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Open Source Red Hat Software IBM

'Open Source Creators: Red Hat Got $34 Billion and You Got $0. Here's Why.' (tidelift.com) 236

Donald Fischer, who served as a product manager for Red Hat Enterprise Linux during its creation and early years of growth, writes: Red Hat saw, earlier than most, that the ascendance of open source made the need to pay for code go away, but the need for support and maintenance grew larger than ever. Thus Red Hat was never in the business of selling software, rather it was in the business of addressing the practical challenges that have always come along for the ride with software. [...] As an open source developer, you created that software. You can keep your package secure, legally documented, and maintained; who could possibly do it better? So why does Red Hat make the fat profits, and not you? Unfortunately, doing business with large companies requires a lot of bureaucratic toil. That's doubly true for organizations that require security, legal, and operational standards for every product they bring in the door. Working with these organizations requires a sales and marketing team, a customer support organization, a finance back-office, and lots of other "business stuff" in addition to technology. Red Hat has had that stuff, but you haven't.

And just like you don't have time to sell to large companies, they don't have time to buy from you alongside a thousand other open source creators, one at a time. Sure, big companies know how to install and use your software. (And good news! They already do.) But they can't afford to put each of 1100 npm packages through a procurement process that costs $20k per iteration. Red Hat solved this problem for one corner of open source by collecting 2,000+ open source projects together, adding assurances on top, and selling it as one subscription product. That worked for them, to the tune of billions. But did you get paid for your contributions?

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'Open Source Creators: Red Hat Got $34 Billion and You Got $0. Here's Why.'

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  • News? (Score:3, Interesting)

    by Anonymous Coward on Wednesday October 31, 2018 @10:26AM (#57568411)

    Why is this an article? Did these people actually expect to receive compensation?

    • Re:News? (Score:5, Insightful)

      by rhaas ( 804642 ) on Wednesday October 31, 2018 @10:33AM (#57568455) Homepage
      Yeah. Turns out that when you make your software freely available, you do not get paid for it. If you're not OK with that, don't put it under an open source license. This is a feature of open source, not a bug.
      • Comment removed (Score:4, Insightful)

        by account_deleted ( 4530225 ) on Wednesday October 31, 2018 @11:12AM (#57568725)
        Comment removed based on user account deletion
      • by Etcetera ( 14711 )

        Yeah. Turns out that when you make your software freely available, you do not get paid for it. If you're not OK with that, don't put it under an open source license.

        This is a feature of open source, not a bug.

        I feel like this article had to have been written for Millennials. Specifically, for Millennial app devs who've been told by their DevOps teams (which have no system administrators on staff) about this thing called "Linux" running underneath their java calls and JS routines and are wondering why a Google Ad isn't displayed on every 5th bash prompt.

    • Coding isn't royalty based. Even for closed source applications. I would get paid for my time doing development, now if my code makes the company a Billion Dollars I don't expect to be paid any portion of that, because I had already agreed to be paid for my time.

      If you are an Open Source Developer, either someone had paid you for your time, or you volunteered it. Now that someone had profited off your work, you are not going to expect to get paid extra for it.

      Now if we change the business model to a royal

      • by unity ( 1740 )

        Coding isn't royalty based. Even for closed source applications. I would get paid for my time doing development, now if my code makes the company a Billion Dollars I don't expect to be paid any portion of that, because I had already agreed to be paid for my time.

        Yes it can be. I earn royalties on a handful of closed source applications I've worked on. Yes, I put in a lot of extra unpaid work during the devel process of all of them; but it has paid off handsomely over the years. Some of them are 10yrs old, still being maintained and I still get my royalties.

  • by jfdavis668 ( 1414919 ) on Wednesday October 31, 2018 @10:29AM (#57568431)
    I have been using their software since the mid-90s with version 3. I have never paid them anything. I bought a third party book on it once, they may have gotten some revenue from that.
    • by Chrisq ( 894406 )

      I have been using their software since the mid-90s with version 3. I have never paid them anything. I bought a third party book on it once, they may have gotten some revenue from that.

      Exactly the point of an open-source company. If you need all the corporate hand-holding, support, certifications, etc. then you pay. If you don't need it then its free, and you get access to the great documentation that the corporates paid for.

    • I went to a Circuit City and bought a bright red RedHat pack because I did not have high speed internet and mostly iffy downloads. A lot of extra software and a mousepad that was not a cheap foam job either. Bought a CDRW drive from the bargain bin, too. Could not save Circuit City from its death spiral.

    • Mostly the same here. I did recommended support to a large client once and when we called for help with a driver on a 1394 storage system they refused, calling the bus "unsupported". I found a patch on a mailing list, rebuilt the kernel, and installed centos-release instead of renewing. The next major version had an upstream fix.

      I later learned that people bought RHEL in the minority for proprietary cluster tools and in the majority for "somebody to blame".

      After losing too many nights sleep to botched Sp

  • Yes (Score:5, Insightful)

    by shaitand ( 626655 ) on Wednesday October 31, 2018 @10:29AM (#57568433) Journal
    Red hat has hired and payed a huge number of people to develop and contribute to open source code. They've made massive contributions to Linux and are a key part of why it has become what it is today. Fedora/RHEL/CentOS may not be your favorite flavor but the simple fact is that in order to compete against them your favorite flavor adopted things made by them and had to compete with their usability. There are dozens of things in your home right now which are better because of Red Hat's contribution, not to mention all the things you use online.

    I'm not rich because of Red Hat but I have gotten paid. Sadly I was a broke teenager when their IPO happened and the people I strongly advised to get in on it didn't listen.
    • Re:Yes (Score:4, Interesting)

      by habig ( 12787 ) on Wednesday October 31, 2018 @11:11AM (#57568721) Homepage

      I'm not rich because of Red Hat but I have gotten paid. Sadly I was a broke teenager when their IPO happened and the people I strongly advised to get in on it didn't listen.

      This! Note that , although they didn't have to, RH did offer contributors the chance to join the IPO at the time. ALL contributors, not just their inside people. I didn't because I was a broke postdoc at the time, but wanted to: less to make money eventually, but because it'd be cool to own a share of a company that has produced stuff I use daily in the work that I get paid for.

    • by dowdle ( 199162 )
      Just to clarify and quantify... what exactly does Red Hat contribute to?... here's their list: https://community.redhat.com/s... [redhat.com] Not only do they contribute by funding development here and there, they have created many projects themselves and sustained them until they successfully made them into an upstream community. I'm not sure where to find that list but it is a subset of the above link. Any of the upstream project web sites that have a "Powered by Red Hat" type logio in the top right is a good indi
    • Doh! payed = paid, though it might sound more stylish as it is.
  • I've shared source code updates for for-profit companies before, and do not mind if I don't get updated. Same would be true if I had contributed to Red Hat...

    However it does seem like it would really be a great gesture of goodwill, to give some large amount of money (say $10k) to the top 100 RedHat contributors, however they felt like defining it...

    I guess the danger is of course it may make many other jealous, who were just below the cutoff... so maybe it's better just to leave it as is.

    • Re: (Score:2, Insightful)

      by Anonymous Coward

      >However it does seem like it would really be a great gesture of goodwill, to give some large amount of money (say $10k) to the top 100 RedHat contributors, however they felt like defining it...

      Seeing as how they employ a bunch of full-time open source developers, I'd wager that a good chunk of the top hundred contributors probably already work for them.

    • I worked for a company for 6 years, developed many things that helped them stay ahead of the competition, worked to develop good internal relations (in Alabama this is difficult) and educated many in other departments to fill in knowledge gaps.

      I did all of this for a set price per year. Now, whatever that number is, or was, was agreed upon prior to my starting to work there. One day the company sold, and the owner made millions, and I got none of it. But I never expected to get anything of the compa
      • I did all of this for a set price per year.

        That is a good point, but I would also hope that RedHat would be giving employees some kind of bonus for taking the company to a place where that could happen...

        To be clear I am not saying it's necessary, or even that they are morally compelled to do so. I'm just saying it would be a nice gesture and would help the company out by building goodwill for doing something they had no obligation to do.

      • But I never expected to get anything of the company's either, because I already agreed to work for $DOLLARS per $TIME.

        More importantly you were not *at risk*. You were paid for your time whether the company was profitable or not, whether the stock was up or down. Sure you can get laid off if things go really bad, been there done that, but people in that situation have generally been paid for the time they put in.

        In general people prefer more security at the price of smaller payouts (salary and if lucky a modest bonus).

        • Yep. Of course my point is to not work for free. However, if you do find a reason to work for free, then there's probably a heart-felt reason to do it. And with that in mind (in heart), when whatever thing you worked on becomes successful remember that, in your heart, you got paid.
    • Comment removed (Score:4, Informative)

      by account_deleted ( 4530225 ) on Wednesday October 31, 2018 @11:45AM (#57568949)
      Comment removed based on user account deletion
      • They do, just indirectly. What we get is an operating system

        That is a great point and a. good reminder about the value that people who seem to work for "free" are really getting from the work. They probably are not working if they do not benefit from the result itself.

    • by 93 Escort Wagon ( 326346 ) on Wednesday October 31, 2018 @11:47AM (#57568957)

      However it does seem like it would really be a great gesture of goodwill, to give some large amount of money (say $10k) to the top 100 RedHat contributors, however they felt like defining it...

      The top 100 Red Hat contributors may very well already be on Red Hat's payroll - being paid to work on the software they're contributing to.

      I used to really be into building my own RPMs, tweaking existing ones, etc. It was quite a learning experience in many ways... one of which was to note just how often the names of Red Hat employees appear in the changelogs for many, many different software packages.

      • When RedHat went public in August 1999, I recall that many contributors were allocated initial public offering (IPO) shares. It's been awhile, but I believe they were at a discounted issue price.

        "It was clear that Red Hat wanted all the open source developers who
        had made its success possible to participate in its public offering. ...
        Red Hat Director of Technical Projects Donnie Barnes spent three
        weeks scouring the Internet, digging up all the contributor lists to all
        the open source projects he could find. R

    • However it does seem like it would really be a great gesture of goodwill, to give some large amount of money (say $10k) to the top 100 RedHat contributors, however they felt like defining it...

      Most of those people are already paid to do that work... so that'd be strange.

  • by Luthair ( 847766 ) on Wednesday October 31, 2018 @10:31AM (#57568449)
    Red Hat has been one of the biggest contributors in the open source ecosystem for a very long time. For the kernel in particular consider unlike many of the other major contributors they are not writing code to supporting their own hardware.
    • by w1zz4 ( 2943911 )
      Red hat is in fact second to Intel in the Top Business which contribute to Linux dev... Dev that aren't paid for their contribution by any entities are #3 in the same list. Linux need those businesses that provide paid and professionnal devs. Source : https://www.linuxfoundation.or... [linuxfoundation.org]
  • by The Original CDR ( 5453236 ) on Wednesday October 31, 2018 @10:40AM (#57568505)

    1100 npm packages

    What does the Node.js package manager got to do with Redhat Linux?

    • by Torodung ( 31985 )

      I even looked at my keyboard. "N" then "R." Hmm. Nowhere near one another.

      OCR mistake?

      • Maybe they're using a Dvorak keyboard. N and R are both 4th finger, right hand. Top vs Home row. Very easy mistake there. :-)
    • by Luthair ( 847766 )
      I wondered that also, but while they're synonymous with Linux they also have a pretty wide variety of other open source products - e.g. JBoss
  • by PPH ( 736903 ) on Wednesday October 31, 2018 @10:51AM (#57568581)

    ... just got injected into a company that will take a good chunk of it and use it to write and maintain code. Which will be placed back into the OSS environment. I'm OK with this.

    • Re:$34 Billion ... (Score:4, Informative)

      by Anonymous Coward on Wednesday October 31, 2018 @11:17AM (#57568771)

      $34 billion just got handed to investors

    • Re: (Score:2, Informative)

      by Anonymous Coward

      No, 34 billion was the buyout to people who owned redhat stock. It remains to be seen what IBM will do with Redhat, but it's entirely possible they'll screw it all up, and blue-wash it.

      It doesn't matter. If they do screw it up, CentOS will live on.

  • by account_deleted ( 4530225 ) on Wednesday October 31, 2018 @11:01AM (#57568641)
    Comment removed based on user account deletion
  • by Anonymous Coward on Wednesday October 31, 2018 @11:04AM (#57568669)

    Founders of the Atlanta Linux Showcase, which was the main Linux convention in the late 90's, worked their asses off, for free, to make the event happen every year. After a few years Red Hat gave the major contributors some stock, for free, as a thank you. I'm sure they did the same to others, this is just the case I know of.

    In addition, Red Hat hired many contributors to open source, and gave them a good job so that they could continue to develop software, not just for Red Hat but for all of us. Remember Alan Cox? Me too, but there's many more. I'm sure all of those great technical hires got stock and each is getting a bit of the $34 billion.

    Red Hat has always been less selfish and more fair than most software companies. They've always reflected open-source values, IMHO.

  • Comment removed (Score:5, Insightful)

    by account_deleted ( 4530225 ) on Wednesday October 31, 2018 @11:06AM (#57568677)
    Comment removed based on user account deletion
  • It was open source software. Free.

    When they went with the support business model, I knew someone was going to get screwed. "Thanks for making this great piece of software, community, but it needed so much dang support... we'll take the money."

  • by vanyel ( 28049 )

    I was able to get in on Red Hat's IPO because I made a small contribution to net-snmp a couple years before. I didn't get rich, but it was a nice bonus that year.

  • by DidgetMaster ( 2739009 ) on Wednesday October 31, 2018 @03:01PM (#57570305) Homepage
    I am fine with programmers who are willing to contribute to open source projects without any compensation. I am fine with companies like Red Hat that find a way to make money off the generous contributions of others. I am fine with companies paying their employees to work on open source projects that will benefit the company.

    What irks me are all the 'open source zealots' out there who insist that anything closed source is some kind of evil thing. If you build something and take great personal risk to get it ready for market, you are often portrayed as some kind of 'greedy capitalist' if you want others who get value from your product to actually pay you something directly for your efforts. You built it. You own it. If you want to charge something for it, then you better make sure it adds more value than the price you are charging for it. Just don't let anyone tell you that you are less than human for not wanting to just give away the fruits of your labors.
  • Working with these organizations requires a sales and marketing team, a customer support organization, a finance back-office, and lots of other "business stuff" in addition to technology.

    Unfortunately, it also requires Lennart Poettering and whichever spaztard messed up Gnome.

  • by Tom ( 822 ) on Wednesday October 31, 2018 @03:18PM (#57570461) Homepage Journal

    And just like you don't have time to sell to large companies, they don't have time to buy from you alongside a thousand other open source creators, one at a time.

    That is right, they don't buy from me. Because I don't ask for money. They couldn't buy from me, even if they wanted to. I'd just point them to gitlab or github or sourceforge or my own website, depending on what it is they want and wherever I put it.

    And I'm fine with that, otherwise I wouldn't have done it.

    But distributors like SuSE and RedHat were controversial from the beginning because even if the legalese fineprint said something else, they did everything in their power to create the impression that they were selling software.

    I personally don't have a problem with the business model, save that it could be a bit more honest, but this particular blurb someone in PR wrote is just... stupid, insulting and false.

  • I develop for open source projects. I also make my bread and butter from Cisco Call Manager. Call Manager btw is a Linux based PBX. Linux' success is my success. I have no reason to stop contributing to open source in my spare time as I see fit.
  • Time to grab a copy of CENTOS before IBM does what they do best.. lock everyting up in a support contract and kill off whatever they can?

  • I turned the PHBs at RH in to the feds, and still made a lot from the IPO.

    Yeah, it was me. Next time, don't steal.

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