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Why EU Companies Choose Open Source. No. Not Lower Cost.

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  • User profile image
    sbc

    Why EU Companies Choose Open Source. No. Not Lower Cost.

    groklaw article wrote:
    This study by IDC is fascinating. Of course, I would like it, because it confirms something I've been saying for a couple of years now, and it always feels good to be right, rare though it may be in life. What drives European companies to use Open Source isn't lower cost, the study found. It's quality and the ability to change the software at will. I knew the latter was important, which is why I was so opposed to indemnification offerings that forbid changing the software without permission.


    Freedom and flexibility are why some choose open source, not price. They can change the software, get someone else to support it and do pretty much what they like (except modify it then pass it off as their own). It prevents the need to build an application from scratch.

    As more useful products and libraries are open sourced, more will use them. If someone finds some code that pretty much does what they want it to, they have to contribute back (unless it is under a BSD-Like license). If you want to make money on software, GPL is not an option. Going GPL may cause your product to be released earlier though. People make money by providing support and services. i.e. free (or cheap) product, pay for support; rather than pay for product, free support

    IBM gets this, Redhat, Novell and Sun also do, but will Microsoft? Will we get cheap Windows/Office in the future?

  • User profile image
    MagusOSY

    I assume you can provide evidence that the support subscription model has magically started making money?

  • User profile image
    harumscarum

    damn $5000 for a study.

    So you believe support and services would be cheaper then buying a product? I guess it depends on the product but I find it unlikely that the price difference would be that great (especially if we are talking about IBM). You are also assuming that the services would be done by competent persons (insert funny consultant story here).

    I think the price for any piece of MS software will depend on the market and what people are willing to pay.

  • User profile image
    msemack

    If I make money off of tech support, where's the incentive for my product to be easy to use?  Where's the incentive to provide a "knowledge base" on my web site, or an FAQ?

  • User profile image
    MagusOSY

    So then. Make it good and easy to use.

    Less difficulty -> more usage, but less need for tech support -> less revenue.

    Make it artificially hard.
     
    Greater difficulty -> user dissatisfaction and less usage -> less need for tech support -> less revenue.

    So, care to try again to explain how the subscription support model is a good thing?

  • User profile image
    msemack

    Making money from support contracts means that it is in my best interest to produce software that is scary to install, hard to configure, and non-intuitive. 

    For that matter, it is better for me to limit the product's feature set, and then charge for "consulting" services, like making a custom version of the software, adding these "missing" features.

    This is how the enterprise MRP, CRM, and ERP markets stay afloat.  The cost of the system (while still huge), is only a small part of the revenue.  The real money comes from support and consulting contracts.

    If everyone transitions to a support-contract model, it seems like that puts pressure on the industry as a whole to make computers harder to use.

  • User profile image
    msemack

    I'm not going to deny that having access to the source code can be a good thing for the customer.

    However, it doesn't seem like making money from support contracts makes the world a better place.

    #1 It's less profitable, which means I can't hire as many employees.  Or I have to pay my programmers less.

    #2 It seems to encourage the cryptic, non-intuitive software that we tried to leave behind in the mainframe era. 

    If anything, I think that the EU likes open source because they can hire local programmers to work on it, instead of sending money overseas to Microsoft.

  • User profile image
    W3bbo

    The thing is right... the current A-Level syllabus says that there's only 4 types of software:

    "Bespoke"
    "Retail / Off-the the shelf"
    "In-house"
    "Modified"

    No mention of FOSS whatsoever.... We've been using the same main syllabus since the mid 90's... heck, there isn't even mention of USB, we're still versed in "Serial COM ports", that "wireless networking is currently very expensive and very slow, using propriety protocol", and even worser still.... "In the coming years, 10Base Ethernet may become the new standard in networking"

    AIEEE!

  • User profile image
    msemack

    Way to miss the point.

  • User profile image
    MisterDonut

    Ok, ok, showing my American roots here.. But..

    Do you think it has anything to do with Linux being perceived as European (since Linus is European)? Not that other arguments aren't valid, but I wonder if nationalism (in terms of EU) isn't a factor.

  • User profile image
    rjdohnert

    Most of what IDC says is true.  Thats why I use a lot of Open Source in my organization.  Its not because Im a cheap a$$hole and just want something or free its because I can tailor it to my needs and I have no problems doing so.  Im not dictated to follow anyones upgrade path.  I have no problems paying for good software in fact Im thinking o moving the Mail server over to Exchange when I get the chance because I like the Outlook web access and its more secure than having a sales person have POP3 set up on their laptop or even the one tablet we have now.  If the laptop gets stolen or lost, I just change the password and I dont need to worry about anyone viewing any conidential e-mails.  On the other hand I like OpenOffice for the Export to PDF capabilities and that its formats are pure XML.  There are several things to like about different products and my opinion and suggestion is to use what works for you.  I would not consider Linux for widespread deployments because in my opinion I dont want to be that level of inhouse support.  Linux support is an Oxymoron, the only Linux distribution that had excellent support was SuSE and now that SuSE has merged with Novell the support really sucks now, Red Hat? Shoot Im still waiting for a response from Red Hat on a question I had back in December.  The ironic part was that a Microsoft tech actually helped me fix the problem.

  • User profile image
    msemack

    MisterDonut wrote:
    Do you think it has anything to do with Linux being perceived as European (since Linus is European)? Not that other arguments aren't valid, but I wonder if nationalism (in terms of EU) isn't a factor.


    I think there is definitely some argument for that:

    If they buy Microsoft, they send the money overseas.

    If they buy Suse, it stays in the EU.

    If they buy Microsoft, they pay Microsoft for their support contracts.

    If they go Linux, they can hire local programmer to do any customization work.

    I remeber this being cited by several EU people after various Linux wins.  When you go OSS, there is a PERCEPTION that you are keeping the money in the country.

    Note that I said "perception". Smiley

  • User profile image
    sbc

    For some countries (not EU or Western), open source is the only option. Simply because it is too expensive not too - if it was more affordable, Microsoft would make far less profit, break even, or lose money.

    One Windows license can be several months salary (or very close to). I cannot see how Microsoft can get a big share in these countries (they may get some customers with the richest).

  • User profile image
    Rossj

    sbc wrote:
    One Windows license can be several months salary (or very close to). I cannot see how Microsoft can get a big share in these countries (they may get some customers with the richest).


    I think footballism is a good example of this, I forget what it was he wanted to buy but it was some ridiculous percentage of his monthly wage, and people wonder why piracy is rife in some countries with pricing like this. And before anyone asks, XP Starter Edition whilst cheap is obviously not of use to someone of Footballism's technical level.

  • User profile image
    Steve411

    What's going on with this world? Tongue Out

  • User profile image
    Tensor

    Funny story. Well, relatively appropriate story anyway. I was chatting to some Uruguayian guy one time on the internet and we got on to relative wages somehow. At the time I was on roughly the national average wage for the UK. he told me the average national average wage for Uruguay and then said "but you guys must earn 10 times that". I didnt have the heart to tell him it was actually 100 times. Makes you think!

    PS - Uruguay - the only country in the world with the same vowel 3 times in the first 5 letters of its name!

  • User profile image
    leighsword

    Rossj wrote:
    sbc wrote:One Windows license can be several months salary (or very close to). I cannot see how Microsoft can get a big share in these countries (they may get some customers with the richest).


    I think footballism is a good example of this, I forget what it was he wanted to buy but it was some ridiculous percentage of his monthly wage, and people wonder why piracy is rife in some countries with pricing like this. And before anyone asks, XP Starter Edition whilst cheap is obviously not of use to someone of Footballism's technical level.

    he want to buy the webmatrix.
    i don't think the price is a problem, the computer hardware is costly too,the primary factor should be 'software is easy to copy'.

  • User profile image
    Rossj

    ^
    |
    Please edit this post, it was leighsTroll in your second quote, not me.

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