“Even though all of us here at MandrakeSoft are excited about the upcoming release, we’ve also been distracted by financial concerns. Despite continuous good reviews in the press; despite having millions of users throughout the world; despite producing an award-winning Linux distribution that is a solid competitor to both UNIX and Window$, the Mandrake Linux distribution’s short-term future is in jeopardy due to a simple factor: money.” Read the rest of the article at Mandrake’s own web site. IMNSHO Commentary: After the comically tragic news about the end of Loki Games which apparently did not pay some employees since end of 2000 and “a single employee is listed in creditor filings as being owed almost $350,000 in unpaid salary and in expenses the company incurred using the employee’s credit card” and many other Linux companies in the past, now is Mandrake’s turn to have money trouble. Except Red Hat Linux (who are specifically targetting servers and the Enterprise market instead of desktop users), none of the “desktop” Linux-oriented companies makes real money or even survived the… GPL (you can argue as much as you want about that – be my guest).
Linux Mandrake in Financial Trouble?
About The Author
Eugenia Loli
Ex-programmer, ex-editor in chief at OSNews.com, now a visual artist/filmmaker.
Follow me on Twitter @EugeniaLoli
With all due respect to the wonderful OS called Linux, I do not see it surviving as a desktop OS unless some serious cash is being exchanged. Linux works as a server OS because companies like Red Hat can make a small profit from providing tech support and other services like training and what not. In the desktop markey, more revenue comes from software sales, despite all the pirates and people simply sharing software.
In regards to the GPL, I like the fact that it allows me to pick and choose what software I want to use, and get rid of ones I don’t want, unlike M$ shoving proprietary software down my throat. But I can’t support it if I can’t make money for my effort. I’m not a greedy person, I’m a PERSON who eats and sleeps. I feel sorry for that guy that let Loki use his credit card, but he should have known better.
Honestly I don’t see how this has anything to do with the GPL. I personally don’t like the license, I’m more of a BSD/MIT license type. However, the GPL does allow for per seat licensing [you still must *distribute the source* with each copy. There is nothing stopping your installer from being closed source. Conversely there isn’t anything stopping the client from recompiling from the source, but most really don’t want to do that].
This is more an issue of Mandrake handing out full version ISO’s, if mandrake would quit doing such and move more towards the business model of SuSE/[former]BeOS (allowing downloading iso’s that aren’t full versions) or even OpenBSD (cvs tree is openly accessible, iso’s aren’t) they’d probably last longer. Current business model provides no incentive to buy from MandrakeSoft, I’d much rather pay cheapbytes or another iso resaler 5 bucks plus shipping if I can’t afford to download/burn it myself than go to CompUSA and buy it.
There’s nothing wrong with the GPL, but when someone decides giving their full product away is a great idea ™ they are out of their mind.
It has nothing to do with the GPL. It has everything to do with a sound and working business plans! So Eugenia, your IMNSHO commentary is really… crap
Maybe the Loki employee who let them use his credit card knew full well he’d never get repaid. Some people love their jobs, their company, etc., and if they can afford it, gladly invest in them with the hope that someday it’ll work out, but the knowledge it also may not.
It has nothing to do with the GPL. It has everything to do with a sound and working business plans! So Eugenia, your IMNSHO commentary is really… crap
Actually, it has everything to do with the GPL, because it appears that no one’s having much luck finding a sound and working business plan that works with the GPL for Linux on the desktop. Perhaps someone will in the future, but to date the sound and working business plan has been to abandon the desktop and focus on providing services to enterprise customers.
it has everything to do with the GPL…
Hehe, wrong. An important component for the desktop, X11, is not even licensed under the GPL! If companies can’t figure out how to sell free (as in free beer) stuff it’s their problem, it’s as simple as that. Don’t blame the GPL for that 🙂
“It has nothing to do with the GPL. ”
Well, there’s a very (VERY) few GPL’d company that ‘survive’. Until I don’t see major success in this field, I’ll believe the open-sourced business format is responsible.
From my point of view, Open Source business and Communism are exactly the same: on paper the idea is absolutely great and positive. But when it’s time to apply in the real world, both are messy craps.
Hehe, wrong. An important component for the desktop, X11, is not even licensed under the GPL! If companies can’t figure out how to sell free (as in free beer) stuff it’s their problem, it’s as simple as that. Don’t blame the GPL for that 🙂
Fortunately you missed an even bigger point, that I said Linux for the desktop, and the Linux kernel is under the GPL. I happen to believe that Linux would be better off on the desktop without X11, but that’s another argument. You can’t have Linux on the desktop without the Linux kernel, and therefore you have the GPL.
We could argue all day whether or not it’s ‘free’ software that’s killing companies going for the desktop or whether it’s the GPL specifically, but, in the end, the simple issue is that companies don’t seem to be capable of coming up with a business plan that works to put Linux on the desktop, and that the GPL has a part in that. If people can’t figure out how to sell ‘free’ software, then the GPL is still covered within that.
In the end, is ‘free’ software going to die because people can’t make money off of it? No. Is it going to progress as a desktop OS as quickly as it could? That’s debatable. It’ll get there eventually with or without monetary support.
there will always be some people who will say open source/free software is blah blah blah great!
the only way to convince them otherwise is just wait until all the OSS/FS companies die and only 2-3 remain and then we can say “We told you SO!!!”
Right. This time, rather than downloading, I buy it.
It’s a great distro, and it’s worth the investment.
I don’t know why Mandrake didn’t see this coming. They, along with a few other companies, give away everything for free. If I bought Linux and had the books, it still wouldn’t be any less confusing to me than when I download ISO’s and do tech support research on websites.
I really think Linux servers are the way to make money with Linux at the moment. Maybe someday Linux desktops will be a viable business, but not now. In the short term, Windows has implanted itself to deeply into the home user’s experience.
Besides, how many companies do we need bundling together a linux distrobution and trying to sell it? I’ve played with Mandrake, Red Hat, Suse, and a few others just for the hell of it and none of them were radically different from the other. I preferred Suse the most, but I could have easily made due with any of the distro’s I’ve tried.
Maybe lycoris and suse will emerge and go head to head. But the bottom line is that they have to start charging (well, Suse already does in a way) to stay afloat and improve their product. Of course this might alienate the hoards of Linux users who don’t want to pay for an OS.
My off-topic contribution:
From my point of view, Open Source business and Communism are exactly the same: on paper the idea is absolutely great and positive. But when it’s time to apply in the real world, both are messy craps.
I would submit that anyone who believes Communism is good on even paper has some serious thinking to do. It sounds “nice” and “good” and “happy” in many ways, but goes completely against the very nature and morality of man. Capitalism (and I don’t mean the half-capitalist, half-other systems mishmash like we have in the U.S., but pure Captitalism, defined as a social system in which individual rights are upheld [and nothing more]) is clearly the only moral system.
There’s nothing inherently wrong with the GPL. People who write code are of course free to license it however they choose. But groups like Mandrake are trying to build a business around Linux on the desktop, and despite their many noble efforts, Linux just isn’t ready for it. Maybe in a few years, maybe not. This is hardly news (except to a few people who claim that KDE is “just as easy” as Windows). A desktop systems needs to “just work” the vast majority of the time, and that’s just not the case right now. Maybe if these companies can hold on for a few more years, things will be different; I’m not quite sure.
The GPL isn’t always a drop-in replacement for closed-source software. Big deal. Understanding when any licence is best suited is what’s best. The software use dictates the licence. Imposing a poor-fitting licence on any software will doom it and this has nothing to do with the GPL.
Firstly, Mandrake couldn’t provide what they do without the GPL. What they sell is comprised of 99% other people’s work. So that they were able to sell other people’s code is to the benefit of the GPL.
If Mandrake were to come out tomorrow and say that they were to provide desktop software for all of the French Government over 5 years the GPL wouldn’t stop it. If this were to happen this would be due to smart management, not any licence, and Mandrake would have fat pockets.
You have no evidence to support your statement Eugenia. Most alternative desktop operating systems have also died.
The problem is rather the amount of distributors than the GPL.
If there was only ONE commercial linux distribution for desktop users, it would probably survive easily. Ie if SuSE, Lycoris, Redhat etc gave up on desktops Mandrake probably would survive due to the user boost.
Selling Linux is way hard, even for RedHad. Regarding Mandrake, I don’t understand their business plan, you can have a downloadable copy and a boxed one. I know of the *value added* of the later, but that just can’t be commercially viable, think that a Libranet Linux 2.0 has about the same price with much less inside; Libranet used to mail you one CD, now two, a 2 paper guide, support and that’s it, and you can’t download Libranet (the latest version), that’s more rational economically.
The only Linux distros I have bought are Libranet1.9.1 and Slackware7.1 (boxed), although I could have got Slack for free. Linux companies that target the desktop have to forget a little about selling services and start to think much more about adding lots of application value, specially developing them if they have the potential Mandrake has. And then sell it, giving it away obviously doesn’t work.
I don’t get completely what’s their game with the Mandrake Club, if you’ve got what it takes just sell it!
I guess I’m `obsessed` with the coming of Xandros Linux, as this news reminds me of the interview ConsultingTimes has with Xandros President Michael A. Bego.
CT: Everyone’s looking for a business model these days. Can you give a brief description of Xandros’ business model, and tell us how it will succeed where others have failed?
Bego: In the first place, the framework of what Xandros is offering is important to consider. We’re not just offering software. We’re offering a complete and simple solution, and we’re also offering support in the form of end user support as well as professional services to allow us to work better with resellers and OEMs.
So we have three value adds — one is the technologies, two is the ability to go to different markets with professional services, and three is support via call-in and also via updating technologies.
In terms of making money, we’re anticipating making money initially directly off unit sales — to direct end users, to OEMs, and through resellers. In addition to unit sales, we’re planning on subscription revenues from ongoing use of dynamic updating technologies that will be embedded in the distribution. The final source of income will be from professional services.
…
They better concentrate on the first one, the technology, and sell well those unit sales, because seems like every Linux desktop keeps failing with the rest of values. They better start soon too, because although not still out, Xandros <a href=”www.xandros.com”>website is pathetic, miles behind <a href=”www.mandrake.com”>Mandrake’s.
Please do not provide false news: Mandrake is extremely well received in the industry because they release an OS which is extremely well suited for company needs: powerful, stable, cheap and… easy to use. See http://www.mandrakebizcases.com if you disagree with me. Furthermore I’ve been looking at MandrakeSoft, SuSE and RedHat much these last years and I have to say MandrakeSof’s strategy is very intelligent by the way they get more and more users everyday. They are really like Debian in many ways and I guess that if they’d done an hot IPO like Red Hat did (and so reached break-even fast by external growth, understand: buy companies that already make profits), they would currently be bigger than Red Hat. MandrakeSof’s current troubles are IMHO not linked to a bad potential or bad business plan. Their strategy is bright, but long-term, which is hard in these tough days.
Can someone explain me why one would work for months for
a company which doesn’t pay at the end of the month ?
My off-topic reply:
“I would submit that anyone who believes Communism is good on even paper has some serious thinking to do.”
I really do think communism is great on paper. This is the same story as the dark side of the force. Very charming, quick and easy for a country in distress (economicaly and socialy), but in the end you lost. You always lost.
By exemple, I take Star Trek universe that I considere very close to communism (no properties, no salaries, we work for the advancement of the human race, etc). I strongly believe that will never happen. IMHO, you can’t grow without competition. Period.
So don’t misunderstood me. I’m a fierce defender of the capitalism system because I think it’s the fair one. But communism on paper is more poetic, more human spirited.
Like Open Source. (just to return in the thread topic
gfx: Not wanting to throw away a bad investment of your time. Feeling close to the product you made even though it’s not controlled by you. Lies work.
After http://www.kuro5hin.org/comments/2001/4/26/153853/420/31#31“>bei… I’ve come to think of it like battered wife syndrome
It’s all promises, and it’s all thinking what made you like it in the past was still there.
Is it just me or are the authors here at OSnews getting more and more biased against anything not M$, especially linux? sheesh!
I used Mandrake for 6 months in my last job, It was a nice system but I’ll admit I never paid for it, I just downloaded the ISOs cut them and installed. They had on line support and stuff but I didn’t really need it.
I’m currently using RedHat 7.2 (J2EE development on a 150MHz Cyrix – yea, I can take the pain!) and It’s for the most part just as easy to use but Mandrake did have 2 apps for administration which I would love to have on RedHat. One was for Installing apps and another was for administrating services, there’s maybe equivalents in RedHat but I can’t say I’ve found them yet.
I did however buy RedHat, I could probably download an ISO but RedHat have always been smart in this aspect, they will make them available but you have to go and dig for them, they comply with the GPL but don’t exactly advertise the fact. (Actually,in this case it was cheaper and quicker to buy a box than do a 56K modem download…)
I have to agree with Eugenia that the GPL effectively makes business impossible. It only works where you can make money off additional services.
>You have no evidence to support your statement Eugenia
Nonsense.
How many companies exist that are actually making money out of GPL’d software? don’t say IBM – they make their money from hardware.
I think you’ll be hard pressed to find *any* companies making money this way without selling something else. Thats your evidence.
<blockquote>How many companies exist that are actually making money out of GPL’d software?</blockquote>That’s your evidence? Stop it, you’re making me laugh!
About a year ago, the Linux hype was piled so high that my technology-blind father actually referred to it. This man knows NOTHING about technology, especially computers. There he was asking me “isn’t there a free Windows called… lu… li…linni…L something?” I said “Holy crap, the Linux hype machine has reached my father!!”
Everyone and their dog expected to make a quick buck on the new buzzword “Linux.” Why? It was FREE, man!! The cliche “jumping on the bandwagon” rolled around in my head whenever I read any tech news. The press was one big fat “Me Too!” robot with their pointless Linux-stroking articles.
Everyone had something to sell that was Linux-related. Everything was possible with Linux. Linux was the answer to all computing needs. Linux was FREE, man!! You could modify it if you wanted to (IF you wanted to). Freedom, man!
To me, it all amounted to… nothing. Just a bunch of mindless rambling about things few knew much about. Had all the buzz-spreading goofballs actually tried to USE Linux? I suspected not. But that didn’t matter… Only the hype mattered. It’s FREE, man! Open source!!
Yeah, I tried Linux… about four years before the hype monster was born. Was it cool? I guess, in that technical sort of way. Was it useful? Absolutely… if I wanted a file or web server. Which I didn’t. Is Linux better today than when I first tried it? Well, yeah, but I still don’t want a file or web server.
Linux companies failing? Um… yeah. “Duh.” You can’t have fifty companies all trying to be “THE distro” when all of them are trying to sell product that is also provided at no cost. “You’re paying for the manual and the phone support.” Right. And with four bazillion “Learn Linux in 24 seconds” books at my local book store… who needs or wants to take the limited skimpy manual that comes bundled with a $100 shrink wrapped distro?
I hope that by next year Linux is just another OS and not a hype-machine buzzword. I’m sick of omnipotent buzzwords.
In the end, I wonder if OpenBeOS will be the realization of the claims that was the Linux hype… I mean, hey, “it’s free, man!!” But no, not just because of the free-beer and the open source (IF you want to).
Here’s a new concept: it can be used by normal people. The people that don’t think twice about copying and pasting text from one field to another field in a completely different app, which Linux still seems to fail miserably at. But, why should it be otherwise? Linux is a server OS and does that job wonderfully. It was not intended as an on the desktop happy-friendly fun-time play-with-WYSIWYG OS. Like, hello?? Use the tool for what was intended. Modifying one or two X Window managers and desktop environments to look like MS Windows does not make it work like MS Windows.
Oh, never mind… I’m just going to go wander off somewhere and bang some nails into my head with a felt tip pen… Those of you that understand what I’m bitching about don’t need to hear it and those that don’t understand are possibly unreachable anyway. The world will go on and Linux will succeed at what it is good at. …AND there will be a long list of failed “me too” corporations.
“Is it just me or are the authors here at OSnews getting more and more biased against anything not M$, especially linux? sheesh!”
Is it just me or are the Linux community and Slashdot getting more and more biased against anything not Linux, especially Windows ? sheesh!
people mostly push linux because of freedom!
freedom can never be achieved! NEVER!
usability is important, quality is important, and security is important! freedom can come later!
for those who think I’m talking about Microsoft, I’m actually talking about QNX and Win2K
<blockquote>hope that by next year Linux is just another OS and not a hype-machine buzzword. I’m sick of omnipotent buzzwords.</blockquote>Hell. Yes.
When its competitive, I’ll buy another box. My sound card and TV Card works half-ass with Linux. Its a real pain in the ass to tweak out, and inconsistant as hell. I’ll pay ~30-$40 bucks for a box set, only to have to pay more money for a .x “upgrade” a few months later. The .x upgrades will contain improvements that Linux zealots CLAIM now makes Linux “much better” or “as good as” Windows; but BEFORE the new .x upgrade, it was they said the same thing. If I’m going to go thru that shit, why pay the $$$ when ISOs are free???
BeOS works great with all my hardware, its 10x faster than Linux and easier to use; but an updated version may be quite a wait (BeOS NG, OpenBeOS, BlueOS maybe). It is ALREADY better than Windows.
Of course none of the Linux world bothers to even ATTEMPT to make Linux as good as BeOS; they always strain to “beat” Windows because that is much lower goal. Which REALLY pisses me off, because IF BeOS NG and OpenBeOS “fail” I’m gonna need a new OS, and MS slop is NOT an option (I may move to Mac). I had hope for Linux at one time, but the nickle and dime “improvements” on it usually adds a feature or two with one hand, but makes your system run slower with the other hand. BAH!
“How many companies exist that are actually making money out of GPL’d software?
That’s your evidence? Stop it, you’re making me laugh!
”
You make me laugh a lot more. GPL guys are the ones who still need to find evidence there’s a futur in it, not the other way around. Right now the result is pretty catastrophic! It’s like if I say “I start a business to sell bags of air”. Maybe there’s a futur, but damn *I* need to prove it !
Firstly, I’m not much of a GPL guy. The licence has it’s uses. It’s not a cure-all (like closed-source licences). The GPL has many situations when it’s the best licence. Ho-hum.
But yeah, I agree that to be convincing the GPL guys need to provide situations when it’s worked. Often they have. A better way to say that however would be to say that whomever’s saying something should back it with evidence if they want to be believed.
That goes for Eugenia too.
Loki didn’t produce GPL games, they produced commercial software. They failed, ultimately, for the same reason Wildcard Designs failed. People assume it’s because there’s no way to make money with games on Linux (or BeOS), but that’s a red herring. There’s no way to make money selling PC games <em>that have been out for a year when your market can be running Windows for games already</em>. The obvious model for “alternative OS game companies” is Ambrosia Software on the Mac. Linux game company wanna-bes just haven’t figured that out yet.
As for companies selling GPL software successfully, it’s my observation that if you do it with a trick, you have a better chance. Two good examples? Artifex, the company that licenses Ghostscript, and the pre-Red Hat Cygnus Solutions. Ghostscript always has a GPL version, which is a major version number behind the “Aladdin Public License” version. The APL one is free for noncommercial use; Artifex makes its money primarily through OEM hardware licenses. Ghostscript’s author Peter Deutsch claims he’s made enough to retire (and in fact, he did retire recently). And, Cygnus’s commercial “GNUPro” tools and consulting services were likewise profitable. Unlike Red Hat, they remained a private company so we don’t know by how much, but they’d been profitable for years before Red Hat bought them.
All they have to do is sue Microsoft to make a little money, like everyone else is doing. Then maybe they can make Bill bundle the Linux distro with the next version of Windows.
>All they have to do is sue Microsoft to make a little money, like everyone else is doing. Then maybe they can make Bill bundle the Linux distro with the next version of Windows.
Haha, the best thing I read today!
profitable for years before Red Hat bought them
if it was profitable, why would it be bought?
I’ve read thru all the comments here. Doesn’t look like many people actually read the article. MandrakeSoft is not folding — its just in financial trouble and basically trying to adjust its business plans. See this excerpt:
—
<excerpt>
It is estimated that we will “break even” by the end of 2002, but it is unlikely that MandrakeSoft can remain unchanged during these next few months
</except>
Maybe their new plans will work, maybe they will not. Until then, those of you who sound excited to see another linux company go under should please enjoy their windows and save their crocodile tears.
The problem of somebody saying that GPL is bad, BSD style license is good is just crap. When somebody doesn’t like to give away the source, whats the point in the type of license you offer. Unless somebody likes to modify the program and resell it.
About the Linux companies, Linux distributions like SuSE, Redhat, etc costs far too less compared to Windows and SuSE offers 7cds and a dvd for less. The fact of the matter is, that people don’t buy OSes as such, if at all Microsoft decides to stop bundle Windows with Compaq or Dell or HP, the number of people to buy Windows would dramatically reduce. So, Linux companies can survive only if they could bundle their distributions with Dell or Compaq. But first and foremost thing is Linux doesn’t even have a good user interface or a good office suite which is very much important for an ordinary Joe user. KDE or GNOME or whatever simply sucks.
These guys should have to first stop criticising Windows and should think of a good GUI on top of Linux. Something like the Blue OS GUI can be good.
“People assume it’s because there’s no way to make money with games on Linux (or BeOS), but that’s a red herring.”
It goes even beyond that. Making games for Windows is extremmely risky. Even in this broad desktop OS you have *LOT* more chance to crash than to win. Only very few companies can live and make money only on PC games (i.e. Blizzard).
Last year I got to my first E3 ever. And it was shock to see a *tremendous* amount of games that are doomed, just because it’s a tough market to get. I felt bad for all those devoted artists and visionary that will have to close doors.
99% of games companies that have a relatively stable to good situation, is supported by doing lot of console games. The most stable kind of game being Gameboy games. Very cheap to develop, and sell truck loads.
So, being as risky in Windows, what are the chance to be profitable in a secondary (Linux) or tertiary (BeOS) plateform ? Taking account of my experience in the video games industry, I’ll say 0%. Niet. Zero. Aucun.
I hope I’m wrong, but until now nothing proved me the opposite …
Oups sorry … my last post was written with the Loki and Wildcard Design stories in mind. Totally off-topic with Mandrake …
(Désolé Pardon !)
Was the GPL ever invented to make money? I’m not really sure about this but when did the GPL and business have to be in the same sentince? I thought the idea behind the GPL was for developers to be able to put there minds together and share ideas, source code, etc. Am I wrong about this? I think that any business who tries to use GPL’d software to make a profit should be driven out of business, to me that idea sound absolutly crazy. Red Hat has the right idea, they make their money by other means. They use there OS to get there. As far as I can see they will be the only distribution to profit.
>>profitable for years before Red Hat bought them
>>if it was profitable, why would it be bought?
What?!? Are you a complete moron, or just an idiot?
Let me ‘splain.
We live in a CAPITALIST society.
Making MONEY is GOOD.
Companies that make MONEY are GOOD.
GOOD Companies that make MONEY are PURCHASED by bigger companies that have lots of MONEY in the hope that the smaller companies products will make them even more MONEY.
Then the investors of the small company make MONEY from the sale of the company.
MONEY GOOD. BUY COMPANY THAT MAKES MONEY. YIPPEE!! MORE MONEY.
“Red Hat has the right idea, they make their money by other means. They use there OS to get there.”
Well said ! I think you are right on. I think for a Linux distro company, Linux should not be the goal, but only a tool to achieve an other goal. Like Red Hat.
You can’t sell free stuff. Well, beside water, maybe …
There is no way to make money as a distro company, that’s why IBM is not making its own distribution.
Red Hat is not making money — they are only cashflow positive on a pro-forma basis (i.e. not counting interests payments). In reality, Red Hat still loses money.
The Mandrake people probably think they are selling software.
In fact, the only thing of value that they can sell is the manual. If
they can produce a manual that is better than any O’Reilly book, then
they can include their distro on a CD with it.
Give away the software, sell the manual (and maybe a pretty box).
Once you realise what business you are in, you can plan your budget to
suit.
Off topic:
“I really do think communism is great on paper. This is the same story as the dark side of the force. Very charming, quick and easy for a country in distress (economica’ly and socialy), but in the end you lost. You always lost.”
Did you know that Karl Marx’s right hand man F. Engles was an avid Capitalist and was well respected on the Manchester Stock Exchange? He supplied Marx with a stream of funding until his last days (Marx still died in poverty).
On topic:
Is the same thing going to happen to business that try to work with the GPL? Barely surviving and subsisting on handouts from a few people driven by ideology rather then necessity? IS BSD/MIT a better alternative? One thing is for certain, both licenses are changing the way people think about computing. People want to be able to work with the source of the operating system. They want to be able to see it. For programmers it would be nice to have a open playing field where they can develop a product without running into ‘road bumps’ imposed by a certain monopoly. For people serious about security its nice to be able to audit the source code of your system. For users its nice to be able to implement features you would like to see rather then being told what you like (B. Gates seems to believe the opposite). I see a compromise on the horizon.
Off topic:
Kinda like the goofy form of ‘Adams Capitalism’ we use here in the US (which I very much like). One big compromise full of flakes, fruits, and nuts hah hah.
Beos was GPL, *BSd, OS/2, ..
All failed.
Hate GPL..
Hahaha..
BeOS was GPL? OS/2 was GPL?
Off topic:
My contribution to this Communism – GPL battle.
User “Felonious Hiddenbotom” wrote
” What?!? Are you a complete moron, or just an idiot?
Let me ‘splain.
We live in a CAPITALIST society.
Making MONEY is GOOD.
Companies that make MONEY are GOOD.
GOOD Companies that make MONEY are PURCHASED by bigger companies that have lots of MONEY in the hope that the smaller companies products will make them even more MONEY.
Then the investors of the small company make MONEY from the sale of the company.
MONEY GOOD. BUY COMPANY THAT MAKES MONEY. YIPPEE!! MORE MONEY.”
Hmmm, lets slow down here a little, why does everything good have to die?
BeOS was a great os and I still use it, but people don’t really want to talk about because it didn’t make enough money.
Mandrake is a great linux meta-distribution, I love it, I use it every day. I would be really sad to see this company die and everything it stood will be forgotten.
Microsoft is a company that I don’t respect. It’s out of the question for me to use it, hence I don’t. People talk about microsoft every day. I cannot pay ridicolus money for this os that simply can’t do what I require in an os.
As you problably have figured out by now my point is that capitalism DOES kill a lot of great stuff only because the venture capitalist market dosn’t think it generate enough money.
Whomever reads this please remember that all people out there are not capitalists, I myself is a socialist and beleve in man as good, and would like to encourage people to support open source software with money and/or time to contribute to dofferent projects like myself.
Let me quote one of my favorite music groups IRON MAIDEN:
“Only the good die young,
All the evil seems to live forever,
Only the good die young,
All the eil semms to live forever.”
etc, etc.
/Anders
They are selling software. They should be selling software, books and merchandising (caps, stickers, …). Sell absolutely everything you’ve got to sell, don’t give away the software, sell it also, the critical thing would be setting a price entry point, fairly low in Linux nowadays.
I guess by a `pretty box` you mean a pretty package deal. These are the Mandrake’s deals I’d like to see:
– A basic Mandrake, 1 CD. No support.
– A basic Mandrake, 2 CDs. Support added.
– A desktop edition, 4 CDs and printed manual. No support.
– A desktop edition, 4 CDs and printed manual. Support added.
– Just support.
– The Mandrake Club for various upgrades available on a periodical basis.
Stop the freely downloadable edition and bring out a very cheap downloadable one instead ( a basic 1CD Mandrake with no support). Do as Suse does, have demos. The desktop biz is about the technology you give, not the service, service is a plus.
Another one bites the dust
-G
Mandrake is a great distro. Easier to install than win2k. Support it… You can do it for 5$ per month it is cheap and investor will love it!!!!!!!
Go now :
http://www.linux-mandrake.com/en/club/
Thanks!
Damn, you shouldn’t date yourself like that. What are you going to tell us about next? Your Parachute Pants, perhaps?
But seriously, I was being an ass in explaining capitalism to someone who didn’t understand.
BeOS is a great OS, and so is Mandrake (for being Linux). The reality is that so was OS/2 7 years ago, and GEOS 12 years ago. The problem? Microsoft.
They conquered the desktop via any means necessary – killing GEOS and OS/2, and intend to keep it by any means necessary – by drowning BeOS and Linux. Capitalism at it’s best. And it ain’t gonna get better anytime soon.
Be, Inc. will settle out of court, with a gag order – and pay it’s investors a nice return. Great OS, lackluster hardware support (NOT Be’s fault), almost no commercial software (IS Be’s Fault).
GEOS will continue to be developed and will remain an extrememly marginal operating system, with a hardcore userbase dreaming of the glory days.
IBM played on a level playing field with MS and lost due to bad marketing. Pure and simple. OS/2 is pretty much Windows NT, without the Win 32 API – which they could have licensed from MS. Rather than try to properly market OS/2 they licensed off the code, and have thrown their weight behind Linux.
Sun Microsystems will be laughed out of court, because Scott McNumnuts has whined way too much over the past 10 years about MS. The reality is Sun could compete on a level playing field with MS, and tried, but lost pretty much fair and square. They are trying to do in the courtroom what they couldn’t do in the market. Sue to get them to remove Java. Sue to get them to put Java in. Here’s a clue – COMPETE. Your hardware is too f***ing expensive, and Solaris and Java are overrated.
I think that a lot of people do not understand what exactly the GPL is or means.
The GPL has no restrictions against selling your software for whatever price you get from it. It just says that you must also make the source available and you cannot prevent others from making and distributing changed versions of the software.
The real value added of Mandrake and other distros is packaging everything up, testing, and making a pretty install package. They are not required to make ISO images available. Not many people want to find and assemble all of the packages required to make a usable Linux desktop system, that is why they get a distro. Of course, the GPL does prevent the distros from preventing someone like Cheapbytes from reselling their stuff and undercutting their costs.
But another issue is critical mass — you can’t make money off of people who do not use your products, so wide distribution of your product is desirable (ie giving it away for cheap or free) but you have to have a way to make money off of it.
I think that a major problem is not necessarily open vs closed source, but rather the economics of software itself. Here you have a product which the cost to develop is probably exponentially related to the complexity but the marginal cost of production is practically zero. While the proprietary method of exclusion has been the most successful, illegal copying is still rampant.
If people want to make money off of software, they need to figure a way around this issue preferably without turning to governments and anti-freedom legislation such as the DMCA.
YOU STUPID IDIOT!
A company that is making money shouldn’t be bought!
Why would a low risk profitable company be bought by a high risk Linux Startup? Did you ever think about that?
The employees simply wouldn’t agree!
I have witnessed a company being bought. That company was in total shit and was bought only to save its employees.
that is not capitalism you idiot! that is .com-ism!
the GPL has nothing to do with loki games. the games were not even GPLed. Loki’s biggest issue was bad business men and a CEO that was still getting his and a little more. thats what it was about.
as far as mandrake goes…..they suck any how because they have not inovated since 7.0. everything has been about updating the pakages…they acted like their distro was perfect. well it wasn’t. it was poorly integrated, and was nothing but a bunch of Open software thrown in a box. they rely to much on Beta software as thier “Featured” applications.
they should be looking like Lycoris right now. they have a well integrated Desktop, and nice utilities that auto configure your SMB connections. they then integrate it all very snugly into a heavely modified KDE interface.
it just works…thats how Mandrake should look, but it doesn’t.
Xandros is going to be the next big hit also, along with Lycoris because they offer much the same features that Lycoris does, but on a debian system.
RH is a great company, and it will be the General Motors of the big three of the Linux world
I used BeOS it was much better than windows, even with its flaws…but it is gone what next. I have Mandrake Linux it was easy to install (one of the reasons I stayed away from Linux because of the hard install). I am a user, not a programmer or power user. Linux is nice but I am still find it unfriendly…I can not use it as my desktop, I wish I could. Everyone around me that I know is the same way. I hate Windows, but I cannot see Linux as a replacement (maybe it will but that will be years yet). What I would like to see is a OS that is fuss free, powerful and intuitive (duh). Should SUN join in a alliance with evryone else and create a OS. We do not need a new OS, that will not work as long as MS exist. Will a killer app make the deferance? I don’t think a killer app would…we need a new type of OS something different a new angle and complete before it comes into view, a hybrid…don’t know.
I am just tired of the industry, so much talent out there and no one can see beyound the ends of there noses.
Cygnus survived many years before Linux and Red Hat. They did this by selling support for GPL’ed software. I think that Red Hat and others could make a profit if they targeted the commercial/government desktops and sold their product as a service. They install, fix, maintain X hundred desktops for $Y/month. The problem with selling to home users is that they are used to the opposite financial model; instead of getting free software and paying for support they are used to paying for software and getting free support.
“Did you know that Karl Marx’s right hand man F. Engles was an avid Capitalist and was well respected on the Manchester Stock Exchange? He supplied Marx with a stream of funding until his last days (Marx still died in poverty). ”
Hehe … that actually remind me my home land (Quebec, Canada), where tons of people abuse of the socialist regime, and get a relatively good living by sucking the tax money paid by the ones who work their ass. That’s why I moved in US, to work for my family for once …
So a high-profile company trying to sell GPL software is struggling. What does that tell us? NOT MUCH.
Not unless one also looks at the number of non-Open Source software shops struggling with monetary problems. If the statistics I once got quoted still holds true, one might as well conclude that selling closed software is a recipe for disaster, because 3 out of 4 newly founded shops don’t survive the founding years.
And besides, Open Source is neither economic nor business model – it’s a software development model which is has been successfull for 20 years.
“As you problably have figured out by now my point is that capitalism DOES kill a lot of great stuff”
I think the worst ennemy of capitalism is monoply situations. And it’s now the case with Microsoft when they abuse of it (i.e. the OEM hidden contrat). I strongly believe capitalism let the better to win (probably I’m just naive), but right now the capitalism is not healthy, because of Microsoft practice.
They have a great product. Far from perfect (for many reasons), but definitely great (for many other reasons). And that’s pretty hard to start from nothing and getting this level to compete. I loved BeOS, but it was far from being as mature as Windows or Linux. It needed more time to build itself, but was killed prematurally…
guess what, if you are an owner of a private company that is not publicly traded. and a big corperation like Red Hat wants to throw 10 million your way, or what ever it is. and all you have made in the last 10 years was oh…a million or so in personal wealth, are you telling me that you would look at the other 10 peopl ethat you employ and say “I can’t sell, think of the people”
you might, but I am sure you are not the owner of a profitable private business that is being offered 10 million to sell out to a large corperation.
a large company will buy profitable maller ones if the larger one can wrench it away for a good price…but most often, they go after the failing ones because they think that they can make that failing company, with a cool little tech gizmo into a highly profitable one, and they also think that they can get it for about the cost of paying off the crediters.
if the owner wants to sell his little profit bin because he wants somthing new or he wants to retire, then that is what he/she will do.
AFAIK, the war between OS/2 and Windows was a fair one. The OS/2 was superior at this time, but the public choosed Windows, whatever de reason (better marketing? better visibility? I don’t know). Maybe I’m wrong, but at many times in Microsoft history, they had to do real fight to gain they today’s situation.
>>Beos was GPL, *BSd, OS/2, ..
>>All failed.
The BSD’s are not GPL’d…they use the BSD license; thus their names.
Yahoo uses something like 40,000 FreeBSD servers…that’s a huge failure I’d say
OS/2 failed becuase IBM didn’t market it properly, and Mr. Gates raped and pillaged all he could from it when IBM/MS split.
I’m beginning to think the BSD folks have the right idea.
——–
A company that is making money shouldn’t be bought!
Why would a low risk profitable company be bought by a high risk Linux Startup? Did you ever think about that?
——–
Companys that make money are bought all the time. It is just costs less to buy one that is not making money. If said Linux startup has enough liquid cash from a recent IPO, then by all means if they think it will help them in the long haul they should buy up companies that are making money.
Why would the company sell? You give the owner what he would have made in 5-10 years and he decides to take the offer and retire or start another business.
There are lots of reasons to buy and sell. There are lots of ways to get funding for purchases.
Anonymous, may I ask you age? Because you don’t seem to wise in the ways of the capatalist world.
Landar_c
OBOS (OpenBeOS) IIRC uses the BSD license. It will be the successor to BeOS. BeOS itself is proprietary and is not open source.
As you problably have figured out by now my point is that capitalism DOES kill a lot of great stuff only because the venture capitalist market dosn’t think it generate enough money.
The whole point of capitalism (economically; for the current moment I’ll ignore how it’s the only moral system) is that people can choose the products they wish to support. The BeOS and Mandrake were great products for YOU. They were (are) inadequate for almost everyone else.
It’s been said many times and it’s very true: an operating system has no intrinsic value. What matters is what you can do with it. Sure, the great design of the BeOS gave it a lot of potential, but don’t confuse potential with “great product.” Over the years, there have been billions of dollars of investment into the Wintel standard (software, hardware support, etc.); do you really expect people to throw that all away because a different system boots faster and maybe crashes a little less?
A lot of knowledgeable computer users seem to have a really hard time with this concept. When it comes to an operating system, having a better design does not something is the better overall product.
(of course, the thing I find really ironic about your post is that under socialism, Be never could have existed in the first place)
“From my point of view, Open Source business and Communism are exactly the same: on paper the idea is absolutely great and positive. But when it’s time to apply in the real world, both are messy craps.”
Open Source and communism aren’t even remotely the same. Communism is unleashed on people through fear and doesn’t look like a good idea to anyone with a brain unless they are the ones in control.
I don’t recall open source people holding a gun to your head and threatening you with death if you tried to use a different OS.
If I may be so bold, I think your post and taking a crap both looked like good ideas in your head, but once the deed was actually done, they both stunk.
“there will always be some people who will say open source/free software is blah blah blah great!
the only way to convince them otherwise is just wait until all the OSS/FS companies die and only 2-3 remain and then we can say ‘We told you SO!!!'”
Why wait until only 2 – 3 remain to make your judgement. You can do it right now.
Microsoft got where they are today because they came on the scene in the beginning of the home PC market, through some underhanded business practices and a lot of brilliant ones (like making deals with hardware manufacturers instead of trying to sell end users their OS). They became a monolpoly against which nobody has been able to compete.
Apple also was around at the beginning of the whole home PC thing. They earned a very loyal following back then and still enjoy it today I believe. If they had come later, or if their OS ran on PC hardware, they wouldn’t exist today either. I think the only thing that has saved them so far is that they are so different from what MS is doing.
Now, name me one proprietary desktop operating system that began in the 1990s that has been successful. You can’t because there aren’t any.
On the other hand, I can think of many free and open source operating systems and applications that have grown in market share since 1990s or later and still exist today. FreeBSD, OpenBSD, NetBSD, and all the Linux flavors.
To me that speaks very highly of the open source and free software business models. The fact that they can grow in a MS dominated market, where no proprietary business model has been able to, speaks volumes as to the validity and value that these business models offer.
——
Now, name me one proprietary desktop operating system that began in the 1990s that has been successful. You can’t because there aren’t any.
——
OS/2
It has survived. IBM decided to open source it but, it was succesful. From what I understand, the server version of it is still in use by many banking institutions.
Also, as far as I know, NONE of the open source distribution companys have made money on desktop “sales”. The only one that I know of that has turned a profit, Red Hat, made it in the server market.
If you are going to only make money on the support of an OS, the desktop market is NOT the one to be in. To get people to use your desktop OS, it has to be easy to install and use. If it is easy to install and use–why do you need support?? Besides, a home PC can be down for the few days that it takes you to figure out what is wrong. A server, on the other hand, cannot. That is probably the biggest reason why Red Hat has turned a profit and the other distros have yet to turn a profit. Will they ever? Not until they charge for the OS and then they will lose there following and someone else will make a new free distro and the cycle begins again. Eventually, I predict that innovation will begin to degrade as with the quality of the OS. Without the incentive of money, why work hard to get the bugs out? So you have to charge for the software (since charging for support doesn’t work), then somebody else makes another free distro…. and the cycle continues.
That is my prediction.
Landar_c
“If I may be so bold, I think your post and taking a crap both looked like good ideas in your head, but once the deed was actually done, they both stunk.”
Hehe sorry if my poor english doesn’t let me explain exactly what I have in mind. I *DON’T* compare open source with communism ! I compare two thing that I think look good on paper, but doesn’t work in real life.
Said that, I think open source work, but not well in a business point of view. I’m maybe way wrong, but this is the expression of my opinion. Sorry if my first post didn’t translated what I tried to say.
Cygnus sold to Red Hat to make more money. What, you think companies are only bought when they’re failing? It’s better business to buy <strong>successful</strong> companies. At the time, it seemed Red Hat was flying high, and to be fair they’re not doing badly when you factor out the dot.com insanity. After all, they’re still here and don’t seem to be in danger of collapsing, which is more than you can say for many of their dot.com contemporaries that didn’t have anything to do with open source at all.
This entire “communism vs. capitalism” debate is somewhat beside the point, since all the companies in question are definitionally capitalist. Some have a more socialized approach to the marketplace than others, but that’s the way business is. The “free market” has a great deal of socialization in it, both in obvious ways such as government bailouts and subsidies and in more subtle “cost externalizations” (everything from environmental damage to the way property values are affected by business locations). It’s been argued that we’ve never seen “true capitalism” (no market socialization at all), which is perhaps exactly as true as the argument that we’ve never seen “true communism,” and for exactly the same reason: the closer you get to either extreme, the greater the societal costs, until massive regulation or deregulation, as appropriate, becomes inevitable.
The problem with using GPL software as a basis for a business is that markets are essentially driven by scarcity. If you can get the software free anywhere, you’re not selling a scarce product. This is a problem any Linux distribution that doesn’t make itself partially proprietary will have. A license that simply precluded distributing ISOs would help, as would a license that requires payment for commercial use, but both of those seem precluded by the GPL.
Another note: the idea that the BSD license is better for commercial software is a misunderstanding. For companies who want to <em>use open source software in their products</em>, BSD-style licenses mean that they can do it without any compensation to the author and without returning their modifications to the community. For people <em>writing</em> software, there is no monetary protection offered by either license, but the GPL means that at least people can’t use your work without being obligated to share the way you did. Thus, if a business wanted to release open source software, the GPL license is the lesser of two evils, not the BSD. If a business wanted to make money selling software, they shouldn’t be using an open source license at all (although a source license that doesn’t meet the open source definition might work).
“It’s better business to buy successful companies. ”
It ALWAYS depend on the situation. Take Be Inc as example. Palm bough that falling company to get some technologies and a good engineer team addition. Period. All that for few millions, that was a good deal. Scavenging a falling company can be really good because you get it for cheap, which is not the case when the company is successful hence expensive …
I think the BSD license is not a misunderstood, but as a different point of view from you.
As I programer, I will always choose BSD like license over GPL, because I don’t care if, say, Microsoft get my library and incorporate it in Windows closed source and make millions and all. As long as Microsoft credit me as the developer of this library, and that there’s a way to anybody to refere to my own version (just a web link is enough), I see no problems.
Again, this is just a personnal choice matter. But I think there’s lot more chance that business will re-use my stuff than a viral GPL code.
Still off topic:
One can wonder why almost all posts on this board that mentions capitalism, does it in a “it’s not that great, but it’s the only way” matter.
I’m really glad Mandrake is a french company, maybe European Union can put in some money if needed.
I would like to add something to your little footnote:
* Open source software will survive WITHOUT any kind of capitalism. Yes, the community actually well with small resources.
* Microsoft will NOT survive without capitalism. It’s market domination is based on bizarre amounts of money.
Please bear in mind that there are lots of differences between communism and socialism, one shouldn’t mention it if one don’t know the differences.
<blockquote>Actually, it has everything to do with the GPL, because it appears that no one’s having much luck finding a sound and working business plan that works with the GPL for Linux on the desktop. Perhaps someone will in the future, but to date the sound and working business plan has been to abandon the desktop and focus on providing services to enterprise customers.</blockquote>Eugenia abscribed fault, not just a vague relation, in the GPL and Mandrake’s business. It’s a common superficial opinion.<p>So far as web services go at the Microsoft Developer Day conference the spokesman said that Microsoft’s .NET was largely about web services (SOAP/PASSPORT et al) and that the company is staking its future on them. Many profitable businesses provide computer services and often the tools they use are under the GPL licence.<p>When the quality of the tools is of more importance than who has them the GPL works. When the overhead of selling a product is too much the GPL works. When you sell consulting on your product that isn’t well known (like Zope). When you want to get your name out there the GPL works.<p>That anyone would consider the GPL a drop-in replacement for open source software is what is at fault here (not that Mandrake necessarily believe this). That Mandrake are asking for money shows that their business plan has faulted. However, if true, the statement that they plan to be profitable by the end of the year shows that they aren’t solely just giving away software.<p>They provide a good product that I have used. I’ll gladly pay for it in the hope that it will continue.
Remaining off-topic:
One can wonder why almost all posts on this board that mentions capitalism, does it in a “it’s not that great, but it’s the only way” matter.
Actually, I’m saying that it is great, and that it should be the only way, as it’s the only moral system. To delve into exactly why would take more space than I care to use here, but Ayn Rand’s work provides a wonderful foundation.
* Open source software will survive WITHOUT any kind of capitalism. Yes, the community actually well with small resources.
When did I say differently? I said that Be wouldn’t have existed, and that’s quite simply because the government would never have allotted them money, seeing as the company would be “unnecessary,” as they would be competing with other government-funded institutions. Obviously open-source would survive in a non-capitalist state, without, of course, the many fine improvements put into it by commercial companies seeking their own gain. I have never claimed differently.
* Microsoft will NOT survive without capitalism. It’s market domination is based on bizarre amounts of money.
Actually, its market domination is based on having the best overall product (which, of course, includes compatability, acceptance, and a bunch of other things that people looking only at the technical aspects often overlook).
Please bear in mind that there are lots of differences between communism and socialism, one shouldn’t mention it if one don’t know the differences.
I am personally aware of the differences, but it’s definitely good to point out that they are not the same thing, so thanks for doing so.
“When did I say differently? I said that Be wouldn’t have existed, and that’s quite simply because the government would never have allotted them money, seeing as the company would be “unnecessary,” ”
In fact I strongly disagree. I’m from the province of Quebec, and it’s probably one of the most socialist state in north america (at some point that just pronuncing ‘capitalist’ word in public make peoples look at you like a dangerous terrorist).
The governement here for the last decade used LOT of public funds to finance this kind of business, especially with the “multimedia city” program, that encourage creation of enterprise based on new technologies.
The thing is, Be would have been existed, and facing the same problems as the original Be, with little lobbying the gouvernement would have saved year after year the company be giving public fund money, at least just to help the Quebec image from outside. That’s the way socialism work.
The good part is: Be would still be alive.
The bad part is: it would be alive by totally artificial means, directly from the Quebec tax payers pockets. I hate that system, because it goes against any principle of healthy competition.
Just a little side story about Quebec socialist screwed up system. One of the first company to realize the fiscal “paradise” in Quebec (for a business point of view) is UBI Soft, the giant video game publisher. They created in Montreal their biggest developement studio in the world (I guess something like 500-600 programers/artists).
A young Quebec’ programer salary: 30K $CAN
The governement, because it’s a “multimedia” company, pay 50% of the salary for each employee for **10 YEARS** !!! which mean it cost only 15K$CAN per programmers.
Then convert this amount in US dollars, and you get a huge cost of 10K$US per year per employee.
Can you imagine how laughing is the bosses at UBI Soft ? And all that financing comes from where ? All tax payers that give 50% of their salary every year.
Stupid, stupid, stupid system. No wonder I moved in US.
Well, Eugenia wrote:
none of the “desktop” Linux-oriented companies makes real money or even survived the… GPL (you can argue as much as you want about that – be my guest).
If Beos, BSd, OS/2 are not GPL, how could they fail?
somethings confusing here.. 😉
And if its because gpl, well, this companies could switch to BSD
easy. Same or better quality, some say. They don’t. *shrug*.
I think M$ shows clear most peoples prefer communism.
one company thinking for them, and helps them avoiding
choice.
where’s the difference between “the only one party”
and “the only one company”?
capitalism, as competition by quality, fails badly with software.
“And if its because gpl, well, this companies could switch to BSD easy. ”
I think it’s all but easy ! Changing the license for a whole OS like Linux, where thousands of little parts have been done by thousands of people, I think it become very, very hard, say impossible.
I don’t think the problem is the GPL, I think the problem is too many companies competing to sell the same GPL product. If there were only two or three companies selling Linux packages, there would be market share for all of them. Even if Mandrake folds, it’s just a natural thinning-out. There used to be many different automobile makers in the US; now there are three.
Personally I think Mandrake has done a good job with their business plan. Their product is available in real stores, like Comp USA and Best Buy where “normal” people see it and are exposed to their brand name. The availability of disk images doesn’t affect their sales to average users – to use an iso you have to have a CD burner and high-speed access, along with at-least-average computer knowledge. I’d bet people who see it in the stores and choose a distro by holding the RedHat box next to the Mandrake box aren’t even aware it can be downloaded.
” I think the problem is too many companies competing to sell the same GPL product.”
I totally agree. I think if all efforts from everybody could be put on one single distro, maybe the chances to eat more Windows share on the desktop may grow a lot faster.
”
profitable for years before Red Hat bought them
if it was profitable, why would it be bought?
”
Uhh, not much of a capitalist are you? If you own something that makes money, it will make money for you. Get it? People don’t generally buy companies that have no intrinsic value, either in IP, talent, or profitability. So.. Did I answer your question?
Now, maybe you were asking a different question, very sloppily. If you meant, “Why would it be sold?” You move into a slightly more complex realm. A company might be sold for a number of reasons. One good reason to sell a company that is profitable is that a businesses selling price generally is a function of it’s assets minus debts plus several times it’s expected annual profit. In other words a lump sum that the owners of the company get all at once instead of over the next few years. This would allow an owner to collect a boatload of cash and devote their time to other endeavors. Also, when a company buys another company, it can be wholly or partially in exchange for interest in the buying company. So, it’s possible that Red Hat saw something of value in Cygnus’s assets, talent and/or profitabilty that would be of strategic advantage to Red Hat. The owners of Cygnus may have been given the opportunity to get a boatload of cash and possibly the opportunity to stay on working with RedHat, possibly with some controlling interest in Red Hat, thus taking part in something that was bigger than what they were doing as Cygnus.
How all of this actually went down could be an entirely different story. But do you see why one might sell a profitable company and why another might by it?
”
YOU STUPID IDIOT!
A company that is making money shouldn’t be bought!
Why would a low risk profitable company be bought by a high risk Linux Startup? Did you ever think about that?
The employees simply wouldn’t agree!
I have witnessed a company being bought. That company was in total shit and was bought only to save its employees.
that is not capitalism you idiot! that is .com-ism!
”
Grrr. Again I see. So, you think that your ONE experience of seeing a company being bought translates to all situations in which companies are bought? Somebody bring me my 2×4. Ahhhhh!!!
I’m sorry. If I was running a high risk Linux startup, I’d take my fat wad of VC cash and buy as many low-risk profitable companies I could that were strategically valuable to my future plans. In addition, when buying these companies, I would likely NOT mix them all together to form one big company. In fact, I would likely leave them to do what they were already doing (and being profitable at, remember) while I organized the main parent company to use the services provided by the child companies to their best advantage.
What you witnessed was a purchase of resources, be they assets or people, at a discount rate. And that can be capitalism if you know how to put those resources to best use for your company. Of course, not every capitalist is a successful or intelligent capitalist, and not all plans that look good on paper work well in the real world. Your mention of employees not mixing well illustrates that.