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Displaying posts with tag: business model (reset)
The Future of NoSQL (Companies)…

A friend recently bought a GM car. I proceeded to inform him that I am shorting GM stock (technically a put option). He was shocked. “But they make great cars,” he exclaimed. I responded, “I’m not shorting the cars, I’m shorting the company.” Why am I recounting this exchange? Because I believe that the new wave of NoSQL companies—as opposed to the rebranded ODBMS—presents the same situation. I am long the products, but short the companies.

As the GPL fades

We’re continuing to see signs that the dominant GPL open source license may be fading from favor among commercial open source software players. The latest move away from the GPL comes from content management software vendor Alfresco, which is moving to the LGPL after originally releasing its code under the GPL three years ago. The reasoning for the shift, according to Alfresco CEO John Newton, is the company sees greater opportunity beyond being a software application, particularly given the emergence of the Content Management Interoperability Services standard. Alfresco won mostly praise for its move, and it does make sense given where open source is going these days.

I believe the emerging trend away …

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Open Source Licensing Considerations

The two predominant forms of open source licenses are BSD and GPL. PostgreSQL is licensed under the BSD license , while MySQL is licensed under GPL . While the details are arcane, the business impact is significant, and that is what this post addresses.

The BSD (or BSD-style) License: This license basically says: ‘This code is provided as is, do what you want with it, and include this copyright in your resulting product.’

The GPL License: This license, also known as the copyleft license, essentially says: ‘This is free and distributed as source code, and any addition or extension must also be distributed under these exact terms.’

BSD essentially says I prefer open source code, so I’m making my source code open and freely available, but what …

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Comparing Cloud Databases: SimpleDB, RDS and ScaleDB

Amazon’s SimpleDB isn’t a relational database, but it does provide elastic scalability and high-availability. Amazon’s recently announced Relational Database Services (RDS) is a relational database, but it doesn’t provide elastic scalability or high-availability. If you are deploying enterprise applications on the cloud (including Amazon Web Services), you might want to look at ScaleDB because it is a relational database and it does provide elastic scalability and high-availability.

Amazon describes SimpleDB by comparing it to a clustered database:

"A traditional, clustered relational database requires a sizable upfront capital outlay, is complex to design, and often requires extensive and repetitive database administration. Amazon SimpleDB is dramatically simpler, requiring no schema, automatically indexing your data and providing a simple API for storage and access. This approach eliminates the administrative burden of …

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Comparing Cloud Databases: SimpleDB, RDS and ScaleDB

Amazon’s SimpleDB isn’t a relational database, but it does provide elastic scalability and high-availability. Amazon’s recently announced Relational Database Services (RDS) is a relational database, but it doesn’t provide elastic scalability or high-availability. If you are deploying enterprise applications on the cloud (including Amazon Web Services), you might want to look at ScaleDB because it is a relational database and it does provide elastic scalability and high-availability.

Amazon describes SimpleDB by comparing it to a clustered database:

"A traditional, clustered relational database requires a sizable upfront capital outlay, is complex to design, and often requires extensive and repetitive database administration. Amazon SimpleDB is dramatically simpler, requiring no schema, automatically indexing your data and providing a simple API for storage and access. This approach eliminates the administrative burden of …

[Read more]
Open Source: Its Impact on Complementary Goods & Services

A core economic principle is the Complementary Good . In short, when two or more things are used together, they are complementary. When the price of an item goes up, the usage of all of its complementary goods goes down. Similarly, if the price of an item goes down, the usage of all its complementary goods goes up. An example is the computer printer. Printers and ink are complementary goods. Proprietary ink products are extremely valuable—at one point ink delivered 60% of HP’s profits —so HP, understanding the principle of complementary goods, practically gives away printers because they make money on the ink. This is the classic razors and blades business model.

Businesses want to lower the cost of their products, while maintaining or improving their margins. …

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Open Source: Its Impact on Complementary Goods & Services

A core economic principle is the Complementary Good . In short, when two or more things are used together, they are complementary. When the price of an item goes up, the usage of all of its complementary goods goes down. Similarly, if the price of an item goes down, the usage of all its complementary goods goes up. An example is the computer printer. Printers and ink are complementary goods. Proprietary ink products are extremely valuable—at one point ink delivered 60% of HP’s profits —so HP, understanding the principle of complementary goods, practically gives away printers because they make money on the ink. This is the classic razors and blades business model.

Businesses want to lower the cost of their products, while maintaining or improving their margins. …

[Read more]
Why Profitability is Critical for Open Source Software

Where are you going to invest your time and money. You may invest in your kids, your work, your hobbies, and more. As you make these decisions, your passion is one consideration, but another is the return on your investment. Of course, you want your investments to be successful. The best way to ensure success is to bet on winners. In other words, you want to invest your time and money on things you are confident will be successful. This holds true in your personal and your professional life.

When Alexandre Dumas (on a side note, my wife refers to me regularly as a Dumas) said that "Nothing succeeds like success" he was encapsulating this same decision process and the conclusion that people want to bet on winners, and that by so doing, they are perpetuating that winning.

So what does this have to do with open source software (OSS)? I received a note from Roland Bouman about a prior post, where he said: "I got seriously involved in …

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Why Profitability is Critical for Open Source Software

Where are you going to invest your time and money. You may invest in your kids, your work, your hobbies, and more. As you make these decisions, your passion is one consideration, but another is the return on your investment. Of course, you want your investments to be successful. The best way to ensure success is to bet on winners. In other words, you want to invest your time and money on things you are confident will be successful. This holds true in your personal and your professional life.

When Alexandre Dumas (on a side note, my wife refers to me regularly as a Dumas) said that "Nothing succeeds like success" he was encapsulating this same decision process and the conclusion that people want to bet on winners, and that by so doing, they are perpetuating that winning.

So what does this have to do with open source software (OSS)? I received a note from Roland Bouman about a prior post, where he said: "I got seriously involved in …

[Read more]
Show Me the Money!…Monetizing Open Source

OK, you’ve released your open source product and built a huge userbase. Now your shareholders/investors are pressing you to monetize that userbase. How do you do it? There are many ways to monetize open source. For simplicity, let’s segment the revenue sources according to who is paying:

Users :
Your users probably downloaded your product for free. Some are willing to pay for certified/approved distributions, maintenance, updates, support and more. Because open source turns your product and services into commodities, you will need to leverage your brand, and the expertise that it embodies, to maintain premium pricing.

Another good revenue source is certified education. If you’ve built a large userbase, businesses clearly see value in your product. As a result, employees and job-seekers will enhance their personal value and marketability if they are certified experts with your product. Assemble copyrighted educational …

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