

The sometimes precarious business models for Open Source software - SwellJoe
http://inthebox.webmin.com/open-source-and-business-a-precarious-partnership

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davidw
Nice writeup. It's a tricky area, isn't it? Open source is great - I'd spend
my days working with it exclusively if I could, but in the end, it's all about
scarcity, and where it turns up when the central thing (the code) is by
definition, not scarce:

<http://news.ycombinator.com/item?id=62945>

~~~
SwellJoe
It is tricky, but it's also satisfying. Customers of Open Source based
businesses demand a lot more, too, which is both a blessing and curse.

On the one hand, they feel more entitled, but they're likewise more willing to
be involved in solving the problem because they have some ownership by being
part of the "community". So our customers file bugs or post to the forum, just
like users of the Open Source product do, rather than call us on the
phone...the culture allows us to support it in the most efficient way rather
than the traditional but horribly time inefficient way (the first time you
find yourself describing that "slash" and "backslash" are different
characters, and that "slash" is the one they want for paths on UNIX and Linux
systems is the beginning of wisdom on how inefficient telephone is for support
on a system administration product).

We're in agreement on how scarcity fits into the equation--people simply pay
more if they can't get it any other way. When asked to put a fair price on the
new Virtualmin Professional in the early days, for example, some of our FOSS
users suggested unsustainably low pricing, a quarter or less what competitors
were charging for less functionality. We ignored those folks, and took the
advice of the people who were wanting to escape from the existing products in
the field, and were willing to pay similar prices--they just wanted a better
product. These days, nobody complains about the price. They're accustomed to
paying for Virtualmin Professional now, and have begun to think of it as a
separate product in its own right. It has acquired scarcity that it didn't
have in the beginning when it was only theoretical and the OSS version was
what they knew. ;-)

