Page 1 of 4 123 ... LastLast
Results 1 to 10 of 32

Thread: Canonical Business Model for Ubuntu?

  1. #1
    Join Date
    Mar 2007
    Beans
    89

    Canonical Business Model for Ubuntu?

    I came across this review of Ubuntu: http://www.softwareinreview.com/cms/content/view/59/

    In this article, the author makes the following observation about Canonical Ltd.'s business model:

    On a final note, I think there is a serious flaw in Canonical Ltd.'s business model. Any company that provides a free product and intends to make money primarily from support services for that product is not financially motivated to offer something that works well. Ubuntu Linux will never be perfect because if it were, Canonical, Ltd. would have no support services to sell. Why spend money on release testing when you can make money telling customers how to fix bugs instead? Perhaps that is what truly separates commercial distros from the free-of-charge ones; with commercial operating systems you pay for the company's best effort at creating a perfect software distribution, not a company's best attempt to create a product that requires paid support services. The better Ubuntu gets with its desktop configuration tools and user documentation, the less money Canonical, Ltd. will make. Doesn't quite make sense, does it?
    Anyone have a good response?

  2. #2

    Re: Canonical Buisness Model for Ubuntu?

    Any company that provides a free product and intends to make money primarily from support services for that product is not financially motivated to offer something that works well.
    A cynical remark. People's motives are not good, the author is saying.

    Ubuntu Linux will never be perfect because if it were, Canonical, Ltd. would have no support services to sell.
    What company or group of people make perfect software?

    Why spend money on release testing when you can make money telling customers how to fix bugs instead?
    Another cynical remark.


    Perhaps that is what truly separates commercial distros from the free-of-charge ones; with commercial operating systems you pay for the company's best effort at creating a perfect software distribution, not a company's best attempt to create a product that requires paid support services.
    So a company does need support for Microsoft because it's software is so "perfect"? So Microsoft does not make any money off of support?
    Last edited by Sef; April 14th, 2007 at 03:01 AM.
    Learning is not attained by chance, it must be sought for with ardor and attended to with diligence. Abigail Adams ( 1744 - 1818 ), 1780;

    My blog Poetry and More Free Ubuntu Magazine

  3. #3
    Join Date
    Dec 2006
    Location
    Australia
    Beans
    1,097
    Distro
    Xubuntu 15.10 Wily Werewolf

    Re: Canonical Buisness Model for Ubuntu?

    The author is correct in essentials, but over-simplifies the problem.

    All software will have problems. It cannot be avoided. So yes, if Ubuntu improves reliability and compatibility, Canonical will either need to raise its prices or lose money. But the demand for support will always be there, so Canonical is unlikely to go out of business unless it does something completely crap.

    I actually think Canonical should sell ultra-stable business versions and do custom enterprise software development, while the free version of Ubuntu should be for free-range R&D. Similar to what Red Hat and Novell do with their Fedora and OpenSuse distros.

  4. #4
    Join Date
    Nov 2005
    Location
    flying a cubicle
    Beans
    700
    Distro
    Ubuntu 9.04 Jaunty Jackalope

    Re: Canonical Buisness Model for Ubuntu?

    It's common for reporters to misunderstand GPL and most open source business models. I don't know this reporter's background, but I think it's likely they heard the word "free" and ran with it.

    No enterprise would EVER buy a product as important as an operating system without good support. The product must be of high quality, of course... but even a superb product still needs professional support.
    For example, the servers may be working very well, but the sysadmins get log messages they don't understand... who will they call?

    It is possible to make money on open source by selling support, as Red Hat has demonstrated.

    The Canonical model is similar to the older Red Hat model, in that binaries are distributed very freely. Although I don't think they can make much money in the home user / small office space, they are positioned to do well in the enterprise, if they can steal some market share from Red Hat.

  5. #5
    Join Date
    May 2005
    Location
    US
    Beans
    Hidden!
    Distro
    Ubuntu

    Re: Canonical Buisness Model for Ubuntu?

    While this sounds right in theory, in practice it's wrong.

    At my workplace, we use a database program that is closed source, and the company that produces the program majorly cripples the software, to the point of being almost unusable, and our in-house tech department isn't allowed to make their own patches or improve the software at all.

    In order to get basic functionality, we have to purchase "extra" supporting products and add-ins. That's really how some commercial software works. Look at Windows--cripple the OS and then you can make deals with anti-virus companies like Symantec to come in and offer the solution... for a price. Or, worse yet, offer your own anti-virus solutions... for a price.

    The only real motivator for creating a quality product is competition. If Ubuntu makes a crappy OS, no one will use it. They won't pay more for support. They just won't use Ubuntu. They'll use RHEL or SLED instead.

    Proprietary or open source--your business model will suck if there's no competition. Pay more for functionality or security / pay more for support. It doesn't matter. In any case, Microsoft and Apple all charge for support. Don't they also then have something to gain by putting out crappy products?

    The truth is that companies like to pay for support, whether the product is working well or not. You propose to your boss to buy or license a piece of software that has no paid support, and you'll get funny looks and a lot of skepticism.
    Last edited by aysiu; April 14th, 2007 at 04:20 AM.

  6. #6
    Join Date
    Jan 2007
    Location
    Arkansas, USA
    Beans
    62
    Distro
    Ubuntu 9.10 Karmic Koala

    Re: Canonical Buisness Model for Ubuntu?

    For me, an article like this is scanned into my wetware processor and then quickly erased. Generally, the folks that "assert" the type of things this guy is doing either (a) don't understand the design and implementation philosophy of Ubuntu or (b) don't care cause it makes better press. Either way, I usually go, "Hmpph, another idiot with an opinion," and move on.

  7. #7
    Join Date
    Apr 2007
    Location
    Florence, AL
    Beans
    10
    Distro
    Ubuntu 6.10 Edgy

    Re: Canonical Buisness Model for Ubuntu?

    You could argue in a completely cynical way that yes, Canonical may make money from fixing problems with Ubuntu, it is still in there best interest to make those problems as easily fixable as possible for themselves.

    Also, support doesn't include just "this is broke please fix it", it also supports helping customers with custom configurations, patches to packages that aren't in the standard distro, and much more.

    Canonical has all the reason to put out as best a product as they can, as if they don't, people won't want to use it, and they won't have a market to sell their support services to in the first place

  8. #8
    Join Date
    May 2006
    Beans
    Hidden!

    Re: Canonical Buisness Model for Ubuntu?

    If I thought conventionally, I would definetely say, that the author has a point. But I believe there can be a lot more than only money in a business, like happiness, that you do something significant and good for others, that people admire you for what you are doing.

    I just hope, that there is plenty of people, who make donations, because the Ubuntu developers absolutely deserve it.

  9. #9
    Join Date
    Dec 2005
    Location
    Western Australia
    Beans
    11,480
    Distro
    Ubuntu 12.04 Precise Pangolin

    Re: Canonical Buisness Model for Ubuntu?

    It wouldn't make sense for Canonical to ship a badly buggy product.

    Canonical doesn't make money by the number of support calls - it charges a yearly fee for support. Therefore, it's within the best interests to make a good product, so they don't need to keep hiring developers to fix problems for the enterprise customers.
    I try to treat the cause, not the symptom. I avoid the terminal in instructions, unless it's easier or necessary. My instructions will work within the Ubuntu system, instead of breaking or subverting it. Those are the three guarantees to the helpee.

  10. #10
    Join Date
    May 2006
    Location
    Sweden
    Beans
    Hidden!

    Re: Canonical Buisness Model for Ubuntu?

    The article is, of course, not even remotely accurate.

    You don't pay for support because your software has bugs. Bugs are fixed anyway. Every Linux distribution out there, no matter if they're commercial or community-driven, fix bugs. All the time. Even if you didn't pay anything for the OS itself, you still get bug fixes for free.

    The support is there to fix things when they go wrong, or help setting up a system, or installing the new printers. More than that, they're there to take the blame if something screws up badly (and you get to keep your job).

    There is also some misunderstanding of the business model itself.

    Canonical sells: OS + support.
    Microsoft sells: OS + support.

    In Canonical's case there is no cost for the OS itself, but that is actually not very important as long as the customer wants both the OS and the support. The product that Canonical sells is a combination of these two things, and that product costs money. If the product was bad, no one would buy it.

    That's why Canonical cannot make Ubuntu deliberately buggy.

Page 1 of 4 123 ... LastLast

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •