Tag Archive | "opensource"

Australian Open Source Report

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Australian Open Source Growth RateWaugh Partners just released the The Australian Open Source Industry & Community Report. The report was commissioned and executed by Waugh Partners, with the financial support of sponsors, NICTA, IBM and Fujitsu. The data was collected by online surveys conducted from October to December 2007. The industry survey was aimed at “companies that sell, support or service Open Source related technologies in the Australian market.”

Jeff Waugh has street cred in the open source community as a GNOME developer and former community manager for Ubuntu. His partner and wife Pia Waugh is a open source advocate and President of Software Freedom International which sponsors the annual open source conscience raising event – Software Freedom Day.

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Socialized Links for April Fools Day, No Jokes

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Open Source Valuations, Competition, Downloads, and Profitability

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And on goes my fascination with open source companies and their valuations…

I was reading Stephen O’Grady’s commentary on open source companies and their valuationsMoney and Open Source prompted by the recent acquisition of MySQL by Sun for $1 billion. He quotes Jeff Gould who logically questions whether Sun can make the acquisition pay-off.

Stephen also quotes a piece from Knowledge@Wharton on the myth of market share.

It is a common practice of many companies to focus their attention on grabbing market share from their competitors. But such efforts can actually be detrimental to the firm’s profitability, according to Wharton marketing professor J. Scott Armstrong.

[From The 'Myth of Market Share': Can Focusing Too Much on the Competition Harm Profitability? - Knowledge@Wharton]

Another logical and thoughtful piece by much smarter people than I. Part of their support was came from analyzing companies that operating in a pre-Internet market. These companies didn’t benefit from the ability to market and distribute their products over the Internet: GE, Dupont, Union Carbide, and Alcoa. They didn’t have digital products an open source licensing and blocking strategy either. The end result of profitability is still valid but I believe the route to profitability may be different for open source companies.  

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Trolltech: Another Open Source Company Get’s Gobbled Up

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QtToday Nokia announced their intention to acquire an open source tools manufacturer, Trolltech.

Trolltech is an open source company by virtue of their dual-licensing of the QT tool kit that is used by a number of products but probably most notably the KDE desktop. Though they do dual license and sell commercial proprietary products as well.

The Nokia deal was reported in kroners (NOK) at 843 million making the purchase worth about $154.4 million in US dollars. 

2006 revenue for TrollTech was 174.1 Million kroners or $38.8 million. I wish I could find final data for 2007 but as it stands the revenue for last quarter and 2006 and the first three quarters of 2007 Trolltech had revenues of 213.8 NOK. 

Barring a blowout fourth quarter that makes the purchase price of Trolltech about 4 times revenue which is a much lower multiple than the recent MySQL, Xensource, and Zimbra acquisitions. Though it does validate the appetite proprietary companies have for open source. 

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About

Mark R. HinkleHello, my name is Mark Hinkle and I am technology enthusiast and executive for Zenoss Inc. the maker of the open source monitoring software, Zenoss Core. This is my personal blog and does not reflect the opinions of my employer. I am also on the advisory boards for open source collaboration software maker, MindTouch and SourceForge, the world's largest repository of open source software.  If you want to find out more you can read my bio

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