Linked by Thom Holwerda on Wed 29th Mar 2006 21:51 UTC, submitted by SilentBob4
Linux "This is the second in a series of two articles on Tux's move into retail. Last week's article described some of the mechanics of how free open source software is getting into retail. Today, Mad Penguin interviews Linspire CEO Kevin Carmony; Xandros CEO Andreas Typaldos; Mepis Linux founder Warren Woodford; and Kevin Jones, Micro Center Vice President of Merchandising, to get their take Tux's jump into big box retail."
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RE: warren woodford
by davidiwharper on Thu 30th Mar 2006 09:55 UTC
davidiwharper
Member since:
2006-01-01

It takes a lot of time and man hours to get a product into channel.

Warren is also dead on when he says it costs a lot of money.

A few years ago I tried to get a tech product into a distribution network, and the prospective distributors had three questions:

(1) How much money (millions of dollars) will you put into marketing?
(2) Will you take back all the stock we don't sell (and pay us back for it)?
(3) What is the 24/7 dedicated technical support phone number?

For a one man operation none of these questions can be easily answered.

As a side note, I also had some dealings with Manaccom (http://www.manaccom.com.au), who distribute Trend Micro consumer products in Australia, about the same product. They have a clever (for them) system: they pay you a small (10%-15%) cut for every box sold at retail. A one man operation would go broke waiting for enough money to pay the bills from a "deal" like that!

Apparantly the only way Trend makes a decent amount of money out of Australia is by selling on-going subscriptions in the second and third years. This is because they net 100% of the proceeds as the renewal process is entirely electronic and Manaccom is not involved.

To relate this to Linux: Manaccom also distribute Linspire, for which the same is no doubt true - while Linspire might not make much money on initial sales they would make a fair amount on Click-n-Run subscription renewals. The good news for Linspire is that as they aren't involved in production they don't have to dedicate millions of dollars to the closed Australian market. The bad news is that they probably had to agree to share the revenue with Manaccom like they do with their Gold Builder program (http://www.linspire.com/builder/builder_homepage.php) -- I can just hear the Manaccom execs demanding this as the price of entry...

All in all, getting any tech product (and especially Linux ones) into a channel is a big ask.

Edited 2006-03-30 09:58

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