Originally Published: Monday, 29 May 2000 Author: Jeff Alami
Published to: columnists/Jeff Alami Page: 1/1 - [Printable]

The Free Software Entrepreneur's Guide: Part 2

As the revenues of companies involved in Free Software and Linux increase, Free Software entrepreneurship looks more and more like a winning proposition. In the first part of the Free Software Entrepreneur's Guide, we looked at three methods for making money with Free Software. Here are two more exciting ways to get your own Free Software company started.

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As the revenues of companies involved in Free Software and Linux increase, Free Software entrepreneurship looks more and more like a winning proposition. In the first part of the Free Software Entrepreneur's Guide, we looked at three methods for making money with Free Software. Here are two more exciting ways to get your own Free Software company started.

Hardware

In the computer business, selling hardware is considered to be one of the most difficult strategies, mainly because of the cut-throat competition and the dismal profit margins. The same is true for companies selling hardware with Free Software integrated -- in the Linux community, companies such as Atipa Linux Solutions, Penguin Computing, and VA Linux Systems specialize in this difficult business. If you're looking to sell your Free Software solution with hardware, you'll be up against not only these Linux upstarts, but also some of the biggest fishes in the sea, such as IBM, Dell, and Compaq.

An increasingly popular strategy for selling hardware is specializing in embedded systems. For example, network appliances for file and web serving, firewalls, and other networking purposes are especially popular. Cobalt Networks is the best example of such, using Free Software. One such upstart in this area is NetMaster, which sells Internet appliances with Free Software providing services such as E-mail, Web, VPN, DNS, and DHCP. If you can prove that you have the expertise to help your customers successfully deploy these systems, then you've won half the battle.

Why is Free Software so appealing for companies selling embedded hardware such as network appliances, set-top boxes, and PDAs? First, the price is right. Without license fees, the company's solved one financial problem. Second, and more importantly, is the flexibility. The company can now freely change any part of the software to better match their hardware.

Publishing

For almost as long as there were computers, there were computer magazines. For free operating systems, namely Linux, print magazines have been around since the Linux Journal printed its first issue in 1994. Now the Linux community has several magazine choices, including Linux Journal, Linux Magazine, Maximum Linux, and the Journal of Linux Technology.

Book publishers have scrambled to provide as many Linux and Free Software books as they can. The best of the bunch is arguably O'Reilly, with its famous "animal cover" books covering topics ranging from DNS and BIND to Perl programming. While it would be hard to beat O'Reilly at its own game, there's rooms for specialized books which would appeal to Free Software users. No Starch Press, a relatively small publisher, has done exactly that, with titles such as the Linux Problem Solver and Linux Music & Sound soon to be available.

Of course, let's not forget the all-too-common Free Software Web site. Plenty of online sites cater to Free Software users and developers, including Slashdot, MozillaZine, Linux Today, PerlMonth, and PHPBuilder. The same goes for online sites as for printed magazines and books -- find your niche and do it well.

Conclusion

The last time, we looked at support and consulting, retail packaging, and cooperatively-funded development. Now we looked at hardware and publishing. The question is, which strategy is the most viable? From the success of Linux companies, we can see that hardware sales, support, retail packaging, and publishing (in the case of printed magazines and books) are definitely money-making propositions. As for the online ventures, content and funded development bazaars alike, it's to be seen whether these can actually stand on their own or simply serve as loss leaders for other products and services provided by the company.

Looking at all these methods for making money, we come with but one conclusion: come up with something useful and original. If you have exceptional expertise in some useful piece of Free Software, or hardware design, or you're a great magazine editor with some ideas for providing information to Free Software users, then the rest will fall into place. In the next part of this Guide we're going to investigate ways to raise money for your Free Software firm.

Jeff Alami (jeff@linux.com) wouldn't mind trying his hand at founding a company related to Free Software and Linux, but he happens to be busy providing content for a site called Linux.com.





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