"Oracle's offer of free support for Red Hat Linux was designed to inflict maximum pain on Red Hat. So it did. One day after the announcement, Red Hat shares lost 24 percent of their value. After watching his stock take a tumble, Red Hat's CEO Matthew Szulik is in a bind. He has just absorbed the equivalent of a cyber-kick in the groin from a bigger, badder bully."
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Member since:2006-10-24
WorknMan,
You're only considering one side of the equation and only seeing the challenges of open source business models and not the benefits.
You're forgetting that Red Hat doesn't write most of the code they support. They're a huge benefactor of code produced by _other_ people. So it isn't theirs to decide whether to "give" it away or not. They leverage that code, which they extend (and return to the community that gave them the code in the first place), and offer support on the result. It's a fair trade for them, and a good deal for their customers.
Now perhaps Oracle can compete with Red Hat and offer better or equal support at a lower price. But that's far from being an established fact. Even if Oracle does manage to get some customers, any patches they produce to improve the software can be snatched up by Red Hat! So Red Hat will get an improved offering paid for by Oracle. Gotta love the GPL.
Member since:2006-01-12
If I am proprietary, then I don't have competitors giving away my software, so I don't have to depend on support to drive profits
Again, RedHat did NOT write the whole software stack. They contributed to it, but so did IBM, Novell and many other companies.
My example was used to illustrate that software sales are just as unreliable (if not more unreliable) as support contracts. Even if a competitor doesn't have your code, they can still copy your idea. It doesn't even depend on the quality of the software: Big player can just bundle it to their flagship products and you are done for. The only way to guarantee this sale is through format lock-in.
OSS creates a level playing field by allowing everyone to have to same quality software. This means companies will be judged on the quality of support alone. They don't have to deal with bundling, lock in and other anticompetitive measures from their competitors.
Because somebody can easily come along and offer better support than you, and they wouldn't have the overhead of actually developing the software to begin with.
Actually, it's not as simple as that. The maker of the software will always have an advantage when it comes to offering support simply because they know their code. Considering that many support calls are non-trivial, this is a big advantage.
they'd usually only have to do support, along with maybe a few patches to fix bugs.
Your ability to fix bugs depends largely on your knowledge of the code.
Not only that, but if your main source of revenue was to charge for support, how inclined are you to make your software easy to use so that your customers don't even need support to begin with?
So you are of the opinion that with point and click, anyone can properly administer a mission-critical server? We are not talking about desktops that can be installed and reinstalled. We are talking about machines that have to run 24-7.
Edited 2006-10-30 00:39
Member since:2005-07-17
considering that Fedora, White box, and CentOS all have many users not getting RH support I'd say they do quite well at keeping themselves out of the support business unnecessarily. RH has thought quite hard about what people are willing to PAY for support, versus who wants Red Hat. They use the people that want it "FREE" as guinea pigs for their paying clients..
Paying for support is a huge deal for companies, RH charges per term, not by call.. it's in their interest NOT to have you call, that costs money. Companies expect to call with highly technical problems and to get the issue fixed, code patched in a limited time frame... THAT's what they're paying for, not the mythical "using" the software other vendors charge for.
Member since:2005-07-12
"Paying for support is a huge deal for companies, RH charges per term, not by call.. it's in their interest NOT to have you call, that costs money. Companies expect to call with highly technical problems and to get the issue fixed, code patched in a limited time frame... THAT's what they're paying for, not the mythical "using" the software other vendors charge for."
That's an outstanding point.
Oracle's, and Microsoft's, support is based on pay per incident. Therefore, it's in their (Oracle's and Microsoft's) best interests to put out buggy crap, so they can rake in more support dollars on their licensed proprietary product.
Red Hat's support is based on pay per term. They don't charge per incident. Thus, it's in their best interests to make sure their stuff works, and the customer is happy. Otherwise, RH loses money on the deal. And knowing that RH's entire business plan is based on supporting their Linux distro (and the distro itself is free), you'd think that going with Red Hat would be by far the safest, best choice, and by far the best value.
Stupid CIOs will chose Oracle support, being lured by the reduced up-front cost.
Smart CIOs will stick with Red Hat support.
Another important thing to consider is the fact that Oracle is supporting Red Hat Enterprise Linux, removing Red Hat branding. This is validating Red Hat Enterprise Linux, and Red Hat the company, and it's invalidating Oracle's own engineering.
Member since:2005-11-13
Member since:2005-12-31
Member since:
2005-11-13
And if they sell support (one of the few ways you can actually make money off GPL'd software) for cheaper than you do, and the support is good, then you're pretty much up shit creek without a paddle.
That's competition; being proprietary won't help much in this regard: Just look at how Apple screwed over small developers with Sherlock and Dashboard.
Actually, it would. If I am proprietary, then I don't have competitors giving away my software, so I don't have to depend on support to drive profits. IMHO, this idea of giving away software to sell support is not a smart business move. Because somebody can easily come along and offer better support than you, and they wouldn't have the overhead of actually developing the software to begin with. So, not only do you have to write the software AND provide support, they'd usually only have to do support, along with maybe a few patches to fix bugs.
Not only that, but if your main source of revenue was to charge for support, how inclined are you to make your software easy to use so that your customers don't even need support to begin with?