how do Linux companies earn money

[jamesbon]

I am curious to know how do Linux companies make money.I have Googled it but not very convinced can some people help me understand the business that is done with Linux.

[_outlawed_]

There are a lot of ways, some of which include:

Donations
Sponsorships
Store (selling merchandise like tee shirts, mugs, install DVD/CD, etc..)
Being owned by a millionaire (such as Ubuntu/Canonical :P )

[Cuddles McKitten]

It's just a different business model. Rather than pay to play, it's pay for support, updates, additional capabilities, or the things previously mentioned. Another revenue source which organizations like Red Hat and whoever works on Wireshark use is technological certifications for IT workers.

[kaldor]

I think he's talking about actual Linux Businesses.. not "making money on Linux"

You mean stuff like Red Hat, Novell, etc right?

They offer paid support plans and specialized Linux-based software to business users, in a nutshell. The only big difference between MS and, for example, Red Hat, is that Microsoft makes money on the OS itself as well as support, while Red Hat has it's own Free OS that you get good vendor support from.

Very basic overview, but that's the general idea; you aren't making money on Linux, you're making money on support. Red Hat has a lot of customers. Red Hat is a huge player in the enterprise server sector.

edit:

examples...

Ubuntu support (http://www.canonical.com/consumer-services)
RH support (http://www.redhat.com/consulting/services/)
Oracle support (http://www.oracle.com/us/technologies/linux/index.htm?origref=http://www.oracle.com/us/support/index.html)

If you're a serious business, you'll want something like this.

[maqtanim]

There are a lot of ways, some of which include:

Donations
Sponsorships
Store (selling merchandise like tee shirts, mugs, install DVD/CD, etc..)
Being owned by a millionaire (such as Ubuntu/Canonical :P )
And also selling the support too...

Like a typical software company, a free software company like canonical needs less manpower. Because a lot of volunteers are working for the community and also lots of hobbyist programmers helping the other users. So, like Microsoft, Canonical doesnot need lots of paid employee. This actually reduces the cost.

[ki4jgt]

Don't forget Ubuntu also sells certified training. So you could be certified by the Canonical group. What better to have on your resume?

[mcduck]

They offer paid support plans and specialized Linux-based software to business users, in a nutshell. The only big difference between MS and, for example, Red Hat, is that Microsoft makes money on the OS itself as well as support, while Red Hat has it's own Free OS that you get good vendor support from.


Actually Red Hat isn't a free OS, you have to pay for it. They do have Fedore Core, which is a free version, but if you want Red Hat Enterprise Linux you'll have to pay (for a desktop system that's $49 with no support included. For a workstation it's $179 with no support and $299 with one year's support).

https://www.redhat.com/wapps/store/catalog.html

GPL license does allow you to sell the software. The "free" in free software is about freedom, not about price.

Canonical, however, has chosen to provide the OS itself for free and charge money for support and other related products and services.

[jamesbon]

I think he's talking about actual Linux Businesses.. not "making money on Linux"

You mean stuff like Red Hat, Novell, etc right?

Right you understood correctly.See my problem is I am a normal linux user.A self proclaimed geek who understands a lot of things.I am not able to understand what is the requirement of support when I have any problem I google on net and find a solutions.Some time I post on forums.So what is that which Red Hat or Canonical or Novell do at the name of support.\
I have a local cloud running at my home in a group of few nodes which are basically guest OS.So I can say I use cloud also.
So why is there so hue and cry for support?
Are the companies who purchase tech support not having capable sys admins to resolve the issues?

[mcduck]

Right you understood correctly.See my problem is I am a normal linux user.A self proclaimed geek who understands a lot of things.I am not able to understand what is the requirement of support when I have any problem I google on net and find a solutions.Some time I post on forums.So what is that which Red Hat or Canonical or Novell do at the name of support.\
I have a local cloud running at my home in a group of few nodes which are basically guest OS.So I can say I use cloud also.
So why is there so hue and cry for support?
Are the companies who purchase tech support not having capable sys admins to resolve the issues?

Yes, it's usually companies that want paid support, not home users.

And from a company's point of view paying for support makes a lot of sense, if something goes wrong they have somebody else to blame (or sue) for it... ;)

Also training the company's own employees might easily take more time and money than paid support would, and of course a company has to pay for their worker's time so if the workers are googling for the solutions, that's actually an expensive option, not free. Getting the same answer from paid support will most likely cost less than the time company's own worker spends finding the answer would cost.

[jamesbon]

That is really cool.So if I am an average guy who know linux a bit more and have some trouble shooting experience then I can have my own company :).

[wormyblackburny]

Here is how I would describe it: Linux is like a canvas. When you buy a painting, you are paying for the paint/supplies (additional software) and the artist's time (developers/support). Sure you can use free paint/brushes you find (free "open-source" software), but then your finished painting may not have the colors you want. You could also paint the picture yourself, but are you Michelangelo? That is where the support/developers come in.

You take most Linux distros and you don't just pop in the install cd and bam, you got a running webserver/samba server/DNS, etc... You have to customize and configure all of that or pay someone with the right skillset to do it for you. On top of that, you can open your own art school and make money off of teaching people how to paint rather than just sell your artwork. Some companies like RedHat have their hand in all of it, some are just paint suppliers or artists. Either way, there just isn't much money in selling blank canvases, so why not GIVE away the canvases and bank on the fact that most people will eventually seek out an artist or need to buy paint/brushes?

[wormyblackburny]

Right you understood correctly.See my problem is I am a normal linux user.A self proclaimed geek who understands a lot of things.I am not able to understand what is the requirement of support when I have any problem I google on net and find a solutions.Some time I post on forums.So what is that which Red Hat or Canonical or Novell do at the name of support.\
I have a local cloud running at my home in a group of few nodes which are basically guest OS.So I can say I use cloud also.
So why is there so hue and cry for support?
Are the companies who purchase tech support not having capable sys admins to resolve the issues?

Difference is, when I have a multi-million dollar company that needs high availability systems set up, am I going to hire you based off of your ability to set up a small scale operation. And what about the stuff you DON'T know how to do. Now I have to hire another sysadmin that can complement the skillset you lack and on and on. You pay for support from someone like RedHat because they have the manpower and expertise that if you pay them they will continue to throw resources at the problem FOR you, vs needlessly wasing your money hiring more and more people. Plus, if you are the average VP/HR person, do you really even know what to look for when you hire someone for that job. Can you trust your IT guy to know how to hire any better than that VP/HR person?

[babybean]

Something that has not been mentioned yet is from advertising. Sometimes companies get money for having specific web page as the default browser homepage or some ads on the distro's site.

Also music stores seem to have some contribution :lolflag: