Subject: Re: street performer protocol
From: Crispin Cowan <crispin@wirex.com>
Date: Mon, 22 May 2000 08:40:54 +0000

"Stephen J. Turnbull" wrote:

> >>>>> "Crispin" == Crispin Cowan <crispin@wirex.com> writes:
>
>     Crispin> Consider Lineo vs. QNX:
>
> I can't; I don't have the technical expertise to judge which end of
> the Norman castle wall you're trying straddle is more plausible, let
> alone which you believe in:

The references are fairly obvious:

   * Lineo  http://www.lineo.com/ is a spin-off from Caldera that focuses on
     embedded Linux systems
   * QNX  http://www.qnx.com/ is a 20-year-old kinda-UNIX-like
     embedded/real-time OS company

> Given lock-in, the customer is going to want to be on the technology
> whose capability is going to grow faster.  So I need to know how the
> customers (a) _currently_ perceive the tradeoff, but also how they (b)
> view the future potential.  If Lineo is an open source firm that is
> going to be forced to price aggressively to differentiate themselves
> from copycats, customers may decide its preferable to be locked-in to
> the QNX technology with its access to a greater per-unit revenue
> stream and thus its ability to fund more development.  Especially if
> QNX's marketing talks the talk and walks the walk better than Lineo's
> does.

My perception is that Microsoft has taught a GREAT many companies to avoid
lock-in if at all possible.  As a result, being OSS-based is a significant
feature, and pushing proprietary/closed/single-source technology is an
up-hill battle.


> Note that being locked into the Lineo _brand_---by definition, if OSS,
> customers are not locked in to the brand---and being locked into the
> Lineo _technology_ are rather different things; the cost of switching
> to QNX in the future if Lineo, and its copycats, fizzle out
> technically is still substantial, I should imagine.  Certainly there
> will be many examples where it would be substantial.

The point being that even if Lineo, per se, fizzles out, then several of
Lineo's competitors in the Embedded Linux market will be there to pick up the
pieces.  Low barrier to entry makes OSS-based embedded Linux a challenging
business to enter, but it makes OSS-based embeded Linux solutions so
attractive to customers that I predict that at least one of the Embedded
Linux companies will crush the likes of QNX and VxWorks.  I just don't know
which one(s) will do the crushing, because there are about a dozen contenders
in the embedded Linux market at the moment.


> OSS-based business models have yet to demonstrate cost advantages in
> development (in the abstract sense of lower cost/performance, however
> customers define the latter) that are not (more or less) cancelled out
> by the competition adopters of that model must face from other firms
> who by definition have fairly equal access to their most valuable
> resource.

This analysis explains why it is not a significant advantage in terms of
profitability for RH vs. Microsoft for RH to be in the OSS business.  It
completely ignores the fact that OSS makes the product so much more
attractive that it may drive the entire proprietary OS sector into the
ground.  The low barrier to entry cancels RH's cost advantage due to OSS, but
it does not cancel the *customer's* advantage due to OSS.


>  I am fairly convinced that OSS does not impose a net
> business disadvantage in many fields of software development, and can
> see many small advantages that accrue in one segment or another.  But
> conversely I strongly doubt that it confers a _crushing_ advantage in
> any market segments.

Where as I think that the crushing is about two years away in some selected
markets; considerably longer in others.

Crispin
-----
Crispin Cowan, CTO, WireX Communications, Inc.    http://wirex.com
Free Hardened Linux Distribution:                 http://immunix.org
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