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OPEN SOURCE SOFTWARE. Business Models. Kevin Randall Jeff Grabeel Wil Satterwhite. O S S. Definition. O S S. Free redistribution. Source code included. Allows modification and derived works. Derivatives must be allowed to follow the OSD. MODEL: Support Sellers. Support Sellers.

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OPEN SOURCE SOFTWARE

Business Models

Kevin Randall

Jeff Grabeel

Wil Satterwhite

O S S


Definition

O S S

  • Free redistribution.

  • Source code included.

  • Allows modification and derived works. Derivatives must be allowed to follow the OSD.


MODEL:

Support Sellers

Support Sellers


Definition

Support Sellers

  • Companies that sell

    Support & Goods


Making Money

Support Sellers

  • The 2 Ways

    • Physical goods, e.g., media and hard-copy documentation like books and CD’s that the free software is on.

    • Services, e.g., technical support, contracts.


Major Players

Support Sellers

  • Cygnus

    • First Mover 1989

    • Founders

      • John Gilmore,

      • Michael Tiemann

      • David Henkel-Wallace

  • Job

    • Commercial support for “Free Software”

  • 1999

    • Merged with Red Hat


  • Major Players

    Support Sellers

    • Caldera

      • Now under the name SCO Group

      • Founded in 1994 by Bryan Sparks

      • Made money mostly distributing Linux

      • Since its creation, Caldera has been involved in many lawsuits against many organizations including:

        • Microsoft, Red Hat, Autozone, Daimler - Chrysler


    Major Players

    Support Sellers

    • Red Hat

      • Most well known Company

      • Founder

        • Marc Ewing 1994

    • Went Public

      • in 1999

  • Largest Supplier of

    • GNU/Linux operating Systems


  • Major Players

    Support Sellers

    • Red Hat

      • The Fedora Project

        • The Fedora Project is a Red Hat-sponsored, community-supported open-source project. Its stated goal is to promote the rapid progress of free and open-source software and content, and its rapid innovation is possible using open processes and public forums.


    Major Players

    Support Sellers

    • Red Hat

      • Sells

        • subscriptions to the support, training, and integration services that help customers in using the open source software.

          • 24/7 customer support

          • One set Price


    Major Players

    Support Sellers

    • Red Hat

      • Initial Public Offering (IPO)

        • 6 million shares

        • $14/share

          • Total of $84 million Dollars

    • Business Model

      • The market doesn’t know what to do with Open Source phenomenon. This is causing volatility to show in the stock charts.


    Major Players

    Support Sellers

    • Red Hat


    MODEL:

    Widget frosters

    Widget Frosters


    Definition

    Widget Frosters

    • In this model, a hardware company (for which software is a necessary adjunct but strictly a cost rather than profit center) goes open-source in order to get better drivers and interface tools cheaper.


    Linux Certified

    Widget Frosters

    • Pre-loaded with Red Hat/Fedora or Ubuntu Linux. Linux distribution CDs included. Optional Dual-Boot Install with Windows XP

    • “No Windows Tax! Most laptops come with built-in cost of Windows, regardless of whether you want to use Windows or not. LC2000 series is free of any such baggage. You only pay for Windows if you want to use it.”

    • LC2000 Series Linux Laptops


    Los Alamos Computers

    Widget Frosters

    • LACLinux

    • based in Los Alamos, New Mexico USA

    • Started in September, 2000

    • Offers workstations, portable systems, laptops and servers

    • Can choose Ubuntu, Debian GNU/Linux, Red Hat/Fedora Core, Slackware Linux, SuSE Linux, Red Hat Enterprise Linux, and Microsoft Windows XP or Vista


    IBM

    Widget Frosters

    IBM

    • The entire IBM Systems product line is Linux enabled

    • Accessible to any size business

    • Linux Technology Center

      • Team of IBM open source software developers who work in cooperation with the Linux open source development community


    MODEL:

    Accessorizers

    Accessorizers


    Definition

    Accessorizers

    With accessorizing, companies sell anything related to OSS.

    From computers programmed with open source software and books on open source software at the high end.

    To t-shirts, mugs, dolls and mints at the low end.


    O’Reilly Media

    Accessorizers

    • Website

    • “Since 1978, O'Reilly has been a chronicler and catalyst of leading-edge development, homing in on the technology trends that really matter and spurring their adoption by amplifying "faint signals" from the alpha geeks who are creating the future.” – O’Reilly Media

    • Sells Training materials, books, magazines, conferences, on-line services, t-shirts, coffee mugs, and more.

    • Started out as O’Reilly and Associates as a technical writing consultant company.

    • In 1984, started retaining rights to manuals they created.

    • “We weren't afraid to say in print that a vendor's technology didn't work as advertised” – O’Reilly Media

    • Became an early user of the internet, pioneers in putting books online and selling subscriptions to their library.

    • In 1998 O’Reilly Media hosted a meeting/conference known as the Open Source Summit. A few years down the road they added the Open Source Convention (OSCON)

    • In 2005 They came out with Make, a magazine devoted to do-it-yourself technology projects.


    SourceForge,inc.

    Accessorizers

    • WebsiteNetwork

    • President and CEO Ali Jenab

    • Provides information exchange, goods, and open source software distribution and services.

    • Provides news, original articles, downloadable resources, and community forums.

    • World’s largest website for open source software development.

    • Hosts open source software development projects, more than 100,000.

    • Links users, over 1,000,000, with resources for managing projects, communication, issues, and codes.

    • Largest repository of open source codes and applications on-line.

    • Also owns ThinkGeek, which sells items from fun gadgetry to computer accessories to apparel


    SourgeForge, Inc.

    • Initial IPO up around $300/share in December of 1999

    • By mid-March LNUX was down to $100/share

    • And in mid-December of 2000 they were selling for under $10/share

    • Currently trading @ $4.28/Share


    MODEL:

    Loss Leaders

    Loss Leaders


    Definition

    Loss Leaders

    • A loss leader gives open sources a piece of software to increase their market position for another closed source product.

    • One example is Netscape

      • open source of their Navigator web browser to increase name recognition for the web server products they sell


    The End

    O S S


    Bibliography

    • http://www.opensource.org/advocacy/case_for_business.php

    • http://laclinux.com/en/Start

    • http://www.linuxcertified.com/

    • http://www.ibm.com/us/

    • http://hecker.org/writings/setting-up-shop

    • http://en.wikipedia.org/wiki/Red_Hat


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