Commercial Open Source Business Panel

On the fourth day of this incredibly packed conference, I’m sitting in a panel discussion about Commercial Open Source Business models. The panelists are Tim O’Reilly, a venture capitalist who funds open source projects, Brian Behlendorf (my old boss and employer), someone from Novell and some guy from a company Tim described as from the “Evil Empire” and who one of the other panelists corrected as “a small software company in the Northwest.”

Key points:

    Venture capitalists are looking for software companies that want 40-50% profit models after a couple of years. They’re not going to find this.

  • Open source naturally keeps software prices in check.
  • What made Dell successful was getting to a point where their processes were fine-tuned. In software, anybody can replicate these kinds of processes.
  • CollabNet’s model is service-based. We take care of all the little things that made managing software a high-cost issue. It’s an ASP model.
  • From VC guy: a lot of customers is better than a lot of intellectual property and copyright.
  • Reputation capital: Micahel Jordan made more money selling Nike products than he ever made playing basketball. The open source superstar programmer has reputation capital. The employer does not retain this if the programmer leaves.

Posted by Cameron Barrett at July 29, 2004 01:53 PM

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