Subject: appliance-based business models
From: Rich Morin <rdm@cfcl.com>
Date: Wed, 19 Oct 2005 12:07:34 -0700

At 2:20 AM -0400 10/19/05, David Kaufman wrote:
>Yes, you too can sell your Free Software Business for hundreds of
>millions of dollars.  All you need is a business model like this one.

Bundling software and hardware isn't all that unusual an approach, nor
is it limited to FSBs.  Turnkey solutions appeal to customers because
they provide a simple (and presumably, cost-effective) solution.

The difference, in the FSB version, is that (a) the source is freely
available and (b) the customer is generally aware of this.  So, the
vendor has to make an argument in terms of convenience, support, etc.

What is unusual in the snort/sourcefire approach is that the author has
chosen to create two "universes" of users.  If the customer isn't aware
of the free version, s/he may not be confused about its implications,
tempted to use it, etc.  OTOH, the vendor is prevented from using any
arguments for the goodness of open source (let alone free) software.


I've been noodling about the idea of creating a turnkey appliance for
"mechanized documentation".  Start with a well-known operating system,
then add a variety of (mostly Open Source) tools for data acquisition,
analysis, presentation, etc.

If I had several customers whom I was supporting in this manner, the
maintenance overhead would be shared.  Also, because each system would
have a known tool set and configuration, I wouldn't have hassles with
getting particular tools installed or updated on the client's server.

Problem is, I'm not sure how to charge for the appliance.  One idea is
to require a monthly retainer for my services, counting the appliance
against this (e.g., 10 hours per month, with maintenance and "rent" on
the appliance counting as two hours per month).  Because the other
hours would already be "paid for", this might encourage the customer to
meet with me on a regular basis (e.g., to discuss needs and problems).

I'm sure there are other variations, however, so I'd like to ask for a
bit of brainstorming help.  Real-life accounts are also encouraged!

-r
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