Author: JT Smith
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Author: JT Smith
Author: JT Smith
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Author: JT Smith
Guest Editors: Eric von Hippel, Sloan School of Management, MIT and and Georg von Krogh , Institute of Management, University of St.Gallen. Submission deadline: December 31, 2001.
Both empirical and theoretical submissions are invited.
Examples of topics include:
We encourage authors rooted in disciplines including sociology, economics,
social psychology, as well as technology, innovation and strategic
management, to consider a submission of their OSS related work. We welcome
conceptual contributions, quantitative data analyses using a variety of
methodological designs (e.g. simulations, field studies, archival studies,
laboratory experiments), as well as case studies, participant-observations,
ethnographies, and other research strategies that help shed light on OSS
development.
Submission details
Authors should submit their papers to: Professor Georg von Krogh, Institute
of Management, University of St.Gallen, Dufourstrasse 48, CH-9000 St.Gallen,
Switzerland. E-mail: georg.vonkrogh@unisg.ch. Authors should prepare their
manuscripts according to Research Policy’s instructions to authors. Please
find these instructions at Research Policy’s homepage at
http://www.elsevier.nl/homepage/sae/econbase/respol/menu.sht. Every
submission will be reviewed according to the double-blind review process of
Research Policy.
A special issue conference will be held at MIT or in St.Gallen in September
2002. Updates and additional information on the special issue, suggested
topics and the special issue conference might be found at
http://opensource.mit.edu.
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Author: JT Smith
Today IBM is well on its way with those plans, yet says it still has some ground to cover.”
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Author: JT Smith
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Author: JT Smith
Author: JT Smith
Let me state up front that I carry no water for Red Hat, which I think has done some pretty silly things, or for VA Linux,
with whom I’ve had few contacts, or for any other Linux company, most of whom have yet to provide any rational
explanation of how they plan to make money on free software. Let me further note that the wider variety of plaintiff’s
lawyers would look mighty good to me covered with honey and staked over an ant hill.”
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Author: JT Smith
After a year of press releases and rather little else, Indrema was
earning little notice except for occasional scornful remarks from Slashdot
posters.
He had a shiny box, a
little bit of software code, and next to nothing in the way of
product, and he still had no funding. By last week, the Indrema CEO admitted to Red Herring that things were looking pretty grim. Gildred said, “We’ll know in the next 30 days” if the company would survive. They
knew sooner than that. A week later, they were out of business.
From the beginning, the idea was absolute madness. Developing an
electronics platform is extremely capital intensive. It’s one of the many reasons
that Sega is getting out of the business. Even Microsoft is finding the
costs of developing its X-Box console to be a real strain on the bottom line.
Further it’s a business that functions with tight margins. Gross
profits can run as low as 10%. The only way to survive in such a market is to
generate vast economies of scale, and to sell millions of units.
For another thing, the box, whether it is a computer or a hand-held
game machine has to have something to run to be viable. Indrema’s
developers apparently hoped that Open Source developers “who couldn’t afford to
make games for Nintendo or Sega” might be persuaded to build something for
them. But what kind of developer “couldn’t afford” to build to those
platforms? Today’s game software is incredibly expensive to make. The development
costs of leading titles frequently rival that of some lower-end movies.
A better question would be, what kind of developer would ever risk
hundreds of thousands (if not millions) of dollars on anything other than a
solid commercial platform? Sony, Sega and Nintendo, especially, broke into
the market with a set of programs, and heavily subsidized their early
developers. They had to. Without sufficient games, the average mass marketer
wouldn’t have considered them. Many retailers have sold game hardware as a loss
leader. The profit has been in the games themselves. No games, no
profit. no interest.
Even if games were available, profit margins on the retail side of
the consumer electronics space are razor thin — worse than they are for
hardware developers. That means that retailers can’t afford to take risks on any
product that might be left on the shelf. The winnowing process can be
pretty brutal, as Sega recently discovered. Whatever the merits of PlayStation
2, Nintendo’s GameCube, or the upcoming Microsoft X-Box, each of these
developers can promise retailers a hefty advertising budget. Further,
they can use their other product lines to cross promote, lessening the risk
that a retailer will get stuck with unwanted inventory.
Also, because companies like Sony and Nintendo already have a
substantial presence inside virtually every major electronics retailer, they have
plenty of influence. They can — and do — use their other products as leverage
to “stuff the channel,” effectively forcing retailers to take on a
new console if they want to sell other, more established products. The console companies
can even “persuade” retailers not to carry a given product (made by
their competition) or to stick it on a back shelf somewhere if the retailer
ever expects to get the latest video games or software. It’s blackmail, to
be sure, but it’s done all the time. Cut throat? You bet. This is a market
that Microsoft could lose because it’s too nice. Tactics that
got Microsoft its first court date with Judge Thomas Penfield Jackson are
just standard operating procedure in consumer electronics.
But that’s how the grownups in this business do marketing.
That blood-soaked retail environment is the one reason I continue to
have so many doubts about Linux-based handheld devices or Linux based
MP3 players, even now. Consumer electronics is a damn tough market to break
into, and it’s even tougher to survive. The quality of the product is
almost beside the point, compared to raw marketing muscle and a willingness to
use it.
It was that environment which made the Indrema fantasy just that,
from the very beginning. The most fortunate thing about this entire gambit
was that this particular show closed before other investors could be
found who might have been willing to throw even more money at a
hopeless project.
Ever the entrepreneur, Gildred promises he’ll be back. He recently
told Video Business, “I will develop a similar product and
re-invent it under another umbrella,” a pledge which probably did little for his
current investors. Gildred suggested that next time, he’d try “working
for a company, rather than creating it from the ground up.”
Unfortunately for Gildred, unless that company turns out to be someone like Sony or
Microsoft, he’s likely to have just as hard a time the second time around.
He might want to skip the encore performance.
NewsForge editors read and respond to comments posted on our discussion page.
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Author: JT Smith
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