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InfoWorld: Red Hat: The Mother of All Business Models

Jan 16, 2006, 01:00 (4 Talkback[s])
(Other stories by Matt Asay)

[ Thanks to Matt Asay for this link. ]

"I'd like to focus on one, in particular, that I think is absolute genius: Red Hat's. Oddly enough, I can't think of a single other company that uses Red Hat's model, despite its evident success. I'm not sure why, except that I do think few understand the nuances of Red Hat's model. I'd therefore like to spend a few minutes trying to unpack exactly how Red Hat operates.

"Red Hat's model is a product of necessity. The company had to figure out how to survive its lack of code ownership, and found a brilliant way to turn this apparent deficiency into a strength. In turn, this has allowed Red Hat to invest in innovation that all benefit from, but which benefits Red Hat particularly. (As a related side note, without a good business model, open source and innovation are at odds--a good business model will allow a company to heavily innovate, secure that it will be able to profit from such innovations as much as and more than its competitors...)"

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