From service to product - An Open Source Business Model Transformation
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The document discusses transforming an open source software business from a service model to a product model. It describes three common open source business models: the dual license model, distribution and service model, and distribution and monetization (freemium) model. It provides examples of companies like Red Hat, Canonical, Mozilla Firefox, and Google Android that demonstrate these models.
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5/9/2013
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From service to product - An Open Source Business Model Transformation
- 1. + From Service to Product An Open Source Software Business Model Transformation 5/9/2013 企業經營模式與財務策略 Final Assignment 指導教授：江炯聰、林筠、程淑芬 助教：陳育萍 P01746035王議德 P01747019林玲如 P01748015黃峻崢 P01748038馮妙芬
- 2. + Who is Jouston? Active Open Source Evangelist since 1998(15yrs) Doing Linux business from 2000 (13yrs) OS Architect(Software) background, learning to be a Well- Rounded Open Source businessman. Professional Career Highlights: Head of Technical Marketing, Shuttle FAE team builder, Canonical Chairman, COSCUP 2010 COO, OpenMoko Country Manager, HancomLinux For more Info visit http://www.linkedin.com/in/jouston 5/9/2013 2
- 3. + What is Open Source Software? 5/9/2013 3
- 4. + OSS Checklist Source Code Free Distribution Derived Works Non-Discriminatory Non-Restrictive Free as in Speech, no t as in beer 5/9/2013 4
- 5. + Culture and Believes Release early and often, delegate everything you can, be open to the point of promiscuity. – Eric Raymond Given enough eyeballs, all bugs are shallow. – Linus Torvalds 5/9/2013 5
- 6. + Important Open Source Software http://www.slideshare.net/ellyssa/open-source-software-and-libraries-presentation 5/9/2013 6
- 7. + Can’t Live Without Open Source 5/9/2013 7 utes are e use: product to h the source ity is less enomenon) asy cheaper than d adherence to ment’s values 0 500 1000 1500 2000 2500 3000 3500 Middle income organizations (<$50 M) High income organizations (between $50 M and $1 Md) Very high income organizations ( > $1 Md) Money saved since open source solutions are in use* [$ ‘000] (2005) http://www.slideshare.net/kshitiz_goel/open-source-revenue-model
- 8. + Open Source Business Models Dual License Model Distribution and Service Model Distribution and Monetize Model (Freemium Model) 5/9/2013 8
- 9. + What Roles Community Play? Customer / User Key Partner / Vendor Opinion Leader / WOM Marketing Pool External Engineer Community is almost Everything you need but directly monetize from it. 5/9/2013 9 Double Edge Blade Or Say:
- 10. + Dual License Model I have a product with two licenses: one for free and one for money. 5/9/2013 10
- 11. + Dual License Model One product, Two licenses One for free distribution and free use Another for proprietary use Copyright and Control of the product development is on the original developer’s hand. KSF: Market Leader Why Buy: Customer like it’s open source version and need it for commercial use. 5/9/2013 11
- 12. + Case: Trolltech’s Qt (Pronounce: Cute) 5/9/2013 12 KP - Qt Community - KDE Community - SUSE Linux KA - Produce high quality Qt Libraries - Porting to varies OS platforms VP - Best in Class GUI Library. - Very easy to program - Cross- Platform (Write once, run everywhere) CR High-touched 24x7 community maintenance CS Any GUI Application programmer KR - Key Engineers - Community CH Internet C$ - High engineering cost - High community maintain cost - Sample devices R$ Sell proprietary version of Qt
- 13. + Distribution and Service Model Because your support, I have power to ask money for my service. 5/9/2013 13
- 14. + Distribution and Service Model Support and Customization and other Professional Services: Consulting Training Brand Licensing Post-Sales Support KSF: Large base of users who Wants to use the product, Release Cycle for different market. Why buy: Enough amount of user, Waive MS tax(or Piracy) 5/9/2013 14
- 15. + Case: Red Hat Linux 5/9/2013 15 KP - Red Hat Community - CentOS Community - Linux Kernel Community - World Class software vendors: SAP, EMC, IBM…etc. KA - Leading the OS technology development - 24x7 support VP - Earliest and Most Solid Linux distribution - World-class enterprise level support - Slower but On- Schedule release cycle CR - 24x7 IT support - Low- touched CentOS community CS Fortune 500 Eg. Banking, Industrial…etc . KR - Key Engineers - Community - Reputation CH - Internet - CD - Site License C$ - High engineering cost - High customer service cost - Low community maintain cost R$ - Training/RHCE Certification - 24x7 Customer support
- 16. + Case: Canonical / Ubuntu 5/9/2013 16 KP - Ubuntu community - Dell / HP / Toshiba / Lenovo / Asus / Acer - France, China Government KA - Leading Desktop Linux development - Hardware Enablement VP - Most widely used Desktop / Server Linux distribution - Ubuntu- Ready PC - 6 month / 24 month(LTS) release cycle CR - Hardware Enablement - LaunchPad support CS - Dell, HP, Toshiba, Lenovo, Asus, Acer and other PC vendors - France / China government - Google - Amazon KR - Key Engineers - Community - User mindshare CH - Internet - Free CD - OEM team in Taiwan and US C$ - High engineering cost - High customer service cost - Very low community maintain cost (All engineers are community member) R$ - Training/UCP Certification - OEM Support - LaunchPad (bug/software maintain) - LandScape (Mass Management)
- 17. + Case: Cavium Network MontaVista 5/9/2013 17 KP - Linux kernel community - AP vendors, Intel, ARM, Marvell, Freescale…e tc. KA - Leading Embedded Linux development - Customer Support VP - Most widely used Embedded Realtime Linux distribution - Strong customer support - Best SDK - Release cycle follows major Kernel Jump CR - Professional Customer support CS - ARM - Intel - Medical / Healthcare - Automotive KR - Key Engineers - Customer support team - User Mindshare CH - Internet - OEM team worldwide C$ High engineering cost High customer service cost R$ - OEM Support and Site License
- 18. + Distribution and Monetize Model Make you happy so I can earn money from somewhere else. 5/9/2013 18
- 19. + Distribution and Monetize Model Freemium model derivation, Free for use, Monetize from somewhere else. KSF: Large base of users who Using the product. Why buy: Enough amount of user 5/9/2013 19
- 20. + Case: Google Android 5/9/2013 20 KP - OHA(Open Handset Alliance) - Samsung / HTC / LG KA - Leading mobile Linux development - App Store - Mobile Advertisement VP - Most widely used Mobile Linux distribution - OHA - Open Source - Compete with Apple iOS - Controlled Fragmentation CR - Android Community - Mobile AD dashboard CS - End User - Mobile Advertise Buyer KR - Key Engineers - Community - OHA - Patent CH - Internet - Telecom operator - Handset vendor C$ High engineering cost High supporting cost Moderate marketing cost R$ - Mobile AD - App Download
- 21. + Case: Mozilla Firefox 5/9/2013 21 KP - Google - Community KA - Community engagement VP - Most widely used browser - Most “Plugable” Browser, thousands of plug-ins CR - Coopetion with Google - High-Touched community maintenance CS - Google - Community KR - Key Engineers - Community CH - Internet C$ High engineering cost Middle community maintain cost(All engineers are community members) R$ - Mobile AD through Google (Default search/Landing Page)
- 22. + Open Source Business Models Dual License Model Distribution and Service Model Distribution and Monetize Model (Freemium Model)From Service to Product 5/9/2013 22
- 23. + Footnote http://www.slideshare.net/kshitiz_ goel/open-source-revenue-model http://www.slideshare.net/faberNo vel/businessmodels-opensource- en-125492 http://www.slideshare.net/vimal02 12/open-source-library- management-systems http://www.redhat.com/ http://www.mvista.com/ http://www.mozilla.org/en-US/ http://www.android.com/ http://www.openhandsetalliance .com/index.html http://www.ubuntu.com/ http://www.canonical.com/ http://en.wikipedia.org/wiki/Qt_ Development_Frameworks http://www.linkedin.com/in/joust on 5/9/2013
Editor's Notes
- #3: [email protected]
- #6: Promis’cuity
- #10: They BIAS your decision
- #16: NYSE:RHTRevenue $1.13 billion (2012)Operating income $199 million (2012)Net income $146 million (2012)Total assets $2.49 billion (2012)Total equity $1.39 billion (2012)Employees 4,500 (2012)
- #17: Private Hold LimitedRevenue $30 million (2009)Employees 800+
- #18: subsidiary of Cavium NetworkEmployees Over 250 (June 20, 2008)
- #21: NASDAQ:GOOGRevenue US$ 50.18 billion (2012)Operating income US$ 12.76 billion (2012)Profit US$ 10.74 billion (2012)Total assets US$ 93.80 billion (2012)Total equity US$ 71.72 billion (2012)Employees 53,891 (Q1 2013)
- #22: Mozilla FoundationRevenue $163 million (2011)