Last time I remember Microsoft was the one using "free" to kill Netscapes position in the browser market. Maybe we are looking at OSS to do the same and proving itself to be not a single bit better than MS, when will the target be companies other than Microsoft that also happen to make profits and money on the new commodity called software that should be supposed to grow on trees and be free for all of people on earth?
Many people ARE working as software engineers for software companies. Take a look at http://www.bls.gov/oco/ocos110.htm#employment
Computer programmers held about 585,000 jobs in 2000. Programmers are employed in almost every industry, but the largest concentration is in the computer and data processing services industry, which includes firms that write and sell software.
Luckily there are still reasons for software companies to hire software engineers, produce software, sell software (for MONEY), fund new products, hire more software engineers...
But with these acts of insanity among engineers.. who knows. May I ask you, are you all feeling like never getting paid to code again? I personally really enjoy working for money but maybe I missed out on something? Not everyone is interested in installing and configuring open source software for a living you know.
Does anyone know if this immaturity is present in other professional working groups such as chemical engineers, doctors, investment bankers, lawyers, biotechnology engineers etc? Or is it just here that people happily give away their talent, skills and intelligence for free use by megacorporations all over the world? Let's all hold hands and pray that the multi-billion-dollar corporations feel a bit better now when they don't have to pay for Word, Excel, Access and Powerpoint anymore.
Great move from a couple of not so streetsmart people. I hope Microsofts engineering team beats the crap out of this challenger.
...Or the few. Or something in reverse, as SPOCK said to Kirk:)
OK. Many good points (combined of course with some fanaticism from the few as in any religious debate.
I'll take on some of these arguments: Consider this: Microsoft charges something like $500 for each copy of msOffice. The cost to create msOffice is static. No matter how many copies of the product they sell, it does not cost the company more money to produce it.
This might be true in some cases but as with most high technology products where the "producing" is very related to the Research & Development of the company, the money spent on R&D is a pretty blind percentage of the revenue and profits. If it drops, so does R&D. In Microsofts case (according at least to Sun Microsystems.. but anyway) a lot of the revenues from MS Office goes into the R&D of other MS products such as Windows Server software (which of course Sun cares extra about). I think you need to talk to more people involved in startups who have solicited money from VC's.
While I have no experience of the US VC-market (other than meeting US VC-analysts and directors over here) I can put 3 successful rounds of financing and a couple of not so successful on my resume as a founder and CTO of a European software company with PRE-money VC-valuations of about $20 million (and wow yes thats right, our company is still around). I know what I'm talking about. You made the mistake to interpret what I said as if I would compete with Microsoft, which I wouldn't (I know that wont pull out the bucks with VCs). The point here is that VCs and investors rely HEAVILY on industry reports and analysis provided by major research companies, combined with the stock performance of major listed companies (such as Microsoft) when making their judgements, if the industry AS A WHOLE is doing good, they usually won't be worried about whether you will later have to share your profits with Microsoft or any other company or be bought out early (the sooner the VC-better). If the major software companies (and their stocks) perform well, so does the probability of your sales forecasts in the VC spreadsheets. Note once again: You doesn't have to sell the same products as Microsoft to be put in the same business category by a VC or investor. "Boring" programs that are expensive to develop with a narrow but deep market must be paid for.
Haha, yeah thats at least some comfort:) but just wait until the exists a BOSS (Boring Open Source Software) group who does the hard work for fame and glory. A run-of-the-mill code-jockey can pretty easily pull down $60k per year in the US. That's more than a hundred copies of Microsoft Office XP at MS's recommended selling price.
As mentioned in another posters message earlier, this is not true. In order to put a money-value on the specific software created by a specific developer, you have to compute the limit of NPV with time set for eternety (the arithmetic serie will converge quite early though if the discount rate used is fairly high) to get the right dollar value today of all the payments partly for the specific programmers feature. Microsoft and other companies can therefore pay a developer up to the sum of NPVs his feature will be worth in all future sales before they cut a loss on his "production". More revenues and profit for software companies leads to:
More jobs for engineers
More venture capital investments
More new companies being started to share (and make smaller) that profit (microeconomic fact actually, despite the position of Microsoft)
I'd love to see any data/examples you have on this. I think history paints a somewhat different picture.
If you don't think about only the top 5 software companies but instead think of the top 5000 companies, the success of a few excellent companies has led to venture capital (and thereby everything from pension funds to wealthy rockstars sweaty bucks) being invested in new and smaller software companies. Some of these have survived and made a profit, others have died. One thing is true though, without the enourmous growth of companies such as Apple, Microsoft and Oracle and a couple of 50-100 more successful companies the investment market for software businesses wouldn't be as nice as it..um is.. no well.. as it has been:)
Investors and VCs mainly look at the shining top companies, they don't have the time to dwelve through the top-20 000-software-companies-of-the-world-list, therefore successful giants and especially those who run really fast are excellent subjects for an entrepreneur riding an elevator with a VC. Further, the billions made by SW companies goes into the hands of Executives, Share Holders and VCs NOT into the hands of the everyday worker. I'm not a class warrior, but let's call a spade a spade.
Yes, I just made that point. The profits of large software companies attract the three groups of people you mentioned above which pretty much equals a positive VC and investment climate for software startups. If the Executives, Share Holders and VCs make money, they're happy, and when they're happy they invest in new companies hoping to get more of the good stuff.
I can assure you that I have made money on free software, no doubt. In what way does that make the above comment a sign of misunderstanding free software?
If a startup has it's budget rearranged and its development software/infrastructure/serverOS/etc costs cut down to 10% of what it would costs to buy that software from Sun, Microsoft, SCO or other companies selling it. Or, if a 45 000 employee blue-chip global company decides to cut its use of Office, switch to opensource DBMS instead of Oracle and other licenced "normal" software products just because the products suddenly appear for free download provided by a group of OSS-advocates; pick your case: the software industry will lose revenues in both.
I agree that there is new software to be developed and that can be done instead of the products and business opportunities being wasted by being given away. But:
If that is the case, why are so many software engineers unemployed right now and how many will be in the future?
What is to say that the OSS-movement can make the call which software to open up for free and which not to? What is there that says that any future products will not also be beaten to death by a bunch of OSS-people who can't stand that a few companies usually make a huge pile of money?
Remember: There is a huge difference between a couple of MSc-students creating firewalls, DNSes and cool OS-derivaties and a Gobal megacorporation that can cut tens of millions of dollars in IT-spending/software-spending by using free software. The step of the OSS-movement into applications and business productivity software will show mainly in the later category, I assure you.
Aren't there better stuff to create and give away than an Office-suite if the goal is to create more business and jobs for people in the software industry and not just to get Microsoft on its knees?
The huge market growth of (proprietary closed source) companies like Microsoft draws a lot of investors to the IT and software industries, maybe its not that bad if they make lots of profits and show VCs and investors that it can be a nice thing to put money into software companies?
Office? Let them have it, they're obviously best at producing and selling it anyway.
Very interesting post indeed. I agree with you 100%.
Software engineers and programmers have to start thinking twice about where their talent goes. The problem with giving away quality software for free is to me obvious. The people who should be welcoming and saluting the open source movement are the senior directors and shareholders of major non-software corporations whose IT-budgets will just be sent down by lots of % by an army of volunteer cost-cutting programmers.
I hope a couple of credits in economics and greed make its way into the MSc Computer Science curriculum, it seems to be very present among other talented, well educated, intelligent working groups such as lawyers, doctors and investment bankers.
First, thanks for your work. I use OpenBSD every day for both workstations and servers. It's hard to beat.
My question is: How did you get started with OS programming? I guess reading books(Such as The design and implementation of 4.4BSD by McKusick & Bostic) together with source is one way to start. But which path did you take and how would you recommend getting into the details, given a solid knowledge of C, application development etc is present?
I think we'll see more things like RedHat happening. A business can finance marketing, manage support, distribution and make the product more available in general. A lame RedHat-user(thereby not saying that they are all lame..) can call in and talk to them like if they were an ordinary Software company. Consider OpenBSD for example, this is a great system and I think it is superior to RH Linux in many applications. Do you think OpenBSD can be in as many webservers, firewalls etc as RH Linux without a commercial business pumping out marketing and support, answering telephone-calls from people wanting to order the system etc(NO there is not such services available any way near RH and other commercial vendors). Now, when it comes to the development of operating systems, not distribution etc, I think that open source has already showed to MS etc that resistance is futile. But don't be surprised if you end up running a distro called FreeBSD 2000 Professional Edition out of some nice box for a couple of hundred$ in the near future. "The Suits" as you call them always finds a way(come on, look at the banners here at Slashdot eh?) and I don't think you'll get them out of the software business for a long long time.
Obviously you have been lucky. I can tell you that register.coms systems are not at all reliable. I have registered several domains with them and the last one (of course I don't use them any more..) ended up being owned by someone wanting to sell it to me for 2000$. The shitty thing is that I registered the domain 1 month before the other guy but since register.coms systems couldn't handle the registration (since they are poorly programmed) and they were not aware of the problem (they are poorly sysadmined), I got like 10 different excuses from their helpdesk and finally they wanted me to send a letter to their president! F*ck that I say. To put it in short: I lost the domain ONLY because of register.coms poor systems. I could even edit the billing info in the ManageMyDomain-service but still the domain had been registered by someone else(who was smart enough not to use register.com). I recommend you not to register any domains that are critical to you with them. They can't handle their systems.
Slashdot Mirror
Last time I remember Microsoft was the one using "free" to kill Netscapes position in the browser market. Maybe we are looking at OSS to do the same and proving itself to be not a single bit better than MS, when will the target be companies other than Microsoft that also happen to make profits and money on the new commodity called software that should be supposed to grow on trees and be free for all of people on earth?
Many people ARE working as software engineers for software companies. Take a look at http://www.bls.gov/oco/ocos110.htm#employment
Computer programmers held about 585,000 jobs in 2000. Programmers are employed in almost every industry, but the largest concentration is in the computer and data processing services industry, which includes firms that write and sell software.
This is really sad.
Luckily there are still reasons for software companies to hire software engineers, produce software, sell software (for MONEY), fund new products, hire more software engineers...
But with these acts of insanity among engineers.. who knows. May I ask you, are you all feeling like never getting paid to code again? I personally really enjoy working for money but maybe I missed out on something? Not everyone is interested in installing and configuring open source software for a living you know.
Does anyone know if this immaturity is present in other professional working groups such as chemical engineers, doctors, investment bankers, lawyers, biotechnology engineers etc? Or is it just here that people happily give away their talent, skills and intelligence for free use by megacorporations all over the world? Let's all hold hands and pray that the multi-billion-dollar corporations feel a bit better now when they don't have to pay for Word, Excel, Access and Powerpoint anymore.
Great move from a couple of not so streetsmart people. I hope Microsofts engineering team beats the crap out of this challenger.
...Or the few. Or something in reverse, as SPOCK said to Kirk :)
:) but just wait until the exists a BOSS (Boring Open Source Software) group who does the hard work for fame and glory. ..um is.. no well .. as it has been :)
Investors and VCs mainly look at the shining top companies, they don't have the time to dwelve through the top-20 000-software-companies-of-the-world-list, therefore successful giants and especially those who run really fast are excellent subjects for an entrepreneur riding an elevator with a VC.
OK. Many good points (combined of course with some fanaticism from the few as in any religious debate.
I'll take on some of these arguments:
Consider this: Microsoft charges something like $500 for each copy of msOffice. The cost to create msOffice is static. No matter how many copies of the product they sell, it does not cost the company more money to produce it.
This might be true in some cases but as with most high technology products where the "producing" is very related to the Research & Development of the company, the money spent on R&D is a pretty blind percentage of the revenue and profits. If it drops, so does R&D. In Microsofts case (according at least to Sun Microsystems.. but anyway) a lot of the revenues from MS Office goes into the R&D of other MS products such as Windows Server software (which of course Sun cares extra about).
I think you need to talk to more people involved in startups who have solicited money from VC's.
While I have no experience of the US VC-market (other than meeting US VC-analysts and directors over here) I can put 3 successful rounds of financing and a couple of not so successful on my resume as a founder and CTO of a European software company with PRE-money VC-valuations of about $20 million (and wow yes thats right, our company is still around). I know what I'm talking about. You made the mistake to interpret what I said as if I would compete with Microsoft, which I wouldn't (I know that wont pull out the bucks with VCs). The point here is that VCs and investors rely HEAVILY on industry reports and analysis provided by major research companies, combined with the stock performance of major listed companies (such as Microsoft) when making their judgements, if the industry AS A WHOLE is doing good, they usually won't be worried about whether you will later have to share your profits with Microsoft or any other company or be bought out early (the sooner the VC-better). If the major software companies (and their stocks) perform well, so does the probability of your sales forecasts in the VC spreadsheets. Note once again: You doesn't have to sell the same products as Microsoft to be put in the same business category by a VC or investor.
"Boring" programs that are expensive to develop with a narrow but deep market must be paid for.
Haha, yeah thats at least some comfort
A run-of-the-mill code-jockey can pretty easily pull down $60k per year in the US. That's more than a hundred copies of Microsoft Office XP at MS's recommended selling price.
As mentioned in another posters message earlier, this is not true. In order to put a money-value on the specific software created by a specific developer, you have to compute the limit of NPV with time set for eternety (the arithmetic serie will converge quite early though if the discount rate used is fairly high) to get the right dollar value today of all the payments partly for the specific programmers feature. Microsoft and other companies can therefore pay a developer up to the sum of NPVs his feature will be worth in all future sales before they cut a loss on his "production".
More revenues and profit for software companies leads to: More jobs for engineers More venture capital investments More new companies being started to share (and make smaller) that profit (microeconomic fact actually, despite the position of Microsoft) I'd love to see any data/examples you have on this. I think history paints a somewhat different picture.
If you don't think about only the top 5 software companies but instead think of the top 5000 companies, the success of a few excellent companies has led to venture capital (and thereby everything from pension funds to wealthy rockstars sweaty bucks) being invested in new and smaller software companies. Some of these have survived and made a profit, others have died. One thing is true though, without the enourmous growth of companies such as Apple, Microsoft and Oracle and a couple of 50-100 more successful companies the investment market for software businesses wouldn't be as nice as it
Further, the billions made by SW companies goes into the hands of Executives, Share Holders and VCs NOT into the hands of the everyday worker. I'm not a class warrior, but let's call a spade a spade.
Yes, I just made that point. The profits of large software companies attract the three groups of people you mentioned above which pretty much equals a positive VC and investment climate for software startups. If the Executives, Share Holders and VCs make money, they're happy, and when they're happy they invest in new companies hoping to get more of the good stuff.
I can assure you that I have made money on free software, no doubt. In what way does that make the above comment a sign of misunderstanding free software?
If a startup has it's budget rearranged and its development software/infrastructure/serverOS/etc costs cut down to 10% of what it would costs to buy that software from Sun, Microsoft, SCO or other companies selling it. Or, if a 45 000 employee blue-chip global company decides to cut its use of Office, switch to opensource DBMS instead of Oracle and other licenced "normal" software products just because the products suddenly appear for free download provided by a group of OSS-advocates; pick your case: the software industry will lose revenues in both.
I agree that there is new software to be developed and that can be done instead of the products and business opportunities being wasted by being given away. But:
If that is the case, why are so many software engineers unemployed right now and how many will be in the future?
What is to say that the OSS-movement can make the call which software to open up for free and which not to? What is there that says that any future products will not also be beaten to death by a bunch of OSS-people who can't stand that a few companies usually make a huge pile of money?
Remember: There is a huge difference between a couple of MSc-students creating firewalls, DNSes and cool OS-derivaties and a Gobal megacorporation that can cut tens of millions of dollars in IT-spending/software-spending by using free software. The step of the OSS-movement into applications and business productivity software will show mainly in the later category, I assure you.
Aren't there better stuff to create and give away than an Office-suite if the goal is to create more business and jobs for people in the software industry and not just to get Microsoft on its knees?
The huge market growth of (proprietary closed source) companies like Microsoft draws a lot of investors to the IT and software industries, maybe its not that bad if they make lots of profits and show VCs and investors that it can be a nice thing to put money into software companies?
Office? Let them have it, they're obviously best at producing and selling it anyway.
Very interesting post indeed. I agree with you 100%.
:)
Software engineers and programmers have to start thinking twice about where their talent goes. The problem with giving away quality software for free is to me obvious. The people who should be welcoming and saluting the open source movement are the senior directors and shareholders of major non-software corporations whose IT-budgets will just be sent down by lots of % by an army of volunteer cost-cutting programmers.
I hope a couple of credits in economics and greed make its way into the MSc Computer Science curriculum, it seems to be very present among other talented, well educated, intelligent working groups such as lawyers, doctors and investment bankers.
Keep on rockin' in the not-so-free world
Hi Theo,
First, thanks for your work. I use OpenBSD every day for both workstations and servers. It's hard to beat.
My question is: How did you get started with OS programming? I guess reading books(Such as The design and implementation of 4.4BSD by McKusick & Bostic) together with source is one way to start. But which path did you take and how would you recommend getting into the details, given a solid knowledge of C, application development etc is present?
Good luck in the future!
I think we'll see more things like RedHat happening. A business can finance marketing, manage support, distribution and make the product more available in general. A lame RedHat-user(thereby not saying that they are all lame..) can call in and talk to them like if they were an ordinary Software company. Consider OpenBSD for example, this is a great system and I think it is superior to RH Linux in many applications. Do you think OpenBSD can be in as many webservers, firewalls etc as RH Linux without a commercial business pumping out marketing and support, answering telephone-calls from people wanting to order the system etc(NO there is not such services available any way near RH and other commercial vendors). Now, when it comes to the development of operating systems, not distribution etc, I think that open source has already showed to MS etc that resistance is futile. But don't be surprised if you end up running a distro called FreeBSD 2000 Professional Edition out of some nice box for a couple of hundred$ in the near future. "The Suits" as you call them always finds a way(come on, look at the banners here at Slashdot eh?) and I don't think you'll get them out of the software business for a long long time.
Obviously you have been lucky. I can tell you that register.coms systems are not at all reliable. I have registered several domains with them and the last one (of course I don't use them any more..) ended up being owned by someone wanting to sell it to me for 2000$. The shitty thing is that I registered the domain 1 month before the other guy but since register.coms systems couldn't handle the registration (since they are poorly programmed) and they were not aware of the problem (they are poorly sysadmined), I got like 10 different excuses from their helpdesk and finally they wanted me to send a letter to their president! F*ck that I say. To put it in short: I lost the domain ONLY because of register.coms poor systems. I could even edit the billing info in the ManageMyDomain-service but still the domain had been registered by someone else(who was smart enough not to use register.com).
I recommend you not to register any domains that are critical to you with them. They can't handle their systems.