| One simple rule of business: commoditize your complements. Apple sells hardware and "gives away" all their media. Content creators and developers are charged only enough (30% margin) to basically break even managing the system. This adds tremendous value to their hardware since they now have "an ecosystem" and not just some electronic widgets. Aside: Apple have set prices for music but assumed app developers would always charge for their apps. When huge numbers of developers started giving away apps for free, Apple came out with iAds in an attempt to defray the cost of hosting free apps. They don't do anything for free. So, the same applies to open source and hiring. Good engineers are hard to find. If you outsource your software and it becomes popular, good engineers will flock to it. You've now got engineers pre-trained (for free) on an important component of your system and they are dead easy to identify, defraying the cost of recruiting. Since open source is the commodity in this scenario, giving it away for free is the most prudent way of insuring widespread use and a good supply of engineers. Edit: another idea is "give away your ideas, sell the system". Open source your non-core ideas to attract attention and sell your complete system. Although many marketers argue the reverse: give away your BEST ideas to prove your worth and build trust then sell them on the whole package. |
I'm surpised no one else has mentioned that. It's a very powerful idea, and essentially what this blog post is getting at. I don't know if Joel Spolsky coined that phrase, but that's where I first heard it:
http://www.joelonsoftware.com/articles/StrategyLetterV.html