Back in 1999/2000, I used to hear a lot of people asking the question, “How is anyone going to make money off of Linux?” As the market for high-tech stocks crashed, and Linux stocks in particular were ground into dirt, people stopped asking that question. I guess everyone just assumed the answer was, “You can’t — that’s why all of the Linux companies are going out of business.” However, lately I’ve noticed that people are starting to ask that question again.
While it’s interesting to speculate on why this might be happening (Is the economy finally turning around? Has the stock market bottomed?), that has not been my major preoccupation. No, instead, I’ve found myself thinking, “That question is dumb.”
Why have I become so critical of these innocent seekers of knowledge, you may ask? Well, I’ve basically decided that people asking, “How do you make money off of Linux?” (or Open Source) are asking the wrong question.
Please don’t misunderstand. In today’s high-tech economy, I don’t think it’s easy to make money selling anything — open source or not. The reason I’ve come to this conclusion basically boils down to this — Open Source is a methodology, and Linux is a technology. That’s it.
I don’t think it matters much that no one can “own” the intellectual property that is Linux. It’s not hard to look around and find plenty of examples of companies making money with Linux the same way they make money with any other technology they don’t own — by integrating the products they don’t own with the products they do own and selling those.
The first example that comes to mind is Dell. They don’t own Windows, but they make lots of money selling machines that have Windows running on them. And, now they’re starting to make a good amount of money selling servers running Linux.
Of course, the classic example that everyone wants to point to is IBM. They make a ton of money selling, integrating, and supporting all kinds of different technologies, both hardware and software. But Dell, HP, Compaq, and the rest are interesting simply because the point I just made is so often overlooked. The bottom line is that the only company that really makes any money from Windows is Microsoft. To all other companies, Windows is just a means for selling other stuff. Why should Linux be any different?
Getting back to IBM, they are doing some interesting work regarding my second point — the fact that Open Source is a methodology. Anyone who wonders what I’m talking about need look no further than IBM’s Eclipse project (http://www.eclipse.org).
What IBM is illustrating is that open source development methodology is evolving from its roots as a phenomenon driven primarily by individual developers to slowly becoming a corporate phenomenon as well. While I don’t think any of these corporations would say that “all software should be free,” they do see the value in finding ways to share certain efforts and ideas.
So, while I don’t feel confident making any predictions about the economy, or the future of the stock market, I do feel confident about this. It’s time to look beyond the skeptical questions that marked the early stages of Linux’s emergence into the mainstream and to instead focus on what’s really going on. Companies are making money with Linux and Open Source the same way they’ve always made money with any other technology, and there’s nothing magical about it.
See you next month,
Adam M. Goodman
Editor & Publisher
Linux Magazine /
February 2002 / PUBLISHER’S STATEMENT