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The Downward Spiral Of Linuxcare? 101
starvo pointed us to a ZD Net story about the recent trouble at LinuxCare. It's got a fair amount of details about all the problems that led to both the CEO & CIO jumping. Linuxcare has been pretty mysterious about the whole thing, so it's nice to finally get some meat to chew on... the article is relatively fair.
Re:it's sad but true (Score:1)
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Re:Use of closed source, waste of money (Score:1)
This really was a case (cited in the article) of poor business practices and poor execution.
Re:it's sad but true (Score:1)
Does ESR have a degree? What are his credentials (beyond his peer standing and the fact that he's an old, old gadfly)?
Meritocracy, schmeritocracy.
I love you bridge game! (Score:1)
Oops, I think I hear someone walking on it now.
George
Re:Open Source Based Company's Should Fail Unless (Score:4)
Less support != no support. Going back to the oft-used "would you buy a car with the hood welded-shut?" analogy, of course a dealer who has monopoly control over servicing a car will make more money than a garage mechanic when anyone who is able to is allowed to service cars. And indeed, people who do know how to service their own cars can do so. But that doesn't mean that you can't make a living being a car mechanic. It just means that you won't be able to become the worlds richest man like Bill Gates using that kind of strategy.
The reality is that most people still need to purchase support for their products. Whether that support is paid for honestly via a yearly contract, or via forced upgrades to the latest version of MS-Office due to incompatible file-formats, you're still paying support/maintenance fees for your software, one way or another. And for those people who can't fix their computer problems on their own, or who could fix it, but don't have the time to do it themselves, there'll always be room for support plays.
Don't forget, companies like IBM make far more money off their professional service department than they do off of selling hardware or software. This doesn't change whether you're using Linux or some propietary software. What does change is the quality of the software, the quality of the support, and the fact that it's easier to support OSS. However, "easier to support" still doesn't mean that any random liberal-arts student is going to be able to support the software. That's why garage mechanics aren't going out of business, even though anyone could (in theory) learn how to fix their own cars.
Re:Open Source Based Company's Should Fail Unless (Score:2)
Let's examine your argument: better engineering means better stability and reliability. Better reliability and stability means less support.
Oops! Assumption that support needs are due to un-reliability or un-stability. Not necessarily true. Many support issues relate to: planning, installation, operation and maintenance of stable, reliable systems. This is the nature of complex, full-featured operating systems and applications.
Sure, a web browser doesn't need a maonthly support contract (or, shouldn't), but a web server might. Why? Is the web server a piece of junk? No! The web server is complex, with thousands of configuration options and optimizations. Add a dynamic and growing work load and there may be a need for expert tweaking to keep up with your business's success.
The point is, complex yet reliable systems may need support not due to engineering shortcomings but due to the inherent flexibility of quality software.
If "one size fits all" you can be sure that "no size fits anyone well". A tailored suit is more expensive and needs much more customization (especially for dynamically expanding clients) but the engineering is doubtlessly the best.
Re:Open Source Based Company's Should Fail Unless (Score:1)
Your basic argument was that open source is in trouble because:
Open source: Low cost, less support needed. / Close source: higher cost, more support needed.
It seems to me that if this is true, customers will continue to migrate towards the cheaper option. In the end, it may be impossible to build "the next Microsoft" using the open-source model, but if your analysis is right, the open-source companies will eventually be the only ones who survive. MICROS~1 & their ilk might also hang in there, but only by converting to the superior model and cutting the fat out of their companies.
OTOH, if this shift fails to happen in the next few years, it will be pretty compelling evidence that ESR was wrong.
Re:Show me the money..... (Score:1)
CP
Was Lack of Focus an Issue? (Score:4)
And right now the V.C.s are getting cold feet. It could be a bad time for LinuxCare to get a boost from outside. On the other hand, they've been around for a couple of years--hardly a random startup.
My subject question about lack of focus has to do with the increasing market visibility of particular brands of Linux versus that of generic Linux. I think that potential buyers now think of things not in terms of Linux--Linux itself is a given--but in terms of Red Hat vs. Caldera vs. SuSE vs. Turbo vs. Debian blah blee blah bloe. Saying you support Linux anymore is like saying you repair cars, when what cautious car owners want is to go to their manufacturer or dealership and get their service done there. Car is the commodity; Lincoln is the brand.
I don't know much about who LinuxCare sells its services to; would it be possible for LinuxCare to improve its revenue stream by becoming a support subcontractor to the companies who have the brand names and market presence? Say they started handling Red Hat's support calls. Red Hat is a known and trusted name at far as Linux goes; companies seeking support for their Red Hat systems would probably want to get support from Red Hat than a third party. Even if they knew the support call was transparently being re-routed somewhere else, there is a certain sense of security when the phone is answered "Red Hat Support Services, can I help you?"
Both companies could win big on an arrangement like this: LinuxCare could handle 99% of all calls themselves, and only bring Red Hat into the situation when things have gotten really obscure.
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Re:they do know their stuff, though (Score:1)
viable business model? (Score:2)
I hate to quote scrip-cha but I think Eric Raymond [tuxedo.org] and Tim O'Reilly [oreillynet.com] are right on regarding the viability of the business model. (Granted, TOR is arguing for a much more expanded services offering, but it's still a services offering.)
Re:The Downward Spiral? (Score:1)
The Divine Creatrix in a Mortal Shell that stays Crunchy in Milk
Linuxcare - who needs it? (Score:1)
Linuxcare is pointless because the tech support is out there all over the place. The few people who need to be spoonfed w/ Linuxcare will get frustrated with Linux and go back to Micro$oft.
I understand that people like Linus and the rest of the Linux "bigwigs" want to make the OS more user friendly and accessable to more people... but I still don't see the basic computer user running Linux as their desktop OS. At least not today...
Re:I'm glad somebody said it (Score:1)
Re:Open Source Based Company's Should Fail Unless (Score:1)
That's pretty good advice for any business. Selling support is a reactive strategy. What is needed is a proactive strategy.
I think that the so-called Linux companies are going to have to evolve into consulting companies. They will have to hire aggressive (but informed) sales staffs to create alliances with established, well known companies (ie IBM and RedHat) in order to survive. Eventually, I can see where these companies either buy up the business of other companies or are bought out buy larger entities like IBM.
Re:Open Source Based Company's Should Fail Unless (Score:1)
Re:I'm glad somebody said it (Score:1)
So did I. What are talking about? I wouldn't misquote you any more than you'd purposely misunderstand me.
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Have Exchange users? Want to run Linux? Can't afford OpenMail?
Re:I'm glad somebody said it (Score:1)
Re:I'm glad somebody said it (Score:1)
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Have Exchange users? Want to run Linux? Can't afford OpenMail?
Re:Was Lack of Focus an Issue? (Score:2)
I will say that Linuxcare had MUCH heavier-handed management than I've seen elsewhere. There was an attitude that people with bad morale will be fired. Not exactly the best way to foster high morale.
The more I learn about Jean-Louis Gassee, the more I think he had things right. A few quotes from "The Quotable JLG" [bedope.com]:
And, given the amount Linuxcare spent in its second round, I found this quote especially applicable:
_Deirdre
FAIR?!!? HAHAHAH (Score:2)
It's great when Slashdot calls something biased or unfair... talk about the pot calling the kettle black!
Re:I'm glad somebody said it (Score:1)
Bootable Business Cards (Score:1)
Re:YACNMMOOS (Score:1)
Open source software is a nice concept, but by it's very nature very few people will be able to make a living by it.
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A stand alone business (Score:1)
On the other hand, the companies that use GNU/Linux solutions also must hire GNU/Linux administrators, programmers and support team members. But where do you get all these people from? Not from Windows users, obviously. Not even from Unix admins since those guys can get a job just doing what they always have being doing: Unix. So basically the companies who use GNU/Linux hire those self taught programmers who run GNU/Linux for years and who already know where and how to get this information. So what is Linux Care to do?
Let me count the ways (Score:3)
1 A new CEO w/23 years exp in a successful but slow moving hidebound bureaucratic company
2 Lots of pressure to go public before the VC cash runs out
3 An untested business model
4 Few if any internal process or business controls
5 A new CIO 3000 miles from the home office developing a business critical function on his own
6 Building a tech support/CRM application from scratch where many components probably already exist. And oh yeah - no real customers to verify any of the basic assumptions or development requirements
Do I have this right? Is there any reason to suppose that success would have been possible? Nope.
Re:Show me the money..... (Score:1)
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Re:Use of closed source, waste of money (Score:1)
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Re:Open Source Based Company's Should Fail Unless (Score:2)
That's the point, it does. Let me ask you this, do you think that there is a market for selling Apache support? Selling support for Open Source Software doesn't work as an exclusive business model because unlike proprietary software most people who have jobs working with OSS have a clue and they have the source or at least have access to people who have the source. This means that unlike IBM and MSFT who can rest assured that if there is a problem with their software their users will have to call their expensive support lines, users of OSS can simply fix the code or ask on a newsgroup and get a faster and sometimes better response from some enterprising hacker than from some tech support flunkie. I see selling Linux support being like selling toys online, anyone can do it but the market will only support one or two major players while the rest will flounder and die.
Re:first! (Score:1)
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Re:I'm glad somebody said it (Score:1)
Re:Use of closed source, waste of money (Score:1)
Do you know the *massive* amounts of money they spent on wacky, closed-source server technology for their knowledge base and other IT projects? (which, I might add, didn't work very well).
Re:kt (Score:1)
I don't think KT was originally hosted by LinuxCare, so maybe someone else would be happy to host it. I'm sure one of the major distribution vendors would be interested.
I'd miss it if it didn't exist too, because I like to keep up on the changes and some really interesting architecture discussions, but I don't want to read 50 messages (or however many) a day. KT provides a pretty good executive summary, provided in layman's terms since the KT author isn't really a kernel hacker himself.
Re:Geeks vs. Suits (Score:3)
I think VCs == suits by definition, and Kleiner Perkins is one of the big VC firms, yes?
Worth starting a thread on the topic of what makes a good suit in a geek world -- not all VC firms are this control-oriented. Cheers
Traditional support is dead.... (Score:2)
I spent many years working for a company offering specialist technical support on a number of platforms to many UK companies.
This was before the internet was popular, when the only resources we had were the manufacturer's technical bulletins, patch release notes, and our own experience. We flourished, because no-one else offered such a proficient service. We must have had 60+ customers, logging fairly technical support calls.
We'd have some very obscure problems to resolve, but always acheived a resolution.
Later we'd get a few other resources to work from, such as messages posted on Compuserve (remember them!).
Then in 1995, customers started to get internet access. Gradually customers use us less and less, as they were able to post to the relevant newsgroup or mailing list, or search dejanews.
No-one would use us any more to obtain patches or fixes. A savvy sysadmin could avoid using us at all, except when things went really wrong and Guru type calls were needed. For the last year there, most of my calls were of this nature.
By the beginning of 1998 we only were still going as we had gained a number of customers from our rival, as they had already decided it was no longer paying. By the end of the year we had one major customer left, and a couple of smaller sites. The company moved into facilities management and bespoke software to stay afloat.
This article is so wrong (Score:3)
What we've seen recently is two things
Yes, LinuxCare doesn't have guaranteed success right now, but neither does Red Hat, Caldera, etc. Most Linux companies are in growth/bleed mode., which is always tricky.
I believe that if LinuxCare can focus on providing a high quality core product, and that is support, they will do fine.
Re:it's sad but true (Score:1)
Steven, while it may not be "fair", the fact remains that people will judge you by the web presense of the organization to which you have choosen to so closely identify yourself with. Especially given the tone of your first post, where you basically sold yourself off as the expert that the experts came to for help, you should expect this sort of harsh judgment from a technical audience.
The current state of your organization's web presence needs to be fixed, or you need to stop including it in your user profile and postings. Until either one of these things happens, you will continue to be judged by your web site.
Lean on your IT people to pick up the ball they dropped and get things up to speed--a stale web site reflects poorly not only on you, but on all at jjjjulius.com.
But you've cut out the "forced" angle (Score:1)
You say:
The problem with this argument is that OSS tends to cut out the forced upgrade angle since bug fixes, product enhancements, and what not are all provided free (as in beer). Therefore, the only support revenue streams you have are (1) purchase at retail of the distribution (i.e. Red Hat Deluxe) or (2) paid support plans.
This is much different than the continuing cycle of support & upgrade with proprietary softare. Don't forget that most, if not all commercial companies (Microsoft included) can charge for the initial retail, upgrade, and ongoing support revenue.
The bottom line is that you've got to sell a lot of software at $75 a pop (with installation support) to even start to make a dent. And you've got to keep doing it every year.
Nevermind (Score:1)
It's a shame (Score:1)
You see, they HAVE to create an impression that American liberties lead to violence, ignorance, and poverty -- it's the most effective way to keep their own citizens from demanding the same liberties.
The same tactics have been employed on a larger scale in China, Cuba, and the old Soviet Union. They created the false impression that America is a place dominated by chaos and prejudice -- no sane person would choose life in a free country over the order and safety of an authoritarian government.
Personally, I'm thankful that I live in a country where people have tasted freedom first-hand and intend to keep it. I'm glad my government's powers were severely limited from day one. I will happily accept the responsibilities and "risks" of my freedom because I want my destiny controlled by me -- not a bureaucrat. I accept the risk because I know the reward is so much greater.
In fact, my only complaint about America right now is the number of citizens who fear their freedom and want to trade it for government-promised security which will never come. How dare these people compromise my liberty for the sake of their own cowardice!? Perhaps they should relocate to the same country as our Anonymous Coward poster here.
All non-Americans who continue to use Slashdot as forum to spread your government and media-generated lies be warned -- I'm not going to sit quietly and let you continue. Keep whatever system of government you want, but LEAVE MINE ALONE.
Re:Geeks vs. Suits (Score:1)
Cheers,
WFE
===========
Re:Show me the money..... (Score:1)
Dave Blau
Re:Use of closed source, waste of money (Score:2)
Also, E*Trade had been a viable company with substantial infrastructure before he arrived.
Remember, he was hired for an air of legitimacy, not for any actual skill. ::rolls eyes::
_Deirdre
Re:OSS=Hard to market (Score:2)
Hint: name FIVE large, publically traded, software-services-only companies. Now, name FIVE large, publically traded software publishers. Name FIVE large, publically traded computer hardware vendors. Why do you think it's harder to find examples in the first category?
The issue, though, is that there's a fundamental economic issue: it's relatively easy to get a group of skilled Linux people to do support, at least on a small scale. With easy entry and exit from the market, there's no real barrier to competition. Thus, in this industry, the tendency toward profit is ZERO. It has nothing to do with whether or not it's OSS.
I don't care what ESR says, he obviously skipped first semester microeconomics.
Having been the financial manager of a business in another industry with similar competition constraints, I can say that cost management is quite critical. Linuxcare didn't get this. They still don't.
_Deirdre
Missing the point, as usual (Score:1)
I've seen a lot of posts about how selling support for free software is not a viable business model, for various reasons I don't care to repeat here.
These criticisms are generally without basis, because the people making them do not understand the nature of the support marketplace or, indeed, what a service&support company like Linuxcare actually does.
Linuxcare is certainly not intending to make money off of setting up GNU/Linux systems for every J. Random Luser. In fact it is better for the service business in the long run if these people are simply given the tools to help themselves, under the assumption that this will grow the marketplace and increase awareness of free software as a viable platform for whatever-it-is-people-are-doing, as well as being good PR for the company.
Where money is being made is in selling expertise to large organizations, often at a "macro" level. At the moment, companies everywhere are scrambling to get on the "Linux bandwagon". (Whether this is a good thing or not is orthogonal to this discussion :-)
These companies generally need the following things:
Coincidentally, this is exactly what Linuxcare does. In particular, see Dave Sifry's recent rebuttal to the Tim O'Reilly article on Linuxcare and open source business...
(Disclaimer: I work for Linuxcare)
Re:Geeks vs. Suits (Score:2)
Lots of tech folks (non-suits) have made money. If they decide to fund a start up that they havn't founded (in exchange for stock) that is suitless VC.
So if you shop a start-up around, and, say, get Eric Raymond intrested in it, that doesn't make him a suit (I'm assuming you didn't think he was one anyway). If he is intrested enough in it to give you money in exchange for stock, and a say in how the compony is run, he still isn't a suit either, is he?
It has happened before (not with Eric that I know of). I have no doubt that it will happen again.
Granted most people who give venture capital are suits. But that isn't part of the definition.
I'm glad somebody said it (Score:4)
And that's putting it kindly. I saw references (I don't remember where) to Linuxcare's vast storehouse of Linux-related problem resolutions and so I used it a couple of times. Total crap. I would guess that less than 10% of the top 5 items returned were on target. And that 10% seemed to be cut 'n' pasted from Usenet postings and mailing lists.
An LC employee is quoted as calling the "knowledge center" a "simple search engine", but even that is giving the tool I used more credit than it deserves.
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Have Exchange users? Want to run Linux? Can't afford OpenMail?
Re:Open Source Based Company's Should Fail Unless (Score:1)
Also, I had no idea that linux was being used on the Enterprise since it hasn't even been built yet. If that's not a plug for linux I don't know what is!!
Since you have such great Federation connections, though, do you know where I might get some gagh?
ooky
Theyusedtocallmetrickykid/Ilivethelifetheywishthe
Show me the money..... (Score:2)
Such an irresponsible comment. As any student in business school will tell you, stock market prices reflect expected FUTURE economic value. They shouldn't blame the market for their poor business decisions or choice of management.
unfortunate (Score:1)
Re:Get a life! (Score:1)
The market is there, just too soon (Score:2)
- Existing Unix/other guru's they may have on staff.
- Hiring 1 or 2 new people to handle it for them.
- Many distributors like RedHat and Caldera would like to sell you support options as well. If a business deals with Redhat, they're more likely to go to Redhat to get their support if they need it.
Consider how this sort of thing working in the Windows world. Only in the past few of years did the concept of outsourcing your support needs to a major company become widely used. Before that, support was taken care of in-house. It's not unreasonable to think that Linux will go through a similar "in-house only" phase.
Eventually, however, the proliferation of Linux on desktops and servers throughout the business world will reach a critical mass, where it will make sense for a business to hire someone like a Linuxcare to come in and save the day. Here's hoping companies like Linuxcare can survive the rough times and prosper later on.
Re:YACNMMOOS (Score:1)
It is not the proper
In fact,
Any time there.. (Score:4)
tcd004
Here is my Microsoft parody [lostbrain.com], where's yours?
Re:OSS=Hard to market (Score:1)
IMHO, with OSS is easier to find skilled people, because there is no way to artificially raise the entry barrier, as is often the case with close source operating systems or other software. The only limit anybody has in becoming expert of some OSS is its capability to understand the source.
This is a VERY GOOD THING, and it goes to advantage of users. But, it also makes very difficult make money selling support, at least for large-scale companies.
It's just an idea, but maybe franchising[sp?] whould work much better. Did anybody tried that?
The trouble at Linuxcare and the Media (Score:1)
The Downward Spiral? (Score:1)
Re:Geeks vs. Suits (Score:2)
Re:YACNMMOOS (Score:2)
//rdj
kt (Score:2)
Re:Use of closed source, waste of money (Score:1)
Re:I'm glad somebody said it (Score:1)
Math is easy when you actually think rather than try to flame blindly.
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Have Exchange users? Want to run Linux? Can't afford OpenMail?
Re:Show me the money..... (Score:2)
And now, from the article...
So, the CEO gambled on the IPO to cover for poor decisions that were made because he was gambling on the IPO, the CIO alienated the IT people by making obviously poor technology decisions[1], and the problem is with, to use your stereotype, the Quake-players[4]. Interesting logic.
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Re:I'm glad somebody said it (Score:1)
Search 1 returns 78 items. Of the top 5 on the list, 0 are on target.
Search 2 returns 123 items. Of the top 5 on the list, 1 is on target.
What's the running total for on target hits among the top 5? 10%. What's the running total for on target hits among the top 10? Well, 1 hit in a sample size of 20 is 5%.
So to answer your question: "...wouldn't that be the top 10 items?"
No.
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Have Exchange users? Want to run Linux? Can't afford OpenMail?
A fiasco! (Score:4)
The only way to get rich, quickly or otherwise, is to put in the leg-work necessary. A fancy name, a few scraps of vaporware and egos that could fill a Black Hole aren't enough to do anything but look stupid.
IMHO, 9 out of every 10 Slashdotters could have done better, with a tenth of the funding, on their own, over a weekend!
If LinuxCare want to have a management team that could get the respect of employees and the markets, they should print out the Linux kernel CREDITS file and find the top 10% (karma-wise) posters on Slashdot. These are the people who understand what is involved, who have the skills to comprehend what is possible, and who could guide LinuxCare in that direction.
(Most people who'd qualify, though, would probably turn their noses up. Anyone that smart would be, by definition, too smart to walk -onto- a sinking ship. If not, anyone want a job bailing water for the Titanic?)
OpensourceIT interview (Score:1)
OSS=Hard to market (Score:1)
Yes, you can start building acqueducts[sp?], starting a new line of business
One problem with selling support for OSS is that a small company of 30-or-so hackers with little or no management/marketing overhead can offer a better level of support than a big corporation, at least locally.
In other words, I'm afraid that OSS does not scale well to big corporations.
This maybe only a problem for Linux corporations, but where would be Linux without them? [I can use my winmodem on Linux because Lucent made it for RH ... ]
Re:Show me the money..... (Score:1)
In other words: You have no value unless you can reasonably expect to make value (ie cash).
When you are creating value, you have cash to pay bills. I would think that they would have at least hired a clerk to write the checks. When you don't have cash, you the clerk can't write the checks.
Constant refinancing without the hope of maintaining a going concern is either stupid or illegal, depending on the circumstances.
And what's wrong with Geeks running a company? Gates, Allen, Dell, Jobs, Wozniak and others have done a fairly good job of it.
Re:I love you bridge game! (Score:1)
Oops, I think I hear someone drinking it now.
Not George.
Re:A fiasco! (Score:1)
Support (Score:1)
IMHO
Re:I'm glad somebody said it (Score:1)
Re:The market is there, just too soon (Score:2)
The trouble with relying on a company like
RedHat for support is that they're
experts in only one linux distribution.
If the correct solution to a problem is
"Switch to Debian", you're not going to
hear that from RedHat.
And while their revenue was drowning in their
loses, at least they *had* revenue (unlike many
a dot com startup). Firing the insane suits
that were throwing money away is pretty much
all they've got to do to become profitable,
and that's what they did.
Too bad they're not publically traded already, or
I'd say "buy".
Re:Open Source Based Company's Should Fail Unless (Score:1)
Certainly. Plenty of unix-oriented consultants already do this sort of work.
Selling support for Open Source Software doesn't work as an exclusive business model because unlike proprietary software most people who have jobs working with OSS have a clue
That's a false premise. Many workplaces use linux, and have employees who couldn't fix a bug or even figure out how to compile a program using the machines. As linux grows, the numbers of these people will grow.
lines, users of OSS can simply fix the code or ask on a newsgroup and get a faster and sometimes better response from some enterprising hacker than from some tech support flunkie.
Good and rapidly supplied information is worth more than a newsgroup posting from a stranger.
I see selling Linux support being like selling toys online, anyone can do it but the market will only support one or two major players while the rest will flounder and die.
Umm..What sort of reasoning are you basing that on? Linux support is already done by many small companies in the computer consulting field. There is little competitive advantage to being large in this field; I don't see why a firm of 2000 consultants would have a greater profit margin (%) than a firm of 20 (The primary advantage of a company like IBM or Sun is name recognition, not size.) Overall, consulting is a highly competitive business with little room for poorly managed companies.
YACOETSTTG (Score:2)
Please moderate this down... (Score:1)
regards,
Benjamin Carlson
Re:A fiasco! (Score:1)
Re:The Downward Spiral? (Score:1)
Use of closed source, waste of money (Score:1)
The other problems plague most start ups: growing too fast, no direction, wasting money. I had a friend who positively had to *work* to get hired by Linuxcare (and he was pretty qualified). They have been funding some open source projects but don't appear to have a theory of why. They have hired some famous people but with no particular rhyme or reason.
Anyway, it should be interesting to continue watching them. I think they can pull it off, but it will not be easy.
"the article is relatively fair" (Score:1)
Can we assume CmrTaco feels any article that is pro Linux or doesn't bad mouth Linux is fair, and any article that sheds a negative light on Linux is unfair?
Your an editor, report the news, dont decide for the
Re:it's sad but true -- a little history (Score:1)
Linux Expo, where they gave away a new
VW -- they need it now to get their people
out to new job interviews. They also gave away
"Linuxgruven" bumper stickers with a tipsy penguin -- are these worth
anything? On e-bay?
Geeks vs. Suits (Score:4)
Open Source Based Company's Should Fail Unless (Score:5)
For the above reasons I have very little faith in any Linux company or other OSS pure-play ever becoming a very dominant company or even surviving for very long. The MSFT Halloween documents got it right when they regarded the commoditization of software as a death knell. VA Linux has found this out the hard way, what it sells is a commodity (a free OS and PC hardware) and now that other PC makers (who have more money, better distribution channels, more marketers, etc) now sell Linux boxes it turns out that VA Linux can't sell more boxes than anyone except Fujitsu Siemens. Now back to OSS companies before I drift way offtopic, companies that sell commodity software aimed at a market of experts then expect to sell support need to have a large source of income in the first place to create a large, well developed support network. Unfortunately, since their only source of revenue is from support but yet has to pay for both development costs and support the chances of such infrastructure being put in place is slim.
To make money from Open Source and become a successful company, a business needs to rely on more sources of income than support for software that is better engineered than its counterparts. Multiple revenue streams are required or else it is all for naught.
Re:They never had a chance. (Score:2)
Go away, and come back when you've got a clue! That might be an appropriate solution for you or I, but to a company that's basing its business around Linux, it's clearly not. They need guaranteed response times, and that's where someone like Linuxcare comes in. Posting a request on a newsgroup, or emailing someone just isn't going to cut it.
Re:They never had a chance. (Score:1)
I'm saying that LinuxCare was a stupid idea, by a bad company, poorly executed.
I know nothing beyond the article, and I'm no Linux geek. Would it be fair to say that it was a bad company and poorly executed, but not a bad idea ?
Does the collapse of boo.com mean that clothes retailing is a bad idea (even though it seems so contagious that the stock markets have caught a cold [ft.com] over it) ? We all knew there were some bad implementations and flakey companies out there, but it doesn't mean that the concepts are inherently broken. The dot.com bubble is much more like the American 1929 bubble over radio stocks, than the South Sea or Tulipomania, simply because there is a basic product under all that hype, and it's a product worth having. Radio recovered in the '30s, tulips didn't.
Who uses these stupid "knowledge bases", anyways?
I would.
I know the Win32 / Web platforms, but I don't know Linux. Right now I have a bucket o'cash to spend on someone who will tell me how to do (secret server-based web-thing) over *nix, and it's better than M$oft's product. I don't want to spend my time on this, I just want to spend my commercial budget on keeping my commercial timescale on track. Answering my need here is a good and reasonably long-term business to be in.
As I said, I know nothing of Linuxcare, but it sounds an awful lot like major pointy hair and yet another dot.com cash bonfire. Nothing new there....
Re:Geeks vs. Suits (Score:2)
Inclined to agree!
But they never really had a chance from the management viewpoint. Kleiner Perkins raped the original founders - they only had ~8% of the company left after KP's "funding". Add to that KP's abysmal choice of CEO and some of his abysmal hires, and things started to get ugly. It was agonising to watch because there was nothing the founders could do. They had no control any more!
Sorry Linuxcare. Great idea. Try to be a bit more aware of control and funding next time though. You know who I mean.
AC.
moderate DOWN (Score:2)
Second, your claim that "LinuxCare was a Ponzi scheme, it needed constant access to new investors, in order to pay its bills." is wrong in at least two ways.
A) Ponzi's don't have any output. LinuxCare did and does have a product.
B) Ponzi's are asymptotically increasing (meaning they just grow and grow, thus the vernacular "pyramid" scheme). LinuxCare was going to IPO just once and then run itself on that money + profits.
Third, geeks didn't (and don't) run either LinuxCare. Did you read the article? The founders of LC hired "Fernand", a former IBM exec (not programmer), to run the company.
--
Have Exchange users? Want to run Linux? Can't afford OpenMail?
Re:Geeks vs. Suits (Score:2)
No flame from here. I think you have this dead on. This was a management problem.
The real clue for me was the refusal to use Open Source products in their infrastructure. I can understand that if your product is open source but you feel that OS strategy is only useful in narrow situations. But linuxcare's whole business model depends on the proposition that OS is better. Those complaints the team raised about OS are pretty much right out of the NT complaints about linux.
So while rushing to an IPO can be defended on a number of grounds, such as trying to facilitate rapid expansion, overconfidence about the company's capabilities, this objection seems to me to be indicative of something else. It looks like they were trying to ride a fad to completion, one they were actually quite skeptical about.
Note that their partners are still quite enthusiastic about the company, despite its weaknesses.
One lesson I've seen appear again and again is that a company is only a valuable as the sum total of its talent. This includes marketting and management talent, but by definition these are social people who usually take care of themselves. Some companies use CTO as the tech advocate to management. Others have people like Jobs. He puts more restrictions and demands on his people than anyone-- but his own skills are excellent, and let him do this.
Reading Red Herring won't help you design a product anymore than watching Nascar will help you design a car. The revolution of last half of the 20th century is not that more jobs are becoming knowledge based, but that external demands and the vastly increased diversity, scope and depth of skills needed in business are turning management into 'just another skills job'.
Re:Open Source Based Company's Should Fail Unless (Score:1)
ooky
"I'll take the rapists for $600, Alex!"
"Um, that's Therapists, Mr. Connery."
Re:A stand alone business (Score:1)
Well this may be the case now, but Linux is gaining momentum quite quickly. Various entities are doing Linux training [including Linuxcare]. In looking at some of the Linux courses now available, many of them strike me as "Linux for Dummies" type classes. I'm sure most people reading slashdot know at least one person who is "trained" on Microsoft products but doesn't know what the hell they are doing. Pretty soon the people coming out of these Linux training classes will be in a similar situation.
It is these people that Linuxcare wants to support. Unfortunately they may just be a little early yet.
Ender
DISCLAIMER: I am an MCSE... but I USUALLY [heh] know what I'm doing...which is why I'm trying to give up NT... anyone know of a 'patch' I can use in the interem [g]
Re:I'm glad somebody said it (Score:1)
You said it, not me.
--
Have Exchange users? Want to run Linux? Can't afford OpenMail?
Maybe Karma does measure something useful (Score:1)
All the high-karma posters have at least one thing in common: they can communicate useful thoughts well. Maybe that's one point that that poster meant to make.
Re:Linuxcare - who needs it? (Score:1)
[SNIP]
but I still don't see the basic computer user running Linux as their desktop OS. At least not today...
Do you see a contradiction here? Or perhaps your cause is mixed up with your effect. I think one thing LinuxCare could do...maybe could have done...is make it so it does NOT have to be that way, so that lusers like me could use a real OS, despite our lack of technical knowledge. Maybe it would even be good for the economy. How many people-hours have we lost due to MS stupidity and buggy software?
Re:Linuxcare - who needs it? (Score:1)
> The few people who need to be spoonfed w/ Linuxcare will get frustrated
> with Linux and go back to Micro$oft.
But who wrote that tech support info? Some of us are now working for Linuxcare. And trust me, the support calls/EMails from Linuxcare customers go straight to the top of my list.
Say 99% of the time, your trouble is not some subtle kernel bug. It's nice to have someone to go to who can handle the other 1% as well.
Rusty,
Linuxcare Employee and Linux Netfilter Maintainer.
Re:Open Source Based Company's Should Fail Unless (Score:1)
Yeah, but can you bet your business on news group replies, which you may or may not get?
I've asked enough questions on Usenet I didn't get any reaction to at all, and I've seen way too much "stop whining, fix it yourself" flames that I could comfortably rely on volunteer support via news groups or mailing lists.
Sure, if a problem isn't critical, I too ask on a news group and try to figure out the solution myself, but when I really need something fixed yesterday, I'd rather have a service contract that guarantees me that my problem gets the appropriate attention. (depending on what service level I'm willing to pay for)
no (Score:1)
DON'T MODERATE OOG!!
Re:Show me the money..... (Score:4)
Because LinuxCare was a Ponzi scheme, it needed constant access to new investors, in order to pay its bills. Therefore, the "stock-market instability" (ie, the unaccountable refusal of investors to throw good money after bad in this case, despite their willingness to do just that in the case of Red Hat et al) was indeed, a major factor in their downfall.
That's what happens when geeks run a company -- they forget about little technicalities like paying the bills in their insane quest for free "open source" solutions. LinuxOne suffered, pure and simple, from a surfeit of Quake-players and a dearth of those annoying, but often useful individuals, who you call "suits". Even though we favour smartly pressed Gap khakis these days.
--montoya
Re:The Downward Spiral? (Score:2)
Microsoft - "Pretty Hate Machine"
LinuxPPC - "Broken"
Debian/PPC - "Fixed"
LinuxCare - "The Downward Spiral"
LinuxOne - "Further Down the Spiral"
xscreensaver - "The Perfect Drug"
the Mac OS - "The Fragile"
Amiga - "Into the Void"
-mcc-baka
i beat my machine, it's a part of me, it's inside of me
i'm stuck in this dream, it's changing me, i am becoming
Re:I'm glad somebody said it (Score:1)
they do know their stuff, though (Score:3)