Comments on: Red Hat: The money's in JBoss, not the desktop

Linux specialist is starting to create friction, as well as money, with partners by moving up the software stack. Should it stop with mission-critical middleware?

[Vegaman_Dan]

Consulting and support have always been the big money makers in IT. Hardware and OS are just the loss-leaders to get people to install apps, break them, and then ask for help.

As long as you have end users, you will always have a high demand for support and consulting.

[pauljweighell]

"? Hardware and OS are just the loss-leaders to get people to install apps, break them, and then ask for help."

So the world's most successful computer company, Microsoft, makes less money from software than consulting and support? I don't think so Dan.

So software makers deliberately break applications so they can have the cost overhead of additional support staff? I don't think so Dan.

The only people who want to pull cash via consultancy and support are the open source community who have to make their profits from ongoing support as they cannot sell the software itself.

[The_Decider]

You can sell open source software. Many do.

[bmukund]

Dan and Paul are both correct, it is true that vendors like Microsoft and Oracle truly make money out of selling software and avoiding support and consulting as "organic" or "proportionate to people" business models that they shun.

However, it is also true that this business is dying quickly. The only people, at least in the direct enterprise sales model who can make money are those that can sustain quotas like Microsoft, Oracle and SAP do. Most other companies cannot and therefore going open source to reduce the cost of sales and marketing is the only option - and therefore making $$ out of consulting and support.

I guess Larry was right about consolidation of the software industry....

[jaymeyer]

The article is not about product vs. support biz models - instead its about desktop vs. server sales. RedHat has never seriously chased the desktop market, instead they chose to chase the server market. its a simple question of sales - IT operations folks spend big money on big servers and software from Sun, IBM, Oracle without batting an eye at a 6-digit check. Red Hat is selling to those people instead of the home users that spend $45 on a Windows XP Home upgrade.

So RedHat yields the desktop market to Ubuntu while they chase the big IT operations checkbooks. Its difficult to focus on both like Microsoft has done (but it took M$ a few decades to get established in servers), and so Red Hat focuses on the server market, and JBoss helps them sell even more products to their old customers they already know. I'm sure someday RedHat would love to own the desktop at big IT corps who buy thousands of laptops per year, but for now they are busy selling RHEL/JBoss.