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The Media

On the Future of Linux Weekly News 133

Posted by michael from the community-chest dept.
Trevelyan writes "This article on LWN shows they are not alone, it seems that since they announced they will finish 1 August, loads of people have been emailing their support, and donating money, $12,000 as of this writing."
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On the Future of Linux Weekly News More

On the Future of Linux Weekly News

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  • Donations are nice, but... (Score:4, Insightful)

    by WanderingGhost ( 535445 ) on Sunday July 28, 2002 @08:46AM (#3967229)
    It's nice to see that they're getting so much support. It usualy isn't clear to people reading the news (or using some other online service) how much work is needed to actually keep the whole thing working.

    Now, althought I think donations are a nice thing, I wonder if they'll be able to solve the long-term problem: they need a steady stream of money getting in, and donations are not exactly the Right Way to achieve that. I wish them good luck (really). They have offered us a great site.

    • I don't know. NPR gets a significant portion of their operating budget through listener memberships. Perhaps that model could work for a web site as well.
    • The big question is how much is needed to run the place

      12,000 is nice, but I am sure that 120,000 would be far more useful, and 1.2 million or even 12 million would be needed to ensure a long term future.

      Not exactly at the right order of magnitude.

      It would be interestin toi know what the exact financilas are, but this is likely confidential information.

    • The only problem i see is timing... There is a time for grow, a time for setup and a time for resize...

      It is always time for setup... as business must be as usual and thrus new companies/businesses/projects must start at any time...

      As for grow/shrink, the problem is correlate all the economic environment and determine the correct time for each.

      To a project as LWN it seams that it is essencially a time to rethink the whole project and make a huge downsize in it's costs.

      What i would like to see was the company/project make the downsize without needing to grow the unemployment row by cutting jobs without making alternatives.

      IT IS THE MORAL OBLIGATION OF COMPANIES TO PROPOSE SOLUTIONS FOR THE POTENCIAL EX-EMPLOYEDS... But allas we live in a imoral time...

      Cheers...

  • Understand the Kuro5hin Story (Score:5, Interesting)

    by webword ( 82711 ) on Sunday July 28, 2002 @08:51AM (#3967237) Homepage
    Maybe they should read the Kuro5hin stories on this subject?

    1. The fundraiser ends, and the next stage begins [kuro5hin.org] (Support Kuro5hin, Kuro5hin.org)
    posted by rusty on 06/21/2002 11:23:29 AM EST
    123 comments

    2. Day two wrapup, and a change of plans [kuro5hin.org] (Support Kuro5hin, Kuro5hin.org)
    posted by rusty on 06/20/2002 08:21:06 AM EST
    84 comments

    3. Day one wrapup, and a special day two gift [kuro5hin.org] (Support Kuro5hin, Kuro5hin.org)
    posted by rusty on 06/19/2002 10:20:36 AM EST
    186 comments

    4. The Future of K5, and the First Ever Kuro5hin Fundraising Drive [kuro5hin.org] (Support Kuro5hin, Focus On...)
    posted by rusty on 06/18/2002 07:26:16 AM EST
    358 comments

    5. We're Broke: The Economics of a Web Community [kuro5hin.org] (Meta, Kuro5hin.org)
    posted by rusty on 06/17/2002 04:18:46 AM EST
    737 comments
    • Mandrake Forum [mandrakeforum.com] also has an article with nice suggestions for lwn.net.
    • Maybe it's the other way around...

      Per Rusty, K5's budget comes to $70,000 per year, salary and expenses, with himself as the only paid K5 employee.

      Yet LWN's article states that they claim they can get by on $15,000 per month for all five of them, or $36,000 per year each. Maybe the staff of LWN can teach Rusty a thing or two about living frugally...

      • Thats an incredibly fucked up thing you just said. I mean is it absolutely MANDATED that ANYONE who has ANYTHING to do with the open source community must make do with meager wages? WTF is wrong with Rusty making $70k a year? You even said yourself that it includes expenses so you KNOW he's not taking home the entire $70k.

        Maybe he might want to save for his retirement? Maybe he's married or thinking of getting married? Maybe he might want to save up for his kids or future kids college education? WTF are you gonna do that on $36k a year? Maybe he wants more at the end of his life then just grattitude from a "community" that has little to no grasp on issues beyond the keyboard, such as finances? Living frugally. Fuck. You should be lucky Rusty wants to do what he does period. Especially with jerks like you in the audience.

        If the LWN staff is fine living with $36k per year, more power to them. I just hope they run into more appreciative readers than Rusty obviously has. Shit if the man wants to drive a Porche and live in a Manhattan condo and K5 makes that possible for him then MORE POWER TO HIM! Fuck the open source, free EVERYTHING losers who want enterprising individuals or groups of people to live in near poverty as long as they are faithful to the "cause". Run a website that contributes to the community? Great! You just better not ever try to make a lot of money or the community will turn on you like a rabid pack of dogs for the sacrilege and blasphemy of doing well!!!!!
      • Per Rusty, K5's budget comes to $70,000 per year, salary and expenses, with himself as the only paid K5 employee.

        Yet LWN's article states that they claim they can get by on $15,000 per month for all five of them, or $36,000 per year each. Maybe the staff of LWN can teach Rusty a thing or two about living frugally...

        $15,000 x 12 = $360,000. Not $36,000. The problem for LWN (as they state in the article) is that the Weekly version is a lot of work. The daily updates could be handled by one person.

  • I'm going to donate right now... (Score:3, Interesting)

    by joestar ( 225875 ) on Sunday July 28, 2002 @08:52AM (#3967239) Homepage
    I'm back from 10 days holidays, and I'm very sad to learn that Linux Weekly News is going to end. It's really one of the best Linux news site, and deserves to stay alive until they can find a real business model so they can pay all the contributors. Why wouldn't they provide paying archives or provide extra services (instant Linux news or rumours, Linux people connecting (for business for instance)...). It seems Mandrake found its way to profitability, so I'm sure Linux Weekly News can also do it!

    The Linux community *needs* LWN, so please stay alive!
    I'm going to provide them right now my $5 paypal & a wire transfert of 50 Eur.

    • Re:I'm going to donate right now... (Score:4, Insightful)

      by Dthoma ( 593797 ) on Sunday July 28, 2002 @09:30AM (#3967298) Journal
      I don't think your donations will make a good deal of difference. If they're not making money in the long run, then no matter how much you donate they're eventually going to end up in the red again.
      • I'm going to donate every month.
        • Uhh just so you know, that's called a subscription. Which incidentally is something that actually COULD help them. If it was an option and they offered that. Oh but that might raise some criticism from the community, so forget that, let's just come up with some ideas like everyone gives them a dollar, that'll totally happen! Cause everyone would much rather just donate than receive something in return for their money, that's why profitable companies like Coke and McDonalds work on the donation model too!
          • Subscription would be nice, without paper/distro cost.

            "Community"? You mean the community bought Quake III Win32 version (which was cheaper) and begged us, Linux owners for its Linux exe?

            Ah, sorry... FUCK THEM...
    • deserves to stay alive until they can find a real business model so they can pay all the contributors

      I propose that they use the $12,000 to throw themselves a really killer going out of business party. At least they can show all of their contributors a good time, rather than toil with a poverty stricken news site for another few weeks.

      Because we all know that Linux is the party OS...
  • Guys... This was posted on LWN 2 days ago. Anyone who has not read it already is probably not an LWN reader anyway and so probably not interested. Why report this now?

    On a brighter note... If you like LWN then give them some of your hard earned money to help them continue their excellent service to the community!

    Thanks.

  • When I saw the original story (LWN.net Closing Down), and read "next weeks issue will be the last" I knew it was just a threat to try to raise money. If you really need to shut down, just shut down.

    All this donating to for-profit corporations sickens me. If you want donations from me, you need to be at least a nonprofit, and preferably a 501(c)(3).

    If you can't afford to run your website, allow mirrors to do it for you.

    • Their hosting is donated already.

      The great thing about LWN is that they actually write and analyse the news in addition to providing links to other sites. If you read the article they cover this and lay out their monthly budget (a minimum of $12K).
      • You are deluding yourself if you think someone needs "a minimum of $12K" a month to "write and analyse the news in addition to providing links to other sites". These people are conmen, nothing more. If you have some spare cash, pass it on to the great guys at XFree86 [xfree86.com]. The whole Linux desktop is based on their code, and yet it's really faded from the public eye in recent years, as people have instead concentrated on KDE and GNOME.

        If people can spend hours a day for months on end, I'm sure there's someone out there who will be able to offer an LWN because they _love the software_, not because they want to make a bundle off the shoulders of helpful Linux users. Donating big money to a for-profit company which writes news is not the way to go!

        • Re:Heh, I knew it... (Score:4, Insightful)

          by SomeOtherGuy ( 179082 ) on Sunday July 28, 2002 @10:38AM (#3967410) Journal
          Hate to say it but this guy has a great point. For less than $12K a month I could analyze, comment and link my ass off. (And go home in my Porshe each night.)

          Scenerio:
          My kids really suck up much of my free time, and my job is about 45-50 hours a week -- still I could most likely eek out about 10-15 hours of "hobby time" each week....My "mad money" could support about 400 gigs [rackshack.net] a month bandwidth I think....If I were to get together with 3 or 4 people in my same situation -- we could easily run a site like LWN....Or play in a garage band...Or make quilts....Or run a soup kitchen....Hell -- why is it nowdays that everyone running a website thinks they have to make a living from it. Does not anybody make a hobby from this type of thing anymore? Some of my fondest memories of the past came from running my BBS for 10 years. I could buy a whole bucket full of bandwidth for the cost of 5 phone lines.
          • hardware costs?
            bandwidth costs?
            maintenance costs?

            ok, so that probably wouldn't suck up 12k/month, but the fact that they can stand up up to a slashdotting probably says a thing or two about their hardware & bandwidth

          • You DO know that that $12k per month is divided at least 5 ways right?
            • Yes. The story says it takes about $15K a month for a staff of 5. All I am saying is that if a good percentage of GNU/Linux from a software perspective has been developed in a hobbiest/For the fun of it world....Yet, it seems that every site that puts together commentary or reviews of all of this software thinks they need a budget much bigger than even that of a brick and morter small to mid town local newspaper.
              • Maybe the folks who write about the software just have higher financial expectations than those who simply write the software? I mean the coders seem to be the ones all caught up in the "movement" so they're much more likely to be satisifed with making less money. I know plenty who would be satisifed if all they could spend all their time working on free software even if it meant they had to live in a tiny apartment and live off of pizza. That doesn't mean everyone else has to be satisified with that kind of lifestyle does it?
          • why is it nowdays that everyone running a website thinks they have to make a living from it.

            Time is money.
            • Time is money

              That's what I told the guy taking money at the golf course....Could you believe they wanted me to pay them money -- and I am the one that had to take 3 hours out of my busy day to walk all around and pick up all those divets...I expected to be compensated.

              In other words: That is why you go to work from 8-5....make the money. Spend the rest of the time giving back said money on hobbies, food and sex. It's a great system
              • That is why you go to work from 8-5....make the money.

                And then do another shift at home for free...

                Sounds like people just don't believe that developing and maintaining a web site should be worth something, no matter how much time or effort is put into it.

                "Something for nothing" is the applicable phrase.

        • Re:Heh, I knew it... (Score:5, Insightful)

          by steveha ( 103154 ) on Sunday July 28, 2002 @12:29PM (#3967700) Homepage
          These people are conmen, nothing more.

          Let's see: LWN has been published for 4.5 years, with insightful commentary that has won them many fans. Then they, without asking for money, announced they were going to shut down.

          Yeah, that sounds like pretty standard con-men tactics to me. Set up the suckers for 4.5 years or so, and then trick them into sending donations.

          If you have some spare cash, pass it on to the great guys at XFree86

          There are lots of great places to donate, but I don't need you to tell me which ones are worth the money. I personally find LWN to be more worth reading than PC Week or other paper magazines; if they offered a for-pay subscription, I'd go for it.

          steveha
        • You DO know that that $12k per month is divided at least 5 ways right? As in there's more than one person who works on the site....
        • The job LWN does is quite excellent--and this sort of excellence requires real effort. You don't get that kind of quality and coverage from dilettante's who spend an hour here or there. $12k/month barely pays two IT salaries, once you count insurance, social security contribution, workers comp, and similar expenses. I own a business, I know this.

          Moreover, I am also a professional writer, so I probably have a lot better idea than AirLace about just how much work goes into LWN's summaries. I don't write quite the same thing--but there is some similarity (my name is Mertz, btw, you can find what I do at IBM dW, Intel IDS, and elsewhere). I often write about a certain library or software product, and it really is a good week of work to become familiar enough with something to write a helpful 2500 words on the topic. Doing 52 such research projects a year is about what I could handle (and I'm a bright person).

          What LWN does is in some respects similar. True, they only write a couple sentences about each given product... but those couple sentences are consistently accurate, clear, and informative. Each one of those sentences represents probably an hour of work. LWN covers dozens or hundreds of topics each week! Each one of them requires just this kind of research... and, well, that's a few full time workers.
      • Is what they provide worth $12K/month? If it is, they should go subscription only, and the money problems would go away. If not, it should die, and these people should spend their time doing something more useful.
    • All this donating to for-profit corporations sickens me. If you want donations from me, you need to be at least a nonprofit, and preferably a 501(c)(3).

      I agree on the general statement, but

      • call a business of 6-7 people a corporation is a bit eccessive. I'd say rathery they are like a dad-and-mom shop.
      • You should not pay out of general good will. But if you in the past used their site and rekon that they delivered you a good service - as I do - you may well pay what you think their service was worth - as I did.

      • call a business of 6-7 people a corporation is a bit eccessive. I'd say rathery they are like a dad-and-mom shop.

        They're the ones who choose to use that entity. If they want protection from personal liability then they lose personal sympathy from me. You can't have it both ways. Either you are a partnership, or you're a corporation.

        You should not pay out of general good will. But if you in the past used their site and rekon that they delivered you a good service - as I do - you may well pay what you think their service was worth - as I did.

        That's paying out of good will. The bottom line is you will receive the same benefits regardless of whether or not you pay. If the mandate of the corporation is to maximize profits, then my mandate with dealing with corporation is to minimize their profits. I'm sorry, if you want to do good for society, it's really simple to form a nonprofit instead of a for-profit corporation. Instead of making your mission statement on your application something to the effect of "to make as much money as we can while still following the law," you actually write down what your mission is, and then you follow it. Yes, 501(c)(3) is much harder, which is why I will consider donating to a nonprofit which isn't a 501(c)(3).

        • Instead of making your mission statement on your application something to the effect of "to make as much money as we can while still following the law," you actually write down what your mission is.

          There is middle ground between a corporation and a no-profit.

          I believe LWN mandate is just "do someting useful for people (possibly enjoying doing it) and make a decent living out of it". Which translates in "get a job", and is actually my mandate, also.

          But since I didn't look at LWN constitution act (if they have one), you may be right in LWN being a coroporation.

          • I believe LWN mandate is just "do someting useful for people (possibly enjoying doing it) and make a decent living out of it". Which translates in "get a job", and is actually my mandate, also.

            If that's the case then they should be a charity. People who work for charities get paid, you know?

            But since I didn't look at LWN constitution act (if they have one), you may be right in LWN being a coroporation.

            They are most definately a corporation. "Copyright (©) 2002, Eklektix, Inc." I don't blame them for that. There's nothing wrong with starting a corporation. But if I have a choice to donate my money to a corporation which exists to make a profit and a charity which exists to help society, I'm going to choose the charity. And that's the way it is. Every dollar I give to them is a dollar I can't give to someone else.

            • If that's the case then they should be a charity. People who work for charities get paid, you know?

              So, in our view all artisans (tubists, mechanicians, carpenters), free-lance professionals (engineers, writers), small shop owners etc should either behave as corporations (i.e. maximise profits, not caring for customers) or become a charity ? Because they do something useful (in theory) and make a living out of it.

              Maybe you're right. But in my view of the world (a little idealistic, maybe) there are also people which just want what to get from their work a decent living, and don't care about getting rich.

              • So, in our view all artisans (tubists, mechanicians, carpenters), free-lance professionals (engineers, writers), small shop owners etc should either behave as corporations (i.e. maximise profits, not caring for customers) or become a charity?

                Not only should they, they are required to by law. But there are two other possibilities: become a nonprofit, or become a sole proprietorship.

                Maybe you're right. But in my view of the world (a little idealistic, maybe) there are also people which just want what to get from their work a decent living, and don't care about getting rich.

                Sure, they're called employees.

      • i worked for a company of 4 people and we were a registered corporation... We all played our parts...
  • I doubt $12,000 is enough, but if we all chipped in a dollar, LWN would theoratically have $600,000. That should be enough. However, some of us don't like Linux. So, the chances of this are nil.

  • Wiring $1 PayPal... (Score:4, Funny)

    by joestar ( 225875 ) on Sunday July 28, 2002 @09:38AM (#3967306) Homepage
    It seems PayPal offer $1 to every new account. If all Linux users open a PayPal account and wire the $1 to LWN, they will get millions dollars. I just wired my free $1!
    • Since Paypal takes $.30 per transaction, plus a percentage from each donation, you should probably consider sending $1.35 instead.
      • I don't think so:

        --

        Recent Activity | All Activity
        File Type To/From Name/Email Amount($) Date Status Action
        Payment To Eklektix Inc -1.00 Jul 28, 2002 Completed

        Balance: $0.00

        --

        And I don't see anywhere during the payment process that I would be charged $.30 later...
        • That's right. You aren't charged $.30 at all... but LWN would only get $.70.

          Paypal takes away the three percent from the person/business that receives the payment.
          • Ouch, math skills bad... three percent would mean they would get $.97... but they also take another cut on small transactions, to ensure that they make money on every deal.
            • Thank you, it's interesting, but I'm still doubting because I didn't see that anywhere in the payment process. Furthermore when I'm asked how much money I want to pay to Mr. X, I don't imagine anytime Mr. X won't get all the money I want to pay him. If you are right, I think I will consider contacting PayPal to suggest them to be more transparent about the real payment amounts.

              • the paypal fees info is on their site [paypal.com]

                the basic fee for paypal is 2.9% + $0.30, so if you pay $1, they will get $0.67. if you're not in the same country as them, it'll cost another cent in the dollar. (on the other hand, "merchants" receiving at least $1000/month with paypal get a somewhat better rate)

                in case you're not aware, this happens with credit cards too. the way the card companies make their money is by taking a cut of all the transactions. most places don't publicise the fact, but some places do pass the charges on by charging extra for credit card payments

        • No you don't see it, but as a Paypal tip jar owner, believe me they took it out.
  • Free Software is all good and dandy. But as is noticed by MANY Open Source Software, there are in fact mortgages to pay, taxes to pay, etc.

    And what I see is that Open Source and etc individuals are cheap skates. Ok I donate 10 dollars, but is that really what our work is worth?

    I think we need to get it through our heads that yes LINUX and Open Source did change the game. But the game is not free, just lower costs. So instead of paying 800 USD for a development environment, we need to start coughing up 99 USD for a development environment.

    Imagine how much further Open Source would be IF everybody who uses Open Source were to donate 1000 USD per year. Why 1000 USD? MS developers typically pay about 3K for their MSDN, plus other extras. I just decided to put something that I think anybody who makes a living from software could afford, EVEN when unemployed.

    When you do that type of math then Open Source does make economic sense...
    • The "free" (open source) problem is simple... Currently, most of the people wouldn't consider installing Linux (giving Redhat example,most popular) if it was same price as windows.

      Understand? They go with it because its free,cheap (costless to obtain), NOT because its superior than Microsoft software.

      Oh when you try to sell your hard work to those people like Linux journal, you get flamed.

      The worst enemy of linux is its user profile for now. Same ones who will mod -1000 down this post :)
    • Going from "LWN is folding," to "open source is failing," is quite a stretch.

      If kernel.org or even debian.org were about to fold, then you might have a point. But neither is in any danger of disappearing. LWN, while it's a wonderful site, is just a free news site. Plenty of non-linux/open-source news sites are in trouble or dead (including many that I worked with fairly recently). And so this merely goes to show that web-only news sites are probably not a reliable way to make money at this point in time. While I'm saddened to see LWN go, I still have my Debian [debian.org] system, and I still have my subscription to Linux Journal [linuxjournal.com]. I've had 'em for years, and expect to have 'em for years to come.

      IBM, HP, even Sun, and thousands of smaller (and/or less computer-oriented) organizations all have a vested interest in keeping kernel.org up and running. HP and hundreds of other companies have a vested interest in keeping debian.org up. Those sites are in absolutely no danger.

      Don't underestimate the power of cooperation as a competitive force.
      • I do not think in my post I said that Open Source was failing. I said that Open Source is having some problems. And LWN is just one of the latest. My point is that I have absolutely nothing against Open Source and I am user of it. But having come from the Microsoft World I have to say that while it costs, it also makes money.

        Co-operation is nice, but money is nicer. And lets be very real. Today IBM supports LINUX, tomorrow who knows. Redhat on the other hand is and will be a LINUX and Open Source supporter.
  • Now, who was it again that said Linux users are cheap elitists?
  • If their business plan doesnt work, like hell I'm going to support a BROKEN BUSINESS PLAN. ANyways, all that announcement was to do was leach from the community.

    If I remember correctly, good articles come from sites like kuro5hin.org (most CERTAINLY NOT this site) yet the authors don't get paid. Perhaps if LWN changed to a non-for-profit model, it would live. Never the less, I dont care.
    • Modern Definition of a Broken Business Plan:

      Our market insists that we should be able to run our business with no income whatsoever. Therefore, our market will not pay us any money under any circumstances. They will not buy our product, no matter how reasonably priced. They will not donate. They will not buy merchandise. They will not buy services.

  • Re: what about slashdot? (Score:5, Interesting)

    by larry bagina ( 561269 ) on Sunday July 28, 2002 @10:01AM (#3967340) Journal
    Look, let's face the facts. VA Software owns /., and if you read their financial reports, the *only* revenue they recieve is from sourceforge sales and thinkgeek sales. Around 90% of the ads they run on their own sites are for sourceforge or other OSDN sites. And they have "ad sharing agreements" in place, which means they trade ads and don't recieve money for some of the ads they show.

    If you examine the burn rate and remaining cahs on hand, it's clear that VA Linux will be bankrupt within a year.

    Slashdot is like a rich man's trophy wife - expensive to keep, but good for showing off to other people. VA Linux may try to get rid of this noose around their neck. Maybe by selling it, maybe by giving it back to Malda & co. But even then, can slashdot support itself? I doubt it. It's too big, too expensive to run and maintain. The slashdot community won't donate enough to cover costs. Especially when lameness filters and other policies alienate people towards other sites.

    A shame, really.

    • A question about stock. (Score:3, Interesting)

      by bogie ( 31020 )
      So did Taco et al actually get rich off the stock thing? I know unlike the general public they had to wait to sell the stock. On paper they were worth a boatload a while ago. So did they have to chance to sell before the stock tanked? If they did,they would certainly have plenty of cash to buy and run the site on their own. Just wondering.

    • Have you read the hidden comment about slashdot in the article?

      A "daily news ticker" pointing to external resources is relatively easy to do, especially if you have software that finds much of the stuff (and readers that send in the rest)

  • It's funny (Score:4, Insightful)

    by AirLace ( 86148 ) on Sunday July 28, 2002 @10:05AM (#3967347)
    These guys write about Linux and that's great and everthing, but do they really need to be a profit-making company to keep it up? And more to the point, does it make sense to donate money to a company? A friend of mine (who I'm not going to plug) set up a project to develop some low-level libraries for serial port communication, just to help other Linux projects (mainly to do with mobile phones / IrDA) and he's been hacking on it 2 hours a day for the last 6 months. Yet he reckons his job is thankless, and the only pro for him is to see his code used extensively by other projects. He would _love_ a small token of appreciation, even if it's just a postcard or a stuffed penguin or something, but he'd never go so far as to ask for it. It seems the only people who are ready to put aside their principles to ask for money are those who contribute less of the stuff that actually matters -- the code.

    Do we really want a community where the merchandise / documentation industries get all the cash and limelight? Ximian makes more money selling stuffed monkeys than it does selling support services or software and these authors are getting more money writing _about_ the code than the actual coders are ever actually likely to see for their efforts. Sometimes it makes me wonder if there's something to the Microsoft way of doing things -- write code during the day, get a paycheck at the end of the month, end of story.

    • Re:It's funny (Score:2, Interesting)

      by david_g ( 24196 )
      Your friend is willing to put 2 hrs of his day into writing that piece of code. More power to him. But what does he miss from those 2 hrs? Does he have a family? A girlfriend? (True) Friends? Does he like to do other things besides coding?

      And, he is doing it because he wants "to see his code used extensively by other projects". This is hardly selfless, don't you think?

      People at LWN have a life. They also like what they do, but they decided to choose what's truly important to them. In doing that, they said, "Sorry, we can't go on like this. We're going to stop." But the public said to them "Please don't." and they started providing for them to go on. It's good that they did. Maybe the coders should start asking for money, too. And, if they don't. Maybe they should choose what's really important to them.

  • Business 101 - Most Startups Fail (Score:5, Interesting)

    by N8F8 ( 4562 ) on Sunday July 28, 2002 @11:29AM (#3967498)
    I read a lot of complaining about the viability of the Open Source business model and how it may be failing in comparison to traditional companies.

    What makes you think Open source companies are any different? We should be shocked if any succeed given the number of market and institutional impediments they face.

    It took at least two hundred years for the existing business model to develop. Expect it to take more than a few years for a new model to take hold. The inroads Open Source has mode so far are nothing short of phenomenal.

    Even Microsoft is starting to see the writing on the wall. Software as a retail item is an all but dead model. that is why they are pushing for a service based model. That is why they see Open Source as such a threat. I've said it before and I'll say it again,"What happens when Open Source matches commercial quality and usability? What happens when software becomes a commodity?". My answer is that you have to sell the service. You will still need someone to install, maintain, customize and use the software. For most, the software is the tool. Like a hammer to build a house.

    • The success or failure of Linux has nothing to do with LWN.net. LWN may talk about Linux, but their business model is the old-school dot-com buster. i.e. give away content, hope to pay for it with non-existant ad revenue.

      Oh, as far as your other points...

      I've said it before and I'll say it again,"What happens when Open Source matches commercial quality and usability? What happens when software becomes a commodity?".

      What happens when it doesn't?

      That has to be answered, or at least a plan needs to be put in place on how you are going to get to this desired outcome.
      • When you view Open Source as a commercial venture vs. hobbyist Open Source you begin to see the difference. Each time a company wants to start a commercial venture they have at least one big advantage - they don't have to start from scratch. Ventures, successful or not, return at least two benefits back to the community - the development improvements and experience.

        Compared to closed or traditional ventures, the companies have to start from virtual scratch and when they fail most of their development and experience is either locked up in legal limbo or sold to another competitor for pennies on the dollar.

        Keep in mind that what you see in Open Source applications is about the level of quality you saw around the time when Windows 95 first entered the market. Big projects like KDE and OpenOffice are just getting to the stage of development where the features are there but the usability and stability issues haven't been ironed out. From here on out the real game begins. Open Source is just starting to be taken seriously. Heck, if you would have asked even a hardcore Open Source advocate a year ago if it were likely that Wal-Mart would ever sell Linux based computers in the retail market they would have scoffed.

        Sure, there are plenty of issues to be ironed out. But if every Open Source and Linux company dropped off the face of the earth tomorrow it would have negligible effect. The next wave of developers would pick up the pieces and move on. Can't say the same for Microsoft or Lotus. Their products would die and users would be left high and dry.
  • I wonder if this is going to be the beginning of a new business model: threatening to go out of business and then watching the donations rolling in. It sort of reminds me of these old bands/musicians that have a farewell tour every year.

  • Revenue Sources (Score:5, Interesting)

    by Restil ( 31903 ) on Sunday July 28, 2002 @02:10PM (#3968039) Homepage
    LWN's problem, as the market stands today, is that a website by itself is unable to bring in sufficient revenue to support full time employees, let alone multiple full time employees. Even considering the $12K in donations, that will not last more than a month, by their salary standards, and chances are good that will not be a repeating phenomenon as the slashdot link was probably responsible for a good part of it.

    Advertising as they've stated won't cover their expenses. And the level of advertising that will probably will be so annoying that it will drive off too many people. I've noticed this problem with my own site. Even a small banner ad would clutter up the page too much, and would probably bring me less than $100 a month anyway.

    Subscriptions are a possibility assuming anyone would pay them. $1 a month from every one of the lwn regulars would pay their requested salaries with NO problem. However, most people won't subscribe even if they feel the content is worth it. There is plenty of material out there for free. Being forced to support something doesn't usually win you many fans.

    You could always gather personal data and sell it to marketers, but that's just slimy and will piss people off more than subscriptions would.

    Then there are donations. While donations are great so long as they're completely unconditional, that's not always the case. I've got people that bitch because I don't have a domain. So every once in a while someone offers to send me $10 so I can get one. Problem is, I won't spend that $10 on a domain, I'll use it to pay my water bill, rent, or something else that's far more important to me than a domain is. That donator would feel shafted, and I would understand that. If his money was going to the site itself, the donation would be justified, but when it goes to pay for my own peronal expenses, it feels more like charity. Donations would certainly help, but the added burden of assumed obligation would create more problems than its worth. In LWN's case, its pretty clear that the donations are going to pay salaries and not much else. But from the tone of their most recent report on the issue, it would seem that some people might not have been aware of that fact.

    The only option that *I* have found that would be reasonable to me and my visitors would be merchandising. Either selling site specific novelty items, or selling useful equipment. Profits from these sales could then fund both the
    site and partially fund my salary, but with sales you open a new can of worms. You have customer relations, ordering, payments, warranty issues, shipment tracking, etc. Its a full time job just maintaining something like that on any significant scale. Which means that a substancial amount of the immediate profit gets churned back into the business of producing, packaging, and selling, which means, if I'm doing it, is a lot less time I'm spending on the site, which was the whole point of searching for extra revenue in the first place. Of course, to make it easy on myself, I could just take payments by check only and offer no warranty whatsoever on what I sell. A lot of people would turn away from this, but at least the cost of bringing in extra revenue would not exceed the revenue itself, and those that wish to "donate" at least get something tangible in return, regardless how I actually choose to spend the money.

    -Restil
    • However, most people won't subscribe even if they feel the content is worth it.

      Myth. Salon sold tens of thousands of subscriptions for something that was formerly free.

      There is plenty of material out there for free.

      There are a number of cliches that would apply here, but I'm sure everyone has heard them.
    • "$1 a month from every one of the lwn regulars would pay their requested salaries with NO problem. "

      Then why not? 12$ US a year + an option to buy a year of content on CD for 5$ US seems pretty good. You get to read all the time if you just want the news, and for reseachers you can buy all their back news for 5$/year. That's pretty cheap compared to some archival places. Maybe they have a special 16$ offer for regulars which gives them automatic CD support, 11 months, + 1 free bonus month.

      That's something even I, on minimum wage (currently 137$ US a week where I live) can afford.
  • Only 12K, that means a small fraction of this visitors that read the site are sending in money. ALso is LWN is it legal for LWN to take donations without being a not-for-profit? Does thi smean LWN has too treat the "donations," as investments?
    Personally, I think this is LWN's fault. Everyone on the web knows the times are changing, and that the advertising only business model doesn't work. Slashdot figured this out, why couldn't LWN?

    LWN's only chance is to try to roll out a premium service, and quickly.
    • ALso is LWN is it legal for LWN to take donations without being a not-for-profit?
      Of course it's legal!

      Donations to for-profit concerns aren't tax deductible for the donor, though.

      Does thi smean LWN has too treat the "donations," as investments?
      No. They have to treat the donations as business income. However, when they use it for paychecks for their employees, they get to write off the payroll as a business expense. So unless they get so much money donated that they show a profit (which seems unlikely), the business does NOT end up paying tax on it.

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