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What's The Linux Kernel Worth?
schneelocke writes "What's the value of the Linux kernel? After an offer by one Jeff V. Merkey to pay 50K USD for a BSD-licensed copy of Linux, David Wheeler does some calculations and comes up with an estimate of 612M USD." Wheeler has come up with a number of interesting software-worth estimates and other quantified facts about Free software; since some aspects involve ineffables and hypotheticals, the details can be argued, but he provides a good framework with SLOCCount.
By my calculations, the Linux kernel is worth: nothing.
Before you get your tights in a twist, just listen to me for a moment. The value of a product in a capitalistic system is determined by what the market is willing to bear. Yet it is not worth anything if the developers are not willing to sell it at what the market demands. Thus we have a gap. The market would probably be willing to bear a few million (perhaps as high as 50 million) dollars for the Linux IP. Yet it seems that the developers would demand a price in the range of 612 million.
The end result is that the Linux kernel has no market value what so ever. The developers won't sell it at the market's price, and the market won't buy it at the developers price.
Javascript + Nintendo DSi = DSiCade
After an offer by one Jeff V. Merkey to pay 50K USD for a BSD-licensed copy of Linux
Why would they do that? What advantage is there to the BSD vs GPL licenses?
The only advantage is that if you redistribute or sell software that is GPLed, you have to provide source code - with BSD you don't.
So, Merkey's company wants to sell modified Linux without providing source code to the modifications. While I doubt the modifications are worth that much, he apparently does.
Why wouldn't Merkey use FreeBSD for the application he wants to sell? Almost all linux software is available for FreeBSD, and then he wouldn't have to pay $50,000 for a license.
Or can someone explain this to me?
You are assuming that market value is the only measure of worth. Even in capitalist accounting (GAAP) you are mistaken.
To an accountant, all assets are valued at their expense, minus any prior amortization or markdowns. Most Linux users would thus have to include in their valuation any time they spent downloading, configuring, and installing the kernel.
I would have to include a few hundred dollars for the time to develop, test, and submit the (very small) patch I submitted. With ten years of their life put into it, Linus Torvalds, Alan Cox, etc would each have to value it at several million dollars.
According to an IBM rep who spoke to our LUG 2 years ago, IBM promised to invest 1 Billion in Linux because they had estimated it would take them $10 Billion to get it to where it was then. That was in the 2.4 stage. Now, with the 2.6 kernel, it should be worth another Billion or so. Of course, I'm willing to sell copies of the latest kernel to all comers for only $500. That includes a year of my "Platinum Support".
HexaByte - he's a square and a half!
For some very very very very very loose definition of "Linux", FreeBSD *is* Linux! No, really. I saw an ad once for a vendor that was selling Linux distributions, and there was FreeBSD on the list of Linux distributions....
:)
Heck, who am I to tell 'em different? I used to refer to Abiword as "my version of Word", as in, "My version of Word seems to have problems with your file, could you try resending as RTF?" Nobody ever questioned me (which just shows how overrated the notion of Word as a "standard" is).