Can Yahoo! do it?

Yahoo is struggling to keep up with the current Web trend. Carol may sound more optimistic in the above video, but the latest news suggests that Yahoo is planning to cut 5% of workforce. Nevertheless, she does has a point about the Microsoft-Yahoo search deal. The ten year deal allows Bing to power Yahoo search and allows Yahoo to keep 88% of the search ad revenue. Microsoft gets remaining revenue and gains access to the user info and preferences thereby helping in more targeted ads. This might add additional $500 million revenue for Yahoo.
But this still is not enough to stop the other businesses from faltering. Before the Y2K boom Yahoo was the trendy web and search company attracting most of web traffic. Its failure to innovate in search and missing the Social Networking wave has cost it dearly. I am afraid Yahoo shouldn't become the next Sun Microsystems or Novell.

Oracle and Open Source

Oracle's War on Open Source
Oracle has been in the news for the past few weeks not only because of its  stunning quarterly results but also its dealing with the opensource products it  bought along with Sun. Oracle claims it is world's largest OpenSource Company and does offer numerous Opensource products. Though Redhat rebuts the claim, based on number of products and sales, the claim is atleast in theory true. But again Redhat is right when it says, Open is not just seeing the code, but having a community of developers and not keep some part open and some part closed. Redhat goes further to say that Oracle doesn’t even qualify as an Open Source Company. Oracle's recent moves some how is substantiating Redhat's claim.
Opensolaris
initially MySQL was feared to be the FOSS product that  will receive Oracle’s axe or indifference. Though MySQL seems to be safe atleast for now, Opensolaris is not. It is official and has ended months of speculation   and uncertainty. Opensolaris is dead. Oracle has made it clear that Solaris  will be its mainstay product to get the latest feature updates. The Solaris source code  will be released to “partners” after the product release itself and the brand  Opensolaris will cease to exist.
Java and Google
Then Oracle sued Google claiming its Dalvik VM implementation in Android infringes several of Oracle's Java copyrights and IPR. In oracle's words, Google "knowingly,  directly and repeatedly infringed Oracle's Java-related intellectual  property." Now in this case it seems Oracle has chance of winning the suit or Google will take the route of out-of-court settlement. Either way Oracle is going to squeeze good amount of money from Google. This case has indeed rattled many other IT biggies who have invested in Java as their  choice of platform for their products. They are slowly falling in line with Oracle. Take the case of IBM, which Oracle says its enemy number one, shifted gears and decided to collaborate with Oracle on the OpenJDK project thereby abandoning the Apache Harmony project. Looks Redhat and Canonical are on their own to back Harmony now, may be they too will choose to fall in line with Oracle eventually.
OpenOffice.org
The other product that has been making news is OpenOffice.org or OOo, as the  Document Foundation has forked it into LibreOffice. Though Oracle has not done  anything from its side to result in this fork, the Foundation has decided that  this route is safe seeing the indifference from Oracle. I see the Document Foundation's point here but can LibreOffice survive on its own given the reach of OOo's brand name reach? Only time will tell.
Linux and Redhat
Finally Oracle stunned the world with its announcement in OpenWorld 2010. Going to extreme, Oracle has announced that it is forking the Linux kernel itself and has come up  with Unbreakable Linux kernel optimized for Oracle Database. This is perfectly  valid in Opensource world but it kind of hints what Oracle's intentions. It is clearly taking shots at Redhat. Its earlier attempt to undermine Redhat Linux with its offering of Oracle Unbreakable Linux never worked. Now Oracle will arm twist its customers saying the new Oracle kernel is better than one in Redhat's.
The above developments has sent shock waves across FOSS communities,  although not surprising, bringing in the question of what will happen to MySQL  eventually. It is very clear that Oracle wants to invest time and money only in  projects and products that will add value to both to its topline and bottomline. It wants to squeeze money out of all OpenSource products it owns, by all means. Though that’s understandable as a corporate responsible for provding value to its Shareholders, it should also should embrace the communities behind the projects rather than act as big brother dictating terms. But the question still remains, is this what always happen when a proprietary software company buys an  opensource company or product..? Especially when companies like Novell will be eventually up for sale and the industry heads towards consolidation. Not always true, but in most cases  unfortunately the answer is yes.

Private Equity Firm bids for Novell

Novell has announced that it is considering a bid by Private Equity Firm Elliot Associates to acquire it. At a price of $5.75 /share it will be an acquisition worth $1.8 billion. The price is almost 21.1% premium of what Novell's share was selling earlier. The news has sent Novell's share sky high in latest trading.
If this deal goes through Novell will become a private company.
Novell has been struggling to prop its legacy Netware based business with Suse Linux portfolio. Though it has not been completely successful in doing so, as evident from its falling sales quarter-on-quarter, the Linux division has shown some impressive growth. It has break even in the last quarter. But still Novell ranks a distant second in the Enterprise Linux market behind Redhat which sure is leader in that area.
Though the overall revenue of Novell might not be attractive, it still has a cash flow of around $981 million in its hands which might have attracted Elliot Associates. Can the equity firm turnaround the struggling company after takeover without burning the cash? The possibilities look  grim. But if Elliot is able to spun off Novell's struggling divisions out and concentrate on it Suse Linux based offerings then it will still might squeeze out profits from Novell.
Elliot might not be alone in its bid soon. Most analysts expect Dell or Cisco or VMWare or even Microsoft (though highly unlikely) to offer competing bid to takeover Novell soon. That might make sense for those companies as they have enough cash and a Enterprise Linux product in their offering will sure add up to their top line.
For me the only concern is the takeover might have significant impact on the community based development of Suse Linux. If Novell is to go down, that will make Redhat a monopoly in Enterprise Linux arena which is not good for innovation. Also the efforts for interoperability between Windows and Linux done by Microsoft and Novell might also be jeopardy. That might affect the customers as well.

Open Source Business Model - Part I

Open Source Software is the most disruptive business model in tech industry in the last decade. Still there are lot of myths, confusion, skepticism around it among developers,enterprises, software companies, channel partners etc. That includes me too. This is true especially when we see an Open source company clocking double digit growth in recession (Redhat) whereas another behemoth opensource company fails(Sun).So in an attempt to better understand opensource I am planning a series of blogs profiling opensource business model, its strategies, weaknesses, commercial open source companies, community opensource projects in the coming days. This blog is part 1 of the series. Here I introduce what is publicly understood agreed definition of Closed Source and OpenSource business model

Any computer software that is available with its source code in public is termed Open Source software. Where as proprietary or closed source software doesnt come with its code and the developer/company who came up with the software usually retains the source code and doesnot share it with the public.

The closed source model has been greatly successful for decades and is still the by and large the main business model in software industry. The general practice is, any company which creates the software, charges a premium for buying/using it. This doesnot include support,training, upgrades. It might charge for the additional services but the software as such comes with a price tag and without source code. Any patch or bug fixes will be done by the company that created the software because the source code is not shared.

Whereas a typical Open Source company doesnt usually charge for the product and it gives it free. So what is the revenue source for the company...? It charges for the documentation, bug fixes, and other attached services like system integration.

In the upcoming blog posts I will further deep dive into the OpenSource Business model which covers the licenses, community based development, revenue stream, Opensource Enterprises, etc.

My Write-Up published in Rediff.com

Rediff.com recently published my write-up about iPad. It is available here. I am also pasting it below...

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Apple's other iProducts are usually an improvement over existing products in that category and usually revolutionises the way people use them. A good example is the iPod which was not a brand new product in that category but it changed how people use it as part of their lifestyle. iPhone too is a good example.
But iPad's story is different. Though there are tablets/ handhelds/ pdas/ gaming consoles/ MIDs/ ebook readers already available, this machine doesn't fit any of the categories. It is a new product and is trying to create a new category of its own with all the above usages in mind. The usability and satisfaction should be seen in that context. In this regard, Apple's bold decision to introduce a new product is welcome.

It is a fine product just as any other Apple product. But there some quirks that needs to be mentioned.

One good example is how to hold this device? Whatever is the target purpose of this new device, either gaming or ebook or business device, the lack of a good holder/ handle to hold the device is a big disappointment. With a device of this size and with the glossy finish, I would have expected a way to hold the device safely, especially when the target audience of this device is frequent travelers.

Lack of camera, less pre-installed apps, flash are few other concerns.

Other major concern is Apple's proprietary attitude. The processor is Apple's own, OS is iPhone OS, app store is again totally Apple governed and the list goes on. If Apple expects it to be adopted widely, it sure might want to think about opening up some of these areas should not be hurting.

Otherwise this product looks awesome and might be a hit in India [ Images ] too. But wait, what I am saying? Apple had its flop products too.

-- Balaje Sankar, 28, Minneapolis, US


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How to Start a limited liability Company in India..??

Here is a nice blog entry which details how to establish a Limited Liability company in India. Click on the link below.

LLP in India

bJargons - I Marginal Revenue

It is the revenue per additional unit of an item sold. For eg lets say the price of an item A is 10$. And a company C sells 100 units on an average. So the revenue is 1000$. To sell an additional unit the company might have to reduce the price of the item. Why..? Since the item is priced at 10$, consumers are buying the product and the consumption is 100 units. To make the consumers to buy one more unit, the company needs to reduce the price for eg by .05 dollar. So the the price is 9.95$ now. Now the

Marginal revenue = Change in revenue/Change in units
which is
(101 * 9.95) - (100 * 10) / 101-100 = 4.95.

So the Marginal revenue is 4.95 against 9.95 that you might have expected.