Subject: Re: Support as insurance
From: Ben_Tilly@trepp.com
Date: Mon, 29 Nov 1999 12:51:21 -0500


Russell Nelson writes:
> Kragen Sitaker writes:
[...]
>  > Do you mean you have sold insurance policies -- support-based or
>  > otherwise -- to free software users?  I'm interested in hearing more
>  > about the experiences from which you have drawn your conclusions.
>
> It's not so much that I was selling an insurance policy and calling it
> that.  It's more that I was selling support and pricing it like
> insurance -- as if people were going to buy it and not use it.  Well,
> actually, some of them didn't, but most of them did.  And the problem
> with selling something for a fixed price in advance is that you have
> to supply it whether you make money or not.

That is why reinsurance could be good for the community.  Free software
encourages the existence of lots of specialized contractors.  I think that
this is a good thing since (among other things) it is a natural way to turn
free software into a business.  Like you, many will want to provide some
sort of warranty.  If they could resell that risk, looking at the prices
for doing so would give them feedback on the realistic cost of such a
policy, plus it allows them to provide a much more solid guarantee to their
customers than their personal resources would permit.

A similar benefit could be recognized from a franchise arrangement.  I just
don't know that free software offers a standardized enough business model
for franchising to make sense.  (Although certainly several Linux companies
are in a position to start an affiliation program for small consulting
businesses to take advantage of...)

Cheers,
Ben