Comments on: Why are the open source business people not ultra-rich yet? http://www.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/ Personal and professional development for technology professionals. Fri, 19 Mar 2010 22:48:21 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: Rajesh Setty http://www.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/comment-page-1/#comment-10131 Rajesh Setty Thu, 30 Jul 2009 20:16:44 +0000 http://www.blog.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/#comment-10131 Ghoti, Thank you for the comments but we both are talking about different things. I used to be the CEO of a company for five years that focused on helping implement open source solutions. I understand where you are coming from. I am talking about companies that generate revenues from open source software and services - not companies that use Open source for their business. Have a great week ahead. Best, Rajesh Ghoti,

Thank you for the comments but we both are talking about different things. I used to be the CEO of a company for five years that focused on helping implement open source solutions. I understand where you are coming from.

I am talking about companies that generate revenues from open source software and services – not companies that use Open source for their business.

Have a great week ahead.

Best,
Rajesh

]]> By: ghoti http://www.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/comment-page-1/#comment-10130 ghoti Thu, 30 Jul 2009 15:45:24 +0000 http://www.blog.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/#comment-10130 I disagree with the foundation of this argument. In fact of the 400 richest people (forbes) only 2 exclusively use proprietary software as a business model, and they sell that software. The other 398 and the companies they work for all run (primarily) open source solutions. I suppose you are correct in that selling FOSS won't get you rich, but then again it wouldn't be FOSS if it did. I disagree with the foundation of this argument. In fact of the 400 richest people (forbes) only 2 exclusively use proprietary software as a business model, and they sell that software. The other 398 and the companies they work for all run (primarily) open source solutions. I suppose you are correct in that selling FOSS won’t get you rich, but then again it wouldn’t be FOSS if it did.

]]> By: Anonymous http://www.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/comment-page-1/#comment-1637 Anonymous Thu, 26 Apr 2007 18:35:38 +0000 http://www.blog.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/#comment-1637 Rajesh, Interesting blog. Though I guess another way of looking at it is the Google perspective. Like the founders of Google, most geeks who are into open source are there to 'change the world' For them making money is an afterthought. And like google, a few will emerge ultra-successful. Rajesh,
Interesting blog. Though I guess another way of looking at it is the Google perspective. Like the founders of Google, most geeks who are into open source are there to ‘change the world’ For them making money is an afterthought. And like google, a few will emerge ultra-successful.

]]> By: Anonymous http://www.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/comment-page-1/#comment-1634 Anonymous Thu, 26 Apr 2007 07:18:01 +0000 http://www.blog.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/#comment-1634 Starting an open source company has more to do with passion than business. It is extremely difficult to sell and market open source products in an environment that is not aware of the power, stability and reliability of open source. To successfully run an open source company requires financial resources and more importantly employees with passion and the right skill set. I have been running an open source company for last seven years and personally think that it will take another three-five years to mature and have have industry-wide acceptability. And i am referring to the server side only and not the desktop. Starting an open source company has more to do with passion than business. It is extremely difficult to sell and market open source products in an environment that is not aware of the power, stability and reliability of open source. To successfully run an open source company requires financial resources and more importantly employees with passion and the right skill set. I have been running an open source company for last seven years and personally think that it will take another three-five years to mature and have have industry-wide acceptability. And i am referring to the server side only and not the desktop.

]]> By: Anonymous http://www.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/comment-page-1/#comment-1636 Anonymous Wed, 25 Apr 2007 12:22:04 +0000 http://www.blog.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/#comment-1636 The dear lord did produce quite a few ignorant fools. Producing OSS doesn't make one neccessarely rich. It is using OSS that saves money, there's where the benefit is. There's the shareholder's value: a company using OSS can produce more effeciently. OSS software is widely used. That is an observation. The Apache web server, for instance, does have a market share of around 65%. Linux is also widely used. The same goes for OpenOffice and Mozilla. Someone concluding from the lack of OSS billionares that OSS does not have a big impact yet does advertise himself as, sorry to say, an imbeicile: he is blind to reallity and shows himself to not to have the slightest clue on the subject he has a strong opinion on. BTW, that some producers of software have become rich can be attributed to the exploitation of a quite unique feature to software: the depance on a vendor's particular file format, protocols etc. (Vendor lock in it's called). The dear lord did produce quite a few ignorant fools.
Producing OSS doesn’t make one neccessarely rich. It is using OSS that saves money, there’s where the benefit is. There’s the shareholder’s value: a company using OSS can produce more effeciently.
OSS software is widely used. That is an observation. The Apache web server, for instance, does have a market share of around 65%. Linux is also widely used. The same goes for OpenOffice and Mozilla.
Someone concluding from the lack of OSS billionares that OSS does not have a big impact yet does advertise himself as, sorry to say, an imbeicile: he is blind to reallity and shows himself to not to have the slightest clue on the subject he has a strong opinion on.
BTW, that some producers of software have become rich can be attributed to the exploitation of a quite unique feature to software: the depance on a vendor’s particular file format, protocols etc. (Vendor lock in it’s called).

]]> By: Anonymous http://www.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/comment-page-1/#comment-1635 Anonymous Wed, 25 Apr 2007 12:08:14 +0000 http://www.blog.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/#comment-1635 There are other ways to make money, for example embedded systems and SAS (software as a service). Motorola/Nokia are making millions of dollars off from Linux based phones. Just about everything Dlink/Netgear/etc make is Linux based. Google is the pinnacle of SAS using open source software. Right now the big money isn't in the desktop. There are other ways to make money, for example embedded systems and SAS (software as a service). Motorola/Nokia are making millions of dollars off from Linux based phones. Just about everything Dlink/Netgear/etc make is Linux based. Google is the pinnacle of SAS using open source software. Right now the big money isn’t in the desktop.

]]> By: Anonymous http://www.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/comment-page-1/#comment-1633 Anonymous Tue, 24 Apr 2007 23:06:45 +0000 http://www.blog.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/#comment-1633 The main reason people have not gotten rich off FOSS is that source code availability is not for the sake of the producers, it is for the consumers. To get insanely rich requires control over the scarcity of a desirable consumable. There is no scarcity in FOSS. But a legitimate question is whether there is real value to society in allowing conditions that create the super-rich? I am against wealth redistribution, but that goes 2 ways. I believe that a legal environment which allows anyone to create false scarcity, resulting in wealth redistribution to a few privileged elite is harmful to society. This is why there must be laws to limit monopolies. Unfortunately, monied interests can control the political process to the detriment of society at large. One example of this is the abomination of software patents that the US PTO has foisted on us. The time and money wasted on fighting software patent battles has done nothing to help the economy or improve technology. It is only about grabbing more of the pie. The main reason people have not gotten rich off FOSS is that source code availability is not for the sake of the producers, it is for the consumers. To get insanely rich requires control over the scarcity of a desirable consumable. There is no scarcity in FOSS.
But a legitimate question is whether there is real value to society in allowing conditions that create the super-rich? I am against wealth redistribution, but that goes 2 ways. I believe that a legal environment which allows anyone to create false scarcity, resulting in wealth redistribution to a few privileged elite is harmful to society. This is why there must be laws to limit monopolies.
Unfortunately, monied interests can control the political process to the detriment of society at large. One example of this is the abomination of software patents that the US PTO has foisted on us. The time and money wasted on fighting software patent battles has done nothing to help the economy or improve technology. It is only about grabbing more of the pie.

]]> By: Anonymous http://www.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/comment-page-1/#comment-1632 Anonymous Sat, 21 Apr 2007 00:51:20 +0000 http://www.blog.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/#comment-1632 I think people need to remember distinguish between open source and free software. There are many companies that sell software but use open source code, IBM and EDS to name just two. I think people need to remember distinguish between open source and free software. There are many companies that sell software but use open source code, IBM and EDS to name just two.

]]> By: Anonymous http://www.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/comment-page-1/#comment-1631 Anonymous Wed, 18 Apr 2007 04:28:46 +0000 http://www.blog.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/#comment-1631 Open Source business models seems to be primarily about making money off services, while providing the base 'product' free. In a services model, the money you can make can scale only as the number of employees you have (assuming efficiency of workers is constant). Therefore you can't really make huge money, the way a product company can. You can however make money in the longer term, by getting more customers and keeping them longer than your competitors do. Of course proving that the service model works well, and making it work better than anyone else can, is called 'execution excellence'. And anyone who's interacted with VC's knows that 'execution excellence' is taken for granted, and not a 'sustainable competitive advantage'. Someone should show them an Ipod. If that's not execution excellence winning, I don't know what is. Open Source business models seems to be primarily about making money off services, while providing the base ‘product’ free.
In a services model, the money you can make can scale only as the number of employees you have (assuming efficiency of workers is constant). Therefore you can’t really make huge money, the way a product company can.
You can however make money in the longer term, by getting more customers and keeping them longer than your competitors do.
Of course proving that the service model works well, and making it work better than anyone else can, is called ‘execution excellence’. And anyone who’s interacted with VC’s knows that ‘execution excellence’ is taken for granted, and not a ’sustainable competitive advantage’.
Someone should show them an Ipod. If that’s not execution excellence winning, I don’t know what is.

]]> By: Anonymous http://www.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/comment-page-1/#comment-1630 Anonymous Wed, 18 Apr 2007 02:24:36 +0000 http://www.blog.lifebeyondcode.com/2007/04/15/why-are-the-open-source-business-people-not-ultra-rich-yet/#comment-1630 Thanks Cody. Open source is a philosophy and can be applied to things other than software of course. Best, Raj Thanks Cody.
Open source is a philosophy and can be applied to things other than software of course.
Best,
Raj

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