Slashdot Mirror
On The Linux Culture and Money
Andrew G. Feinberg writes "The latest Andrew Leonard piece on Salon.com deals with whether our favorite corporations will still be true to the community while having to keep shareholders happy. Excerpt is below:
"Will the huge financial worth of the founders of companies like Red Hat and VA Linux end up disillusioning
small-time developers? These companies must now keep their shareholders happy -- will the goal of keeping
stock prices high interfere with code design decisions that used to be based on purely pragmatic factors? And
what happens if Red Hat and VA Linux stock goes down in flames?"
"
The linux community has to take a deep look into what type of reception these companies need to receive.
linux developers aren't in it for the money, they are in it because taking part in something so worthy, is a great use of effort.
we are all paid back by linux developers in that we can get the software free of charge if we choose. That itself is a great reward for everyone.
If you ask Richard, he will tell you that this is immoral. It would be better to flip hamburgers or work in a soup kitchen for the homeless than to give up your principles by creating closed source under contract. The more money you make doing this, the worse it is, because the greater your betrayal.
You mean "habanero", as in chiles habaneros. And no, there is no tilde.
I've never understood why there's no tilde on the chile. The famous aria from the opera Carmen is called "the Habañera", but it's talking about a woman from Havana. For some reason, the chile--even in Spanish--is denuded of the tilde. How strange.
Compare the number of shares of Compaq stock with the number of shares of VA stock. I suspect that you will find that *many* more shares of Compaq are floating around, making for a far higher total net value.
and dissent is supposed to be a BAD thing ? Conflict is always good for everyone -- it encourages people to think for themselves...unlike the closed minded elitest braindead BSD community which discourages forking and dissent.
But what if Open Source (as in freely distributable source) is not a model wich can sustain the same kind of profits as the present software biz? Personally I dont need service for most of my software, and usually I dont even pay for it if its closed source :)
:) Thats why I dont see non-free open-source licenses as a good thing, IMO some software just wont be made without the earnings guarantueed by licenses prohibiting redistribution but at the same time having the source available is still a good thing.
I see all the advantages of open source, I just dont think theres enough money in it to make a second Microsoft. (unlike what long term VA/RH investors seem to think)
The only big money in Open Source is from suckering investors
Make that: Thats why I see non-free open-source licenses as a good thing...
This of course does not apply to everyone in the Linux community because you can never keep everyone happy all the time unless you're only concerned with yourself (which you should be). But the bottom line to keeping the Linux community happy is that you can't. The Linux community, the majority of the users not necessarily the developers (at least none I've read about), are simply un-aged curmudgeons. They want to hate anything and everything. If they say the things name in a room and one other person in the room has heard of it, they will jump ship. Its just the way they go.
In addition, the only solution to keeping the more sane people who actually do benefit from the rock-solid stability and the open-sourceness of Linux is self-sacrifice. If you do anything but bleed yourself dry until you're dead, you're viewed as a heretic. See the recent story on Amazon.com's founder being made Man of the Year and the response of the Slashdot community (almost synonymous of the Linux community), the only reason they hate the guy is because he made money. The Linux community is anti-capitalist and all about communal sharing. 1st thing that happens in a communal setting where everyone is treated equally and all, is brain drain. The smartest of the community realize they are working thankless jobs for the benefit of people that can't comprehend what they do, realize they can actually be appreciated and rewarded if they move, and they do, they flee. Communist Russia saw it happen as have every other farcical foray into collectivism have seen. The Linux community will see it too, and they'll be happy then. Why? Why would they be happy for losing their smartest developers? because their mantra is that if its open source, it will be improved upon by mystical forces about which they know not. Sorry, but 99.9% of Open Source projects never have more than 1 maintainer and they usually die quickly. Linux wand the 2 or 3 other big projects are flukes.
Well put. The starry-eyed FSF zealots' petulant insistent of GPL-or-die ideology disrespects the tremendous amount of free software out there which wisely chose not to submit itself to the onerous yoke of the GPL. The zealots would have you believe that the GPL is somehow "better" in some moral sense because it makes it illegal to think bad thoughts. They don't really understand morality very well.
Redhat may be the best of the Linuxes when it comes to a coherent operating system, but by the same criterion, it's still the worst of Unixes.
I agree that VA is a much more solid company, both financially and ideologically, than Redhat.
NAme me one reason why we should pay attension to anything Tom has to say. He has the gall to make money from free software, but does not even support the FSF. He writes closed-source, proprietery documentation. He refuses to turn his books over to the FSF to help humanity. He's part of the O'Reily hive mind. All they care about is using other people to make themselves better off. This hurts us. Everything Tom says is a trick to make him more money. Parasites like him and Tim O have nothing to say to us.
I begin to wonder whether the reason that these Linux operating systems are such a hodge-podge is because they're open source!
Redundant like hell. Show us where this thought just duplicates another posting. Just because you get a kick out of marking down somebody whose name you recognize, doesn't mean you are supposed to do this. Read the fucking moderator guidelines, twit.
...it's their fault for buying shares purely for profit.
What other reason would there be for buying shares in a company?
Ideology? Donate money to a charity, then. At least that's tax-deductible.
I don't invest for fun or to give money to companies I like. I invest so I can afford college educations for my children. I invest so I can retire someday. If you're buying stock to "support" a company, then you're putting that company's financial well-being ahead of your own.
Money doesn't care about ideology. Ideology doesn't pay the rent.
I really loved the highly sanctimonious way Eric Raymond told us he's still carry his own luggage.
Guess what ESR - in Silicon Valley, folks with your cash are all over the place, and hardly any of them torture the world with ridiculous navel-gazing articles.
Really folks, humility is the deepest form of conceit, and it certainly shows with the recent linux IPOs.
If a company feels obligated towards these "shareholders," it will spend more time and IPO money posturing (overspending on advertising, customer acquisition, etc.) for psychology's sake than creating the basis for sustainable ROI.
Eventually the in&out poker players will leave, and real investors may or may not be interested in what remains.
Well, RMS may not have been living on food stamps but is it well-documented that he lived out of his office at MIT while establishing FSF.
I've been reading on mailing lists, where college kids who, of course, think all software should be free, don't want even closed source software companies to make money selling there products which in turn supports their developers. This is ridiculous and both ESR and RMS need to educate people better that coders have to live and in order to live you need to be paid a living. But ESR wants coders not to get paid for work that's fulfilling, he wants you to work on a help desk during the day and then code at night. That's an awful way to live! Especially, if you are a talented coder. You should get paid in a profession that maximizes the use of your talents.
This open source economic "bubble" will surely burst, and I can't wait to see when it does. For open source to thrive, you need the deep pockets of Oracle, Sun, and IBM--the anti-Microsoft crowd. However, once open source starts inflicting on their territories--superior "free" databases and superior low cost servers, the open source guys won't have a leg to stand on. So, it's best that they make as much money now while they can, because it won't last long.
But this high risk speculative lottery-like infrastructure, is why the bubble will burst. In bad economic times, even the sale of lottery tickets won't help better fund schools--they'll be layoffs and cutbacks left and right. Everybody suffers during the bad times, as will open source.
the reason the open source community wants everything for free, is most people that I have noticed don't understand the work that goes into a program.
here's an idea!: why don't I try to get laws passed that force you to work for free, because you "like" it. Remember, most people doing your job don't do it for the money, they do it for the joy of helping others. If you don't, then you are just another money-hungry bastard
hmmm I see something strange here...open source.....communism...no! it couldn't be ?!
better yet!
if you come out with a new invention, you have to reveal exactly how it is created, by law.
isn't that great! I would just love to have a society built on views like this.
You say:
Software will have ZERO bearing on the cost of hardware (other than open source drivers offsetting the need to hire driver authors), so HP will remain.
That's not what ESR is saying. He's saying that because software does have an effect on hardware, in particular, operating systems, Microsoft is doomed. Oracle and other software companies would be in the same position. But what won't people don't see or won't say, it that you can only go so low in charging for hardware or you'll drive yourself out of business. This is the case with Emachines. Oh sure, it's great for them to offer affordable computers to the world but if the cost of parts for those computers exceeds the price they're selling them at, the result is easily predictable. So what Emachines and other companies are doing is teaming with advertisers to chock the system full of those annoying ads, in the hope that the person who was duped for the upfront lower hardware cost will be tempted to buy through advertising. In some sense this seems dishonest to me. And of course, the advertisers are dependent upon the merchants. This cycle can only go on for so long until one hits a snag in the food/supply chain. Again, I can't wait for the bubble to burst!
It's going to be harder and harder for small developers to get started if they don't have financing. And open source, blows away their reason for exisiting. Here's why. Because the public believes that since software is free why should I pay someone to develop software. They believe since software is "free" why should I have to "buy" software. End result: small developers without deep pockets/financing are ruined. Nobody wants to pay them because the programs are "free" on the web.
Congrats on the bonus! But don't you think that's cheating. You took code someone else developed so that you and your company can make a profit. OK. The original developer's intention was to make it freely available to the world. What in turn does the developer get? Does your company acknowlegdge his/her efforts? Does your company contract their services or use their other (possibly) for-fee products. Yes, free open source software is great, in that it enables a lot of people like yourself who probably didn't know how to write the equivalent software yourself to get instant fame and glory. But a lot of honest observers of the open source movement are seeing that open source does not encourage innovation only duplication of effort.
Instant gratification is the "root of all evil."
Good luck finding a community an order of magnitude large enough to produce a product to destroy Oracle.
My Question:
How the hell would this work. Many, many users would be satisfied with the product as presented or extend the product themselves.
Therefore: What price would company A charge to add features? To stay profitable it had better be something incredibly high. Oh, whoops, since the source is available to everyone, there will be competition in who gets to add that feature.
There are, however, some very interesting niche's that the GPL would work very well in. From medical analysis, to academia, to retail sales and allocation tracking, to embedded systems adaptation.
Why? Because competition would never be prevalent enough to spoil the economic incentive to continue to release GPL'd code.
I'm fairly confident that the market will eventually realize this. When this correction occurs, is of course, unknown.
Free software has its place -- but it's most certainly not at the center of business. As a means to leverage income using other means maybe -- but not at the center.
Hasch e Witzle gmacht? (Suebian for: "are you kidding")?
Why do companies like RH and VA care for what the shareholders say? Because otherwise everyone will sell, and the management's shares will go south too. It's that simple.
These companies could disappear today and I would
still be (relatively) happy because I still own
the software and know that there is a community
who is also using it.
As long as people are focused on the product and
give a strong preference to GPL'd software, there
is no way to hurt the "community"...
Mark
But, cannot they also justify keeping their code GPLed for the good of their shareholders? This is pretty obvious for us open-sourcers, but hoepfully the businesses can see it this way. If a company takes their super-cool linux installer, for instance, and modifies it to make it more-super-cooler, than the first company can take these modifications back, to sell an even better product and thus earn more cash, making the shareholders happy. I hope this sort of thinking permeates the shareholders and company's minds, rather than just thinking of short-term gains (questionably) made by keeping things proprietary.
just my $0.02
Forget giving into greed.. When will these companies make a profit? I bet it's hard to make a profit when you're selling free software. Egad, what a concept.
If you think about it, what differentiates distributions is the installer and documentation. God help them if Linux suddenly develops a half decent interface and becomes as easy to install.
:-)
That's the beauty of Red Hat and VALinux going public. You have a shot at a piece of the pie now. Granted, it's the same shot that my dad has, and lord knows he's never coded any GPL linux-ware....but still, you have a chance now. I think that a class action lawsuit would be 1) against the spirit of the linux community and 2) Shot down pretty fast. You never coded your GPL software with the expectation of getting paid, and even Red Hat offers it for free...so they're not making money directly at your expense.
Werd.
My thoughts with regards to small-developer dissolusionment (or lack thereof):
Money and greed corrupt....sure, we all know that. But we also know that money is a reasonably successful motivational factor, and a very appreciated reward system. Small developers will become more plentiful with the allure of money now dangling from the stick. And some existing developers (as well as the new ones lured in by $) will be more motivated to turn out great code. Those that aren't driven by money will stay the same. There will be a select few that are corrupted by the greed...but I don't see them gaining the upper hand in Linux development any time soon.
Something to think about:
Was it the allure of money that sent the windows world from a primarily free-ware model in the late 80s to a primarily shareware model in the 90s? Because that is something I would hate to see in linux. The abundance of shared, free software and the helpful community attitude toward it would be somethign I'd hate to lose. My own gut tells me that the spectre of the GPL and the momentum of the community as it currently stands will help to thwart the shift...but you never know.
Werd.
Because that is what publically owned companies do. When you sell your shares, you are saying "Buy part of me, and I'll lead you to riches." If people buy your shares and then you thumb your nose at them, your overall value as a company will decline.
Most shareholders with any sense will be aware of the GPL and the -different- nature of Linux. Those who aren't are going to get burned, but it's their fault for buying shares purely for profit.
WRONG. Most shareholders buy shares of a company PURELY for profit. Our feel-good Linux companies are no different. You doin't shell out $5000 for Red Hat shares just because you like them. You do it for one of two reasons....which both have the same result. Either you buy Red Hat because it's the hot thing (in which case you have ZERO knowledge of the GPL) and hope to make money. Or, you buy Red Hat because you like their corporate stance, think they are headed in the right direction long term, and hope to make money. The stock market is about only one thing: dollars. Shareholders want them, and Red Hat is obliged to provide them to the best of their ability.
Werd.
"If you have to work on closed-source to eat, there's a powerful incentive for you to concentrate on that closed-source work."
Otherwise known as a contract of employment. I do believe even OS companies have contracts for their staff.
Sure, BigEvilCompany may not be very thrilled about me working on OS projects in my own time, but...
Do you think RH looks kindly on its core developers deciding that frankly SuSE is more interesting and doing work on SuSE in their spare time? I doubt it very much. Sure, I don't suppose that's much of a problem at the moment, but it will be once more companies are open source. At the end of the day you spend your working time doing what your company wants you to do. The GPL may or may not help that time be of use to others.
-----
The point is (I think) that while everything you say is true, it is still true if you simply replace 'GPL' with 'Artistic License' or 'BSD license'.
If everything RedHat did now were under the BSD license, and RH were bought up by MS, then all the BSD stuff would be ours to continue working on and with. Sure, MS might do a close fork, but that's a whole other issue.
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I beg to differ:
"For one thing, it's a great motivational boost to know that what you are doing could make you mega-rich. Some people like that kind of incentive. "
Yes, and more's the pity. So there is AN hacker working hard on his new app, and he thinks to himself 'Well, I reckon I should use libfoo becuase that's a well made library - but - gee MegaDistro, the most populat Linux distro has gone down the libbar path. So, If I make my app use libbar in stead, my app might get included in the MegaDistro distribution, and they might employ me or give me little sweetners or 'goodwill stock options' so yeah, I reckon I'll dump libfoo.
Lovely.
"Secondly, it is clear that the open source movement as a whole will benefit from the injection of cash and corporate credibility that these kind success stories bring. It's a necessary step in maintaining the progress of free software."
Rubbish. Your definition of progress is not the same as everyone else's. I write free software to make people (not least myself) happy. I don't do it to crush MS, I don't do it so I can become one of the high priests if the OS cathedral like ESR and AC, and I sure as hell don't do it for the fucking silicon value mickey mouse money stock options.
"But most importantly, it is clear that the business model of firms like Red Hat rely upon the goodwill of the open source community."
No. RH has not been in existence long enough to prove a business model one way or another. RH is currently a vapour company. It makes losses. MASSIVE LOSSES AND INCREASINGLY LARGE LOSSES. Its stock rides on publicity and vibe. I'll readily admit that good publicity and good vibes rely upon the goodwill of the OS community. But as for the business model, we'll wait and see.
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It's a small world and it smells funny; I'd buy another if it wasn't for the money; Take back what I paid (SoM)
One of the unexpected consequences from the IPO craze has left me puzzled. How do you explain why a letter was sent to you? It is difficult to express my value system to someone who only sees the monetary reward. I actually found it easier to joke about losing $11,000 on that Thursday. A few people actually recognized the stock must have been worth more than that before it fell.
Too many people think about making money in the stock market and forget that it also is a place for investment. I seem to have some vague memories from school about it being the place where capital is put to productive use ;-)
I'm going to make a bit of a leap here. I'm going to suggest that it is a good thing to make money on Open Source. It is a good thing because that means that the market sees value in it, that the market is willing to bet that Open Source will work in the long run and will indeed prove the most effective business model for most software projects. If entities A and B both write some program (say, to let you browse newsgroups) and A's program is proprietary and B's program is Open Source, if I need some piece of added functionality (the ability to view HTML messages, say), I now have 4 options:
- License the source from entity A for thousands of dollars and add it myself.
- Ask entity A to do it, possibly paying him a good deal of money for it.
- Pay entity B to add the feature to her program.
- Change B's source on my own.
To the business man, option #3 is likely to become increasingly appealing: I don't need to maintain the fix (because the changes are being examined by hundreds of other eyes) and I can probably "bribe" the developer a relatively small amount to get the feature added. Ultimately, this makes it viable to make a living off of Open Source programming.I sincerely hope that many good programmers become very comfortably wealthy in this way. Companies get better, cheaper code, developers get to pick out the projects they want to work on on a contract-style basis, and everybody gets robust, fully-functional programs.
If Open Source really does work, then it will prove itself in our capitalist economy and will subsequently receive its economic due -- which could be staggering: we haven't even begun to see what kind of cash infusions will come to the community! The capacity to create, organize, transmit, and display information will be the primary cause of economic value in the near future; and Open Source software may lead the way...
Better duck, there's a bar of gold flying at you!
David E. Weekly (dew, Think)
David E. Weekly
Code / Think / Teach / Learn
h4x0r for
The problem with Red Hat et al. is not what they will do to Linux. The problem is not even that they cannot make money. The problem is they cannot make the kind of money Wall Street assumes they can make.
People who think Linux may beat Microsoft are hedging their MS portfolios by buying Linux stocks. What they fail to understand is that the reason Linux has been taking market share away from Windows is because MS charges $85 to $200 for an operating system that's worth about two bucks.
The only way they can get away with this is the network effects and the fact they hide the APIs. Once the public realizes they should never put software on their computers unless the APIs are openly published (even if they never understand the value of open source), no one will be able to rip off the computer-buying public again.
Nobody.
Not Microsoft, not VALinux, not Red Hat.
OSes will cost $2 to $15. Word processors will cost $8 up to a high end of 80 or 90 bucks for a full-fledged desktop publishing system.
A lot of people are just trying to get on the next gravy train. Well, the thing about Linux's success is that there shouldn't be a gravy train. People should not be able to take money from others by encrypting their files (that's what a non-open file format is) and holding them for "upgrade" ransom.
Codeslaves unite!
Eternal vigilance only works if you look in every direction.
We know money can corrupt easily. It just depends on who the person is. I think most programmers won't really worry about how much their options are worth, they are just paper anyway. You'll stil have to pay someone who does really good work good money, otherwise they will go elsewhere.
besides with the GPL, everyone can see your work and make snide comments anyway.
Stock price is an arbitrary measure of value. The market capitalization of a corporation is the price per share MULTIPLIED by the number of shares. Thus, VA LiNUX Systems, with a stock price of $199 has a market capitalization of $7.9 billion, wheras Compaq Computer, with a stock price of just $28 11/16, has a market capitalization of $48.57 billion.
Peace and love, y'all
I know that he occassional posts and reads here, to, so if you read this, Andrew, know that your work isn't going unappreciated.
Cmdr, Hemos, etc: Any chance of letting him author some pieces around here?
LL makes lots of good points here. My $0.02 into the pot is as follows . . .
There are three cost/profit points with software:
1) writing it;
2) maintaining it;
3) supporting it.
Microsoft's model is based on charging for the first point, & pushing the cost of the third onto a third party (e.g., you contact Compaq or Dell for help with Windows). Due to their policy of ignoring or thwarting backwards compatibility, they evade the cost of maintaining their code.
``Enterprise level" models charge a token amount for the first point, with the idea of making money on the second & third points. (Last I heard, Sun charges $250K a year just to talk to someone on the phone. I have a hard time comprehending that the average company can use that much support, even if we calculate it as $500/ an hour.)
The Open Source model is that an individual invests her/his time on the first point, then shares the software with the general public in hope that they will repay her/him with help with the second point. And in theory, both parties make money charging for the third point (e.g., teach classes, do consulting, etc.)
As LL points out, the first model is inherently broken: we pay for software that ends up imperfect, & we have no way of fixing -- either by ourselves or thru the company. The second model has a proven track record -- the software is more reliable, & companies make money -- but the price to users in that model is far greater than the one Microsoft uses.
The Open Source model promises a way to meet both desires: reliable software at an affordable rate. The question now, though, is if this model can fulfill this promise.
Geoff
I think I see a trend here. Maybe for them it really would be easier to muzzle the entire internet than to produce p
Look at it this way -- if it weren't for RedHat and Mandrake and Caldera and maybe Corel, would there be as many Linux users in the world today?
I installed Linux on my own machine starting with RedHat 5.1 (having used it before on a machine belonging to someone else for quite some time). They went to the trouble of collecting, packaging, and distributing that CD so I wouldn't have to do all that work myself -- consequently, I have more time to program and to contribute free software.
Now not everyone who downloads packages or buys a CD will write software that belongs to the whole world (I kinda like that phrase), but if a hundred people try free software because of RedHat, and if only one of those people writes something that other people can use, then we're still ahead.
--
how to invest, a novice's guide
Dissent != damage. Competition is what keeps the community strong, and all camps will be better for it. The friction between the movements helps keep the fires hot, and that's not a bad thing.
Ita erat quando hic adveni.
9. Since the software is GPL'd, if Microsoft was to ursurp it, the last GPL'd version would forever be available. Thus, the developers moving to work on other distributions (3) could continue to develop it (under new names if necessary).
Ita erat quando hic adveni.
This is completely beside the point. Software is the *reason* that companies like Red Hat have such enormous value. Without the software, there's no Red Hat. The *problem* is that those who created Red Hat's very foundation, aren't the ones making the money.
Another thing to consider: Red Hat can't require volunteer developers to dress in a particular way, be present in a particular office at particular times, deal with people they dislike, or work on a piece of code that does not interest them.
If a developer becomes contractually involved with a Red Hat-funded project, they can be required to endure any of these.
Look at VA-Linux..what is the difference between VA and Ma+Pa's Korner Klone Store?
VA makes some nice boxes, but face it, so do quite a few other screwdriver shops. Oh, and VA refuses to support anything but Linux, which makes them popular among Linux users, but not-so-popular among the people who buy the other 98% of Intel servers.
--
Business. Numbers. Money. People. Computer World.
Linux and related GPL/BSD developers included with their product permission to use it for gain without compensating the developers. Therefore, you can sit back and let someone else profit from your labor because you said they could. That's part of the Free Software movement. Ask any three-letter-acronym'd personality ;-).
The pie belongs to those who take the risk to make a company, and those who invest. They're the ones who will be sued if they fail to enhance shareholder value or if the company fails to give away what it produces with GPL'd code. The rest of us do it for no risk, no pie. Just for fun and satisfaction.
However, it is simple to reason that publicly traded companies will do whatever they can to increase value for the shareholder. They may or may not stick to "open source values"; "open source values" are irrelavant in that if the executives of these companies will be fired by the shareholders unless they perform. I think we'll see lots of cases of these "linux" companies doing things that shock and disgust the community of developers who got them going. I think it isn't a big deal. Keep on developing forgot the stock the market. It has nothing to offer to the realm of software.
Salon had better watch out! The dude who wrote this piece's name was Leonard. That's only one letter less than Leonardo - which as we all known has been copyrighted by that french firm. I bet Salon's going to get sued over having Leonard write articles.
Kinda offtopic, but I thought it was funny.
They're selling support for their Linux distro, not the software itself. Red Hat offers a perfectly functional and (objectively speaking) complete install for download from their FTP site and any mirrors.
The biggest difference between the free download and the store bought version is what? Support. When you purchase Linux from the store or even from Red Hat itself, it comes with X number of days of support. (My favorite, Mandrake, is no different.)
Digital Wokan, Tribal mage of the electronics age
For all the good that Silicon Valley money earns you if you are forced to live in a revamped homeless shelter. I would bet one of ESR's dollars goes much further than a Silicon Valley dollar does.
Digital Wokan, Tribal mage of the electronics age
Software will have ZERO bearing on the cost of hardware (other than open source drivers offsetting the need to hire driver authors), so HP will remain. So to more precise, we will have superior server SOFTWARE which will not step on HP's, IBM's or Sun's toes.
And if a superior database system comes out for Linux, and Oracle decides to drop support for Linux... WHO CARES???? We'll have a superior database anyway.
On the bright side, it is nice of you to remind us that in the end our superior software will force the improvement or dissappearance of commercial software. (Basically they must evolve or die. Software Darwinism at its finest.)
Since approximately 95% of coders get paid to write software not for resale, but instead for internal use, the existance of OSS makes their job easier. If they can give their boss the desired results by fixing a couple of bugs or adding a feature to an already existing piece of OSS instead of having to author an application from scratch (aka: re-invent the wheel), don't you think that's more likely to earn them a raise rather than the bosses ire for not doing all the work themselves?
My boss knows my mentality and my methods. I got a great Christmas bonus this year. Know why? Because I got the job done in minimum time and delivered the results ahead of schedule. Know how? By using OSS software. Since they were free, I didn't have to tangle with getting the Financial or Operations Officers to approve it. Since they were GPL, I created as many copies of it as I needed to process the difficult tasks in a shorter amount of time.
The results of that labor were viewed very often throughout this Christmas shopping season. And those results remained stable and operational the whole time. It was probably the company's most profitable Christmas yet. Good thing I had OSS available to have it ready to go on time.
> This open source economic "bubble" will surely
> burst, and I can't wait to see when it does. For
> open source to thrive, you need the deep
> pockets of Oracle, Sun, and IBM--the
> anti-Microsoft crowd. However, once open source
> starts inflicting on their territories--superior
> "free" databases and superior low cost servers,
> the open source guys won't have a leg to stand
> on. So, it's best that they make as much money
> now while they can, because it won't last long.
Digital Wokan, Tribal mage of the electronics age
Why should OpenSource be profitable? Because ESR pointed out very clearly that software is a service, not a manufactured good and the bulk of programming time is spent in the maintenance phase. One big problem with corporatism is they have this habit of externalising negativities, what people commonly call privatising the profits but leting risks get lumped on the public. One obvious example is the tobacco industry which has caused ripple efects on the public health system. Hence the domination of a company in addicting the rest of the world on an endless cycle of unnecessary upgrades has got the rest of the industry feeling the impact of the technology arms race and stressed out and aggravated at the code quality. OpenSource can be seen as a natural reaction by the intermediate customers (who are not the hardware manufacturers) but the developers who want a stable and cheap platform in creating new internet services for their end-customers.
Now most people don't object to profits fairly gained and in fact if they are very successful they eventually dominate their market niche and become a natural monopoly. However, bad business practices can easily erode goodwill such as
Fundamentally a company operates in a network of trust (simply to avoid getting expensive lawyers in to guard every silly thing) and creating a toxic wasteground of relationships as a result of dubious activities, no matter how currently profitable in the short term, is fatal to long-term success. Thus it is not so much the profits that annoy people but the means of achieving those profits and the fact that larger organisations carry their fair share of the social consequences of their actions (e.g. oil companies with their environmental policies, manufacturing with their sweatshop practices, software companies with their founder's personality cults.
If OpenSource is successful as a profitable business model then it must indicate that it satisfies the necessary conditions for a sustainable industry. The point is that with the code being freely available, then the only distinguishing factor is the value of their associated services, reputation for sales support and means for attracting skiled staff with a combination of lifestyle and long-term mission/purpose. One obvious analogy is why do doctors volunteer to work for organisations such as Medici Sans Frontiers? Because they believe in the cause. Profits are an interesting metric of value but they can't measure everything.
LL
Is this 'irrational exuberance'? Or is this a new phenomenon?
Suppose these companies never turn an accounting profit or share holders never see a dividend. Would that be money lost? Or might it reflect a non-tax, non-government method of funding society's infrastructure?
Complicated question. There is certainly a huge potential for future growth here. RedHat's capitalization, while seemingly huge, is still only 2% of Microsoft. Is Linux worth that? I think it is worth MORE. But can Redhat generate the profits that Microsoft does? Doubtful. It is a different biz.
When you buy a stock, you are generally buying into the idea of future growth. This is why some companies are selling at 50 times REVENUES while others are selling at 10 times PROFITS. Amazon is priced high not because of what they are doing today, but because of their growth prospects. When the growth rates of these new companies slow, their valuations will mirror those of more conventional companies.
As to the question regarding dividends, these are not anywhere as important as they used to be. Very few technology companies issue dividends. If a company has a lot of extra cash, they typically return the money by buying back stock which drives up the value of the stock remaining in the market. IBM is a master of this game. Companies like this strategy because it is much more flexible than dividends.
Is it a way to fund infrastructure? You bet. This is in fact the essence of capitalism in action. There is no more compelling story than what is happening here today with the funding of the future in these capital markets. It is the palpable action of the invisible hand of Adam Smith operating to remake the world.
Is it irrational exuberance? This is the hardest of all questions to answer because it is something you can only fully determine in hindsight. There is a lot of economic debate as to exactly how rational or irrational the stock market is in setting prices.
My own opnion? There is a lot of extrapolation going on here. While the value in say the internet sector as a whole is probably justified because of the demonstrated impact it is already having on the economy, it is very hard to pick out which companies are going to be the long term beneficiaries of this. You are betting on a horse in a race that has just started. Who knows if your horse will be the winner?
There have been parallels in US history. Two of the best are the railroads and the development of the automobile industry. If you invested in the winners, your decendents are rich today.
if red hat and va linux dont do well who cares ?
would it effect any of the other linux groups ?
probably not.
va linux is very small, incredibly overvalued and
hyped and has so much bigger better competition its incredible what they have done with their stock.
its the individuals who actually spend their time changing and making things better that are important not some lame alternate excuse for them such as a corporate behemoth which aims for only satisfying shareholders which is a bunch of bullshit since in order to make it well you must not limit anything to an incredibly small group.
so, stop hyping linux stocks as if they were so great when the stock (or any other) doing well will not change the quality of what is actually made in the short and long term.
I tend to think that being (public) shareholder driven provides a very strong anti-quality force.
I don't believe it's possible for a short-term profit driven company to produce good quality complex goods. It doesn't matter whether it's open source or proprietary.
Linux programmers who don't like the decisions of RedHat or VA are quite likely to move to other environments like Debian or similar.
I don't see this as being a threat to Linux at all really. Only the public perception of it (which I don't really count as important).
The real problem with the Linux IPO madness is the same problem with the Internet IPO madness. The people investing in these companies at such outrageous pricess are not doing so because they feel the company is a good buy but because everyone else thinks they are a good buy. This type of mentality is the worst kind if you want a stable economy. It is what keeps Allen Greenspan up at nights. It is the same kind of mentality that leads to bank runs, y2k panics, and the Great Depression.
I am not that worried about Jake and Jane work at home day trader. The direct effect they have on the economy is insignificant. I am worried about the indirect effects. I worry about professional fund managers saying things like (from CNBC):
Fund Manager:(In response to why these companies are sky rockecting) I don't know. It's crazy. There is no sound financial reason to pay prices this high for a share of these companies.
CNBC: Yes, but did you get in on these IPOs?
Fund Manager: Well...I couldn't afford not to.
How comforting it is to know that the guy who is managing my retirement is just picking the same thing as everyone else. Gracias for the hard work you did in researching these companies...if you did you do anything at all.
It seems no one really believes that these firms are good companies but everyone believes that everyone else is dumb enough to think they are. These companies current stock prices are part of a self fulfilling prophecy if I ever saw one.
All the market needs is the smallest sign of weakness and the stocks could come tumbling down. What is worse is that one companies weakness (like LinuxOne) could bring down the more legitimate companies (RedHat, at least have revenue and big time backers). Guilt by association.
How could this hurt the Free Software world? Stability is very important to the business world. They need solutions that will last as long as their company will. Big IPOs may get Free Software into many boardrooms but fantastic failures may just as well lock them out. LinuxOne is the next big IPO and they seem very suspicious. If this one falls flat on its face look for the snowballs to start rolling down the mountin bringing the prices of every Linux company with it. This instabilty will cause big business to shy away from it and go to companies that have so much money they could never go out of business (like Microsoft).
On the home market people go with brand name recognition and with follow the herd trends. People buy what other people buy and people buy what they have at work. Lastly, young people may buy what they had in school. The big oems will run from free software as fast as they came to it. People might not like Windows but if their company uses it they will use it at home.
The result of all this ranting is that I feel that Linux IPO madness could be very bad for Free Software and possibly bad for the whole economy.
-- soldack
I don't think so. The only ways I can think of to make a living and use only Open Source code is to work either as a sysadmin/network admin, to produce internal use only software (even that can be tricky) or to work for an Open Source company. These are just the ones that I can think of. Anyone that knows of more please feel free to tell me. /.ers do not need to work? Are they in college and have someone else paying the bills? Must be nice... I had to program my way through college and although my company at the time used some open source software I spent a lot of time writing financial software for the platforms that traders and accountants use. This meant writing Excel and Access Addins, Windows Stand Alone Apps, and a little Solaris work. Was I wrong? Perhaps some have jobs they hate during the day and do what they love at night. That doesn't sound healthy and I know that I couldn't do it. Maybe they have one of the jobs mentioned. What about the rest of us that don't want to or can't do those things for a living?
I like to work on things that will be used on a large scale. I am currently writing device drivers. In order for my company to pay me they must sell the hardware. In order to sell the hardware it must do things better than its competitors. It must do things that its competitors can't. In order to do that the driver must be written to exploit these features. In order to prevent every other company from copying the features that make it better than the competiton the source to this driver must be closed, at least in the start. This is how I get paid. If the drivers were released the product would be copied, not sell as well, and my group would be sent packing.
How are people who want to write software for a living suppose to earn a living? While I find administration fascinating, I do not want to do it for a living. I want to create products that many people can use not just Joe Pharmaceutical Comp.'s employees. Working for an Open Source company would be very neat but I there are not too many in my area and I like where I live. I don't think that I am alone in these sentiments. I often wonder how many
Finally, what is wrong with being paid for a service or product? If I spent hours building something no one would see anything wrong with me selling it. How come if I spend hours writing code to build a software product, there is something wrong with me for selling it?
I am not against Open Source. To the contrary, I think that it is pretty amazing what people have done for free. It is admirable. On the other hand, I think that there is nothing wrong with working hard and getting paid for it. If you have the resources, go write and use only Open Source. That is fine. But if you do not have those resources...do not feel any shame in writing closed source and making a living doing what you love. Heck, you can still write Open Source in your free time!
-- soldack
Yes, and I was a bit amazed at the comment -
> companies like Red Hat and VA Linux are
> substantially increasing the amount of software
> that belongs to the whole world
Really, I don't think so. All of it existed way
before they did. Sure Rad Hat is adding, but it
hasn't add not even 1/100th to the number of lines
of code that everyone else has.
Maybe in the future, they will, but that's yet
to be seen. At the moment, and in the very near
future, they haven't added any significant amount.
"The best part? I became an ordained minister while not wearing pants." -- CleverNickName
What a great thought. Second the motion. I enjoy Jon Katz's writings on /. but AL combines insightful social commentary with a solid knowledge of the technology and coding.
1000 SlashDot sigs
The commercial BSD vendor, Berkeley Software Design, Inc., and Eric Allman's companym, Sendmail, Inc., share several characterics. (Note: I may be wrong about some of the following. Corrections welcome) They both started with free software. They both added proprietary enhancements. The both sell their value-added product as a revenue source. Both give you source code to the product you bought. And both forbid you from redistributing that source or changes to it to those who don't hold a licence.
Two critical questions are:
- What's the current technology transfer? To what extend do corporate BSDI enhancements return to the free BSD distributions?
- If these companies go down, what happens to their code? Licence holders still have the source, but so what? Is it dead?
I think these two cases are worth looking at because they did not start with GPL'd software, and thus were free to create a traditional fee-for-licence business model for their software systems. Are your points cited above relevant to them? Do companies like that matter to free software--and if so, do they help or hinder it? Or is that too facile a question; perhaps they help some things, hinder others?To add one more pair of companies to the stack, consider John Ousterhout's TCL-based Scriptics company, or the Canadian Perl-related firm, ActiveState. My understanding is that there's more technology transfer between these two companies and their core free software roots than might be immediately obvious with the previous pair. I cannot really speak of the TCL world, but in the case of the Perl one, that firm funds not only the salary of the Perl release manager, they also fund development for porting to non-free systems. For example, they've made Perl's fork() call work "right" on Microsoft systems (actually, Microsoft paid for that work!) and have immediately returned those corporately funded enhancements back to the world of free software.
Yes, that means that the current developer release of Perl, version 5.005_63, supports fork(2) with Unix semantics even on Microsoft. Hurray!
If you want other mixed-mode business models, think about Alladin Ghostscript. The interesting issue of licensing is covered in the FAQ. There's also Sleepycat Software, whose database product, Berkeley DB, was used in Netscape with neither credit nor compensation, thus triggering a good bit of bad blood on the authors' parts because of lack of public recognition and appreciate for their work. The resulting `poison pill' licence seeks to avoid a repeat of this unpleasantry.
Now, we have in contrast to those situations, look at companies that are making a business, or trying to make a business, out of GPL'd software. The two most obvious examples, RHAT and LNUX, are hardly typical cases due to their current market valuations, which are obviously astronomically overvalued. But even in their cases, you'll find things that aren't what you would call "free software". In fact, they aren't even open source; look at the way Redhat ships "demo versions" of things without source. Now, I would be willing to argue that this is in fact a good thing because it shows people that Redhat's operating system is a viable platform for traditional licensed software. Others, however, dispute this, pointing out that that software would be orphaned if the company who produces it were to die.
My point is that I believe we now have a sufficiently long list of corporate endeavours which are based, at least with respect to some definitions of the term, free software. That means we have actual cases to look at, not hypothetical cases. I'm sure I've only named a couple of them here. What about other companies? I'm not talking about simple packagers and distributors. I mean firms that do serious development work based on free software. (I would mention Cygnus, but they've recently become an acquisition by Redhat.)
Do we have examples of companies that have died or otherwise abandoned their work in these areas? The university Ingress experience and Britten-Lee? Can we come up with other examples to look at? What has happened to the product of their work? Has it truly gone the way of all things, or did humanity derive some benefit from it?
We must understand that when someone buys stocks from a company he surely is thinking only in terms of how much he will gain in the long term. But this money is in turn transformed in an investment to the company who receive it. The huge sums of money invested in open-source and free software projects are used to contract and put to work a great number of programmers in full time. This is a great opportunity to enhance and produce a great array of softwares. We only must put pressure in these companies so they mantain the licenses GPL'd.
But now imagine that Red Hat, VA and other companies who are basing their profits in the open-source softwares break. Things will continue to develop, not at the same pace, but we still have many developers who work with open-source for the love and idealism that it brings.
This is our power, the power of flexibility. So come to us, Almighty Buck! We are very proud to receive and use you, but when you go away we will mantain our aim to develop good, free and open-source software. Now that we proved the taste of heaven we shall not fall back in hell(i.e. Micro$oft software!).
"Learning, learning, learning - that is the secret of jewish survival" -- Ahad A'Ham
Why don't the developers get together for a class action lawsuit and at least get a slice of the pie?
Didn't the AOL volunteers do such a thing? It seems to me there's a precident here.
It's one thing to bust your ass for your own greater glory, but how can you sit back and watch someone else profit handsomely from someone else's labor?
The bottom line is: Linux developers are building Red Hat's product for them for free. You may be having fun doing it, and it may make you many things, but one thing for sure that it makes you in my mind: a chump.
I like working on cars, but I'm going to go down to Chevy and build their cars for them.
I totally agree with you here. Stock prices are definitely overvalued here. Look at VA-Linux..what is the difference between VA and Compaq? They are both hardware vendors that sell machines configured with Linux/Windows. How come VA linx's share price is in the hundreds and compaq at 20 something? Dooms day is coming and when it comes, watch the people jump out of their high rise penthouse offices...
Is this 'irrational exuberance'? Or is this a new phenomenon?
Suppose these companies never turn an accounting profit or share holders never see a dividend. Would that be money lost? Or might it reflect a non-tax, non-government method of funding society's infrastructure?
Are we witnessing the birth a new type of charity? One that yields slightly more direct returns than traditional charities?
Has anyone the The Leisure Theory of Value by Michael Miller? I think there may be some ideas in it that are very important as we become more of a service-based economy than an manufacture-based economy.
The market doesn't see the potential of open source. The market sees the potential to make profit because of overhyped words and the endless flocks of bleeting sheep.
If they were really thinking about the viability of open source, they would have noticed that many of these companies' business models aren't exactly sustainable.
Of course, with billions of dollars, they should hopefully be able to work out some scheme to eventually turn a profit.
I doubt that most open source programmers do it for the money, at least not initially. There's the canonical motivation of
scratching the developer's personal itch. There are others. Eric Raymond has rightly called open source a gift culture. That is not the only facit of open source economics, but it is an important one. There are some of us, myself included, who want to be heard. That is, to help shape the future directions of software in general. Open source is the single biggest lever out there. If you can offer enough help to see your own good ideas get into a project, there are plenty of open source projects that will gladly have you. And there is glory. I don't mind finding my name on a project web site.
I wouldn't turn down an offer of shares in a new open source company, and I certainly wouldn't mind if it made me independently wealthy. But I don't expect it. Smaller amounts of money from open source companies can still do a lot to motivate me. They can host project web sites, mailing lists and CVS servers. They can give credit to contributers on web sites and in manuals. They can send CD ROMS, t-shirts and bumper stickers. Or even, as the above mentioned article says about VA Linux and Eric Raymond, they can provide a location for open source developers to use to stay in touch and maybe occasionally provide a necessary piece of hardware to keep some person or project going. The bottom line is that I am unlikely to get a big pile of cash for anything I do. So what? Host my project and send me a copy of your distribution. It costs less and funds the goals we share.
The net will not be what we demand, but what we make it. Build it well.
I was impressed. Here is a piece about the open source IPOs that showed a knowledge of what open source is about. He asked some good questions and partially answered them. I think Leonard's conclusion that free software will be here 5 years from now is valid. Regardless of the sucess or failure of open source business models, the reasons that many of us do it aren't going to change. Whether Red Hat and VA Linux will conquer the world or wither and die remains to be seen. I wish them both well.
The net will not be what we demand, but what we make it. Build it well.
It's great that open source software is getting this opportunity to prove that it can be competitive. About a month ago Slashdot posted an article about SourceForge and it kinda slipped by me. I just checked SourceForge out after someone mentioned the site on irc.worldforge.org (no relation :)
VA Linux is NOT joking about making open source work. If open source fails--turns out unable to compete in the long run (quite unlikely IMHO)--it will not be for lack of effort or commitment on VA's part.
I think the SourceForge FAQ offers a lot insight into VA's vision, as seen by the guys at SourceForge. If you haven't checked this out, do it. The SourceForge site may be the OSS "killer app" of 2000. (once again MHO)
numb
This is a non-issue. The absolute price of the stock has nothing to do with valuation. For one thing stocks split, so you could have had half as many shares of Compaq available at twice the price for example.
When people refer to IPO frenzy, "bubbles" about to burst etc. they are referring to market capitalization which is roughly number of shares multiplied by the price of each. New companies with no quarterly earnings (and in some cases such as Amazon, plans to operate in the red for the foreseeable future) have capitalization in the billions of dollars. This is what the orthodox Wall Street logic considers ridiculous.
From this perspective VA Linux and RedHat are clearly overpriced stocks. On the other hand the high-tech stock market has been operating in a very different model. Natural sciences dictate that you cannot create energy or mass-- only exchange between systems. In the stock market so far everyone has been collectively getting richer as if money is being pumped into the system out of nowhere. This is another good reason why people suspect that the bubble will deflate eventually-- it will not burst, we will not have another "Black Monday" but it will all come down.
BluesPower
The article talks about how, whether or not the stock of the big Open Source corporations crashes, whether or not the massive popularity of free software cools, the current contribution of companies such as Red Hat will remain. Why? Because of the fact that their source code is released under the GPL.
Even if Red Hat goes bankrupt tomorrow, all their code will be around for anyone to use. And just as importantly, their code will not be used in a way that is harmful to the Open Source communitiy, such as in a closed source distro by Microsoft or another giant corporation. Why? Because of the GPL.
Myself, I think a little dissent is worth it.
I think that this is a nice thing for everyone involved. In fact, I think it is nicer and more generous to release your code under a BSD-ish liscence than the GPL. There's fewer strings attached, and I understand that.
The GPL says "Here's my code, but I'm going to restrict what you do with it because I don't trust you one bit!" That's not as nice as just giving your code away. Unfortunately, though, I fear that it is necessary, to keep Microsoft or another commercial establishment from closing, altering, and profiting from someone else's code without giving anything back.
If every person and business were generous and ethical and kept high moral standards, then we wouldn't need the GPL. But then, we wouldn't need policemen either. However, we live in an imperfect world, and so the GPL serves a useful purpose.
I don't think that IPOs like VA's and money coming from OSS can repel hackers from doing it. And, even if there will be less people doing it, the code remains. All this stuff on Metalab/SunSITE is not going to disappear. I don't do much OSS these days (I've almost burnt my flame out back in the Amiga days), but I'm official translator of GnuPG to Polish language - I did it when this was a lunatic project to write PGP from scratch, (and I was making $100/month as a student), and I'm gonna continue it when it goes as government sponsored project (and I got a Real Job). There is this anecdote about one of the founders of Sun Microsystems (whatwashisname) who as a company president still would come to office to hack compilers at night. When asked why is he doing this - he had hordes of programmers in company's salt mines, he simply said "I like writing compilers". And that's the way it is.
Well, for one, there are currently 1.66 Billion shares of Compaq (out of 1.69B total) released on the market, as opposed 4.4 Million shares of VA Linux (out of 39.7M).
They are going to have a little while as the stock falls to expected levels, but in order to keep it from bottoming out, they are going to have to start showing some decent profits. A whole lot of people have invested in VA and Redhat, many not out of support for the Linux movement but out of the belief that they are going to get paid. Also, they are put in the unenviable position of showing that there will be lasting support for Linux to the commercial sector. Let's face it, a lot of companies base part of their equipment decisions on how established a product is. While we here know that Linux is reliable and well supported, Joe CEO only knows that there are a truckload of companies that have been doing business for years developing applications or providing support for Microsoft Windows, and Linux is some computer buzzword that occasionally pops up in the Journal. How well VA Linux and Redhat do over the next year will really set the pace for the integration of Linux into the enterprise. Although a large part of the burden still rests on applications developers, it is vital that Linux-centric businesses make a positive showing to establish Linux as a serious platform to operate on.
Deosyne
Let's assume for a moment that Microsoft managed to assimilate Red Hat management (which won't happen, they're neither assholes nor idiots), and they'd decide any further Red Hat development would be closed-source where possible.
What would happen?
So, even if we didn't care (but we do), there would be no reason to go closed-source. Instead, it would mean the pretty much immediate destruction of the company trying to do it.
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The big Linux IPOs are a good thing for small developers.
For one thing, it's a great motivational boost to know that what you are doing could make you mega-rich. Some people like that kind of incentive.
Secondly, it is clear that the open source movement as a whole will benefit from the injection of cash and corporate credibility that these kind success stories bring. It's a necessary step in maintaining the progress of free software. Small developers with their eye on the ball will do well in the open source consulting and bespoke development businesses.
But most importantly, it is clear that the business model of firms like Red Hat rely upon the goodwill of the open source community. Thus, Red Hat will have a big incentive to keep the small developers onside through sponsorships, awards, share handouts etc.
These kind of activities don't cost much for a multi-billion pound company. By cultivating small developer support for their systems, Red Hat et al. will probably get better press and actually increase their share price.
All in all, I don't think there is too much to worry about. Red Hat can't renege on open source principles precisely because the market won't look kindly on any company that chucks it's mindshare out of the window.....
Why don't the developers get together for a class action lawsuit and at least get a slice of the pie?
Thanks for identifying yourself as a newbie not only to Slasdot but also to Linux as well. A quick intro is necessary...Firstly I'd like to know what grounds you want them to sue Redhat on?
Due to the nature of the GPL the developers that have contributed to the linux kernel and the Redhat distro have no beef with Redhat. Redhat has not violated the GPL in any way so that cannot be a reason to sue.
Secondly Redhat hires/supports a couple of the core kernel developers and thus these people have no more reason to sue Redhat than an employee of Dell, eBay, Microsoft or any other multibillion dollar company who draws a salary. Does this mean we can all sue our employers because our company's make millions in revenue while most of us make less than $100k a year? Thirdly Redhat did let developers get a slice of the pie with the letter...read about this here and here.
Now the only question I have to ask is; exactly how and for what reasons are developers going to sue Redhat?
It's one thing to bust your ass for your own greater glory, but how can you sit back and watch someone else profit handsomely from someone else's labor?
If you got the letter you have profitted handsomely since the IPO. If you didn't get the letter, I remember Redhat hovered between 40 & 80 for a few weeks, this would have been a good time to show solidarity for linux and invest in yourself (assuming you're an OSS developer for linux)....and you'd be profitting handsomely as well.
Finally and most importantly, OSS developers i have met were not and are still not in it for the money. I write code and give it away because I like writing code and I want people to use it and if they find any bugs and fix them whooopeee .
Lawsuit, paaah.
Bad Command Or File Name
You've made the first leap: profit (by itself) is potentially a force for good. Profit is just money efficiency, which should translate into resource efficiency. Thus profit can actually encourage conservation, worker education, satisfaction, and autonomy, and technological improvement.
The rest of the story is that our economy also (maybe usually) rewards SIZE, not profit. While size can be a force for good, (economies of scale, gathering of resources for investments that benefit all, stability, etc.) it inherently subverts the efficiency-motivation of profit: while I can be profitable if I use 1 acre to produce 100 bushels, rather than 10 acres, I can be BIG if I use those 10 acres to produce 1000 bushels! And if I don't care to figure out how to be more efficient, I can still be BIG if I use 100 acres of the rainforest next door to produce the 1000 bushels. And, if I concentrate on burning my competitor's crops, or buying his land, I can charge 10 times the price, and be more profitable, too (which will help me get BIGGER!).
The good news is that free software encourages the profitable efficiency (share your code, and you'll have less work to do to fix it, upgrade it, or find other code); but EXPLICITLY discourages (bans, even) consolidation, market-cornering, and hoarding.
Indeed, what's interesting about the free software movement is that it achieves the good of economic consolidation (economies of scale, etc.) without needing the evils (concentration of power, growth for growth's sake.) It achieves this by enforcing cooperative creation and use of the infrastructure of production (general-use software), while allowing competition over providing the products (support of the software, the services the software provides, special-use software).
Profits are a good measure of value, but, unfortunately, it's size that usually gets measured in today's economy: witness the use of GDP growth as the measure of economic health. Shouldn't we use worker productivity and resource-conversion, instead?
"You can't get something for nothing." - my grandfather, on the stock market and Reaganomics.
What I think will happen is the stock will fall, and people getting wiser about overvaluing stocks.
Let's face it. We already had an example of getting rich through programming through Bill Gates. Linux IPOs doesn't change that. What Linux changed was the realization that Free[speach] (I like the way that looks...) software works as a distribution model much more effectively than propriatary software. (I find it Amazing that AOL deals with Netscape and Instant Messenger with such different philosophies. Unless it's a "screw Microsoft any way you can" philosophy...)
No Zen is good zen
Wraps up the positive aspects rather nicely.
More race stuff in one place,
than any one place on the net.
The Salon.com article assumes that the companies new top priority is to maintain their high stock prices. While it is always nice to have a high stock price, many technology companies strongly feel their stock prices are overvalued, Microsoft included. I remember a quote from Steven Balmer a while back actually urging people to consider the price of Microsoft when making investment decisions - he actually said Microsoft's stock was heavily overvalued, and should be corrected (That is of course not verbatim). I strongly doubt that RedHat and VA Linux will be too concerned with their respective stock prices. They all realize if they do not support GNU completely, etc, the community will not support them. I also don't see the publicly-held Linux distributors gobbling up their competition. I can't foresee a lot of mergers in the sector. Just my take though:)
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- James