef.com "Hail Eris! All Hail Discordia!"
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