Subject: Re: um... whoa?
From: Thomas Lord <lord@emf.net>
Date: Thu, 07 Sep 2006 10:43:54 -0700

David Fetter:

 > I'm betting this will go nowhere.

I'd say it's a toss-up.    They need an early "hit" or two
and a lot rides on their ability to build a brand.

Of course, in broad outline -- the business model
should do very well even if it isn't cambrianhouse that
pulls it off.


 > The "crowds" parts of the system is predicated on
 > assumptions about people's inability to assess risks
 > and rewards that I believe are false.


Could you unpack that a bit?  I don't follow you.

Each of these projects is like a flyweight start-up
and they each offer crowd members equity-for-sweat.
There's nothing new there.   Most fail and hopefully
a few win big.   People in general get failing grades
for picking what start-ups to invest sweat in but,
reliably, a subset of people get honor grades.


 > There's also the "fast follower" issue, namely that
 > anything that gets popular this way will have an extremely
 > short--possibly zero--time when it doesn't face FLOSS
 > competition. FLOSS competition puts large
 > downward price pressure even on outfits like Oracle, which has an
 > entrenched user base and all kinds of muscle which they are not shy
 > about using.


Hate to say, friend, but it wasn't FLOSS that put downward
pressure on Oracle's prices: it was a proprietary database
suite called MySQL.    Moreover, that pressure only occurred
in a tiny part of Oracle's product line.    (Oh, of course, there's
also pressure on Oracle from other proprietary sources such
as SAP but that isn't what you are talking about.)

Nevertheless, empirically, in the space cambrianhouse is
aiming for (web applications), FLOSS has a pretty much
nil record of playing the "fast follower".   *All* of the big
web application hits that make any money and/or attract
any investment are proprietary, many are essentially unchallenged,
and when challenges occur -- they are from proprietary
competitors.     FLOSS lubes the gears a little bit with
commodity platform components but, far from pulling the rug
out from under this new form of proprietary software, FLOSS
has become its servant.

-t