red hat - the open source model

Open Source The Business Model

(It's good for the community, supplier and customer!)

Red Hat

With a Lever Long Enough...

Large ocean liners, tankers, aircraft carriers, and other massive vessels have equally massive rudders. However, even the sturdiest rudder axle would snap under the pressures of battling the inertia and water pressure resisting its attempt to change the direction of one of these behemoths. That is why, on the trailing edge of these giant rudders, there is a thin strip of steel called a trim tab. A relatively small motor turns the trim tab, which can withstand the relatively small water pressure against it. That pressure is translated to the massive rudder, which responds by turning in the opposite direction, and redirecting the entire ship.-- David Galiel, A Lever Long Enough

n.b. The open source model enables millions of tiny levers, loosely connected, to change even the most intransigent companies, industries, and paradigms.

You can change an Industry.....

Red Hat is the worlds leading and most trusted provider of open source solutions.

We are experts in helping our enterprise customers derive value from the open source development model.

Our unique business model delivers open source technology and enterprise-class servicessold by subscription.

Our operating system platform, Red Hat Enterprise Linux, together with applications, management, and service-oriented architecture solutions, including the JBoss Enterprise Middleware Suite, deliver industry-leading value.

And with 66 offices in 30 countries, and the track record of the open source leader, we have the global capability and expertise to help you get the most out of open source in your organization.

The basics:

Founded1993IPO1999 Worldwide offices66 offices in 30 countriesEmployees~3,000HeadquartersRaleigh, NCPresident and CEOJim WhitehurstChairman of the BoardMatthew J. SzulikExec VP & CFOCharles E. PetersMarketNYSETicker symbolRHT

~15 Million users of Red Hat FedoraThe early release version of RHEL

~20 Million Downloads of JBOSSThe Community Version of JBOSS

~3 Million ServersRunning Supported Red Hat Linux

~2200 +ISV Partners

~3400+
Certified Red Hat Linux Applications

~7 Years Support per RHEL Version

As of February 2009, there are over 2,200 ISV Partners in the Software Catalog and over 3,400 certified Red Hat Enterprise Linux applications in the Software Catalog.**

Customers want the largest choice of applications possible and ISVs want to be certified on the most popular platforms combined, this creates success for the growth of Red Hats ecosystem.

Red Hat boasts the ability to enable our ISV partners to certify their software only once for a single architecture because the Red Hat Enterprise Linux product family shares a common core.

This works with Red Hats promise of certify once, deploy anywhere, making life more simple for our customers and partners.

The final part of our mission talks about the open source way.

What is the open source way?

It's how we develop our technology. And it has a wide range of characteristics and benefits.

There are many reasons why our open source model of development solves problems for our customers.

It's a better way to build technology. It provides a better environment for innovation and collaboration.

It also allows us to build more transparent relationships wit our customers. We can deliver more performance and value, and in turn Red Hat delivers more accountability.

It's our job at Red Hat to be a guide for enterprises in the open source community and help them take full advantage of these benefits.

To understand the fundamental differences in the Red Hat approach, you must first understand what makes our development model so fundamentally different.

Here's the idea:

More participation equals better technology for everyone.

By encouraging customers, contributors, and partners to become part of the innovation process, they become participants in their own success.

That doesn't mean every customer will want to contribute code, or even want to participate at all. And it may mean contributing ideas or feedback.

We want to help foster an open source environment where anyone can contribute and the best ideas win. In other words, we create value by sharingand allowing the ability to share.

The more we share, and the more we help others share, the more value we create for our customers.

Collaborative Innovation Framework

Anytime, Anywhere, Anyhow access to knowledgeOpen ContentAccess to Knowledge(Creative Commons, Wikipedia)Open StandardsEnabling access to data(ODF, Royalty Free Standards)Open StandardsEnabling access to data

Open ContentAccess to Knowledge(Creative Commons, Wikipedia)Open StandardsEnabling access to data(ODF, Royalty Free Standards)Open SourceFreedom to modify the code(Fedora, Software Patents Issue)

Some Open Source Facts

The Long Tail of Open Source

Source: http://opensource.mit.edu/papers/mockusapache.pdf OSS achieved first article sooner...

With fewer bugs...

That were fixed sooner...

The trend continues...

Xen Virtualization

SE Linux

GRASS/R/PostgreSQL

MySQL

JBoss ecosystem

Eclipse

Blender, Inkscape, GIMP, Ardour, Audacity, etc.

Open source is a proven, high quality development methodology

Customer Adoption:Open Source Changing

Early adopter represents a fractionof the total IT spendSupported Open Source:- Typical Sweet spot

Laggards-late to moveCost and risk sensitiveEarly Majority;Influenced by referencesWhole product neededVendor Confidence ParamountMain Street- Commoditised, Value Led, Dominated by 2-3 licence vendorsOpen Source=High value alternative

Supported Open Source:- Moving to Early Adopters(Virtualisation/Cloud)

Late majority:Conservative, Price drivenOpen Source is very attractiveSupport and reputation critical

Open Source for Commercial use?

Thomke, Stefan and Eric von Hippel (2002) Customers as Innovators: A New Way to Create Value Harvard Business Review, Vol 80 No. 4 April pp 74-81. Customer needLicensed SoftwareOpen Open Source

High Quality SoftwarePossiblyLikely

Stable and Robust for Enterprise usePossiblyV.Unlikely

Certified and Supported on Hardware SelectedV.Unlikely

Certified and Supported on SoftwareSelectedV.Unlikely

SLA for assistance and fixingYesNo

Revision management for 3-7 yearsYesNo

Low cost of acquisition/operationunlikelyYes

Availability of trained/training resourcesLikelyUnlikely

Consulting, Vendor and partner supportLikelyUnlikely

API stabilityPossiblyYes

Adherence to open standardsWhere necessaryLikely

Support audit trails for complianceV.LikelyV.Unlikely

Licence IPR coverYesNo

Potential for Lock inHighLow

No Licence CostCapital is not spent on product that could be acquired focPotential for customers saving millionsOpen Standards are the de-facto normInterfacing to other technology simplerPotential for lock in lowInnovation Levels HighCommunity development, motivated, clever peopleLess restrictions due to legacy protection issues.Developers Favour Open SourceAvailability of Source code unlike ProprietaryAbility to modify/re-develop to adapt to challenges

Open Source for Commercial use-Benefits





Lack of Stability and controlled longevity Needed to maintain Datacentre UptimeHardware Suppliers don't certify pure open sourceHardware SLA cannot be supported by Vendor Software Vendors only support managed releasesCommercial Software Suppliers do not support open Open Source versionsNo SLA from Suppliers to supportProduction Downtime costs moneyIP breach could be a risk for userlegal and purchasing departments may avoid open sourceSupport Workload-Open is UnsupportedYou are on your own....No Roadmap.... Open Source for Commercial use-Challenges





MAKING OPEN SOURCE ENTERPRISE CONSUMABLE

Development DirectionQuality Control
Release ManagementCertificationISV ProgrammesPhone SupportBug FixUpdatesProfessional Services

In todays presentation we will talk about some of the business drivers for migrating from SUN Solaris to a Red Hat Linux environment, Transition tools offered by HP to customers and briefly look at top 5 issues (in no particular order of priority) we have come across in transitioning customers to a RH Linux environment HP Platforms in the past.

Red Hat Contribution to Linux2-3000 developers/ membersFrom Red Hat in Linux community

Linux Contribution of Community Members

Red Hat Development Management

Beta Track

Final Track

R&D Spend FY2010:US$130M (+33%)

2 Year Major Release

7 Year Life Cycle

Managing The Enterprise Hardening Process

What's in a Subscription?

What do you get?

The subscription model is the best way for us to deliver the on-going value of Red Hat, and the continuous innovation of open source to our customers.

The subscription is at the heart of our customer-friendly business model.

Ultimately, the subscription model delivers peace of mind over the long-term.Predictable technology, predictable costs, predictable innovation, continuous value.

Primary features of a Red Hat subscription include:

- Access to the software product binaries and documentation (source code is available for free with or without a subscription)

- Regular product updates and version upgrades

- Maintenance (bug fixes, security fixes, new hardware support and features)

- Support (phone and/or web, up to 24x7 with - 1 hour response)

- Ability to deploy on fully supported hardware and software from a large portfolio of certified ISV applications and OEM hardware certifications

- Ability to work with Red Hat to influence future product directions

- Stable application interfaces (API/ABI) for multiple years (up to 7) so long-term, secure, deployments are feasible

A subscription is more than just the technology. More than just support. Only when these elements are combined do you have the full value of a Red Hat subscription.

The Scope and Options from OSS is growing

The Red Hat open source solution stack delivers a wide range of viable alternatives to proprietary technologies.

We deliver value through every application, every workload, and with every business requirement.

More and More Choice in the Open Source Market

Pure Open Source...Commercial

The Red Hat open source solution stack delivers a wide range of viable alternatives to proprietary technologies.

We deliver value through every application, every workload, and with every business requirement.

Enterprise Adoption of Supported OSS:
Key to OSS Industry Growth

Enterprise Use Creates Large ROI for Users

Major Potential Savings In Government IT

Enterprise Use Creates Industry Acceptance of OSS

Enterprise Use Funds Strategic Directions

Enterprise Use Forces and ReInforces Open Standards

Enterprises and Users Pay for Support if Needed

Smaller users gain from Enterprise Adoption

4-4.5M Paid Linux Subscriptions, 50M installs

It's a Win-Win-Win.....Enterprise Use Creates Large ROI for Users from Licence savingMajor Potential Savings In Government ITEnterprise Use Creates Industry Acceptance of OSSEnterprise Use Funds Strategic DirectionsEnterprise Use Forces and ReInforces Open StandardsEnterprises and Users Pay for Support if NeededFunding grows the Product Line and Code BaseSupported Open Source Becomes Commercially NormalSmaller users gain from Enterprise Adoption 4-4.5M Paid Linux Subscriptions, 50M installs

But what can Red Hat do for you? What can we do for you now, today?

Everyone knows the pressures of the current economic environment.

Depending on your point of view, the economic crisis is either a complete catastrophe or a potential opportunity.

You're going to be doing more with less. There's no getting around that.

Here's another truth: Getting through any catastrophe requires that we see the opportunities it presents and act on them.

If you are willing to embrace change, to look for better ways--then there is an upside to the downturn.

This is the time to take a leap. To differentiate yourself as an innovator.

Otherwise your job is just more hunkering down, budget cuts, staffing cuts, longer hours, and lowered expectations.

The old safe is no longer safe.

We can help you make the transition. We understand enterprises use a mix of open source and proprietary software. We make sure our technology is interoperable with a wide range of technologies.

The result is a customer model that's built on rapid innovation, designed for value, and centered around you.

red hat - the open source model

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