New Business Models: Red Sox and Open Source

6 04 2008

How do you expand your business beyond existing customers and traditional revenue opportunities? Take the Red Sox for example. Fenway Park seats just under 40,000 fans and the Red Sox have sold out every home game since May 2003. But with the highest ticket prices in the majors, there’s just no room for price uplift to help revenue. So the Sox launched a number of businesses that leverage their baseball success into other areas: services like FanFoto, added value product like post-game concerts that in turn sell more food and merchandise, consulting to businesses that want to market through sports, online ads, and travel packages with the team to away-game destinations.

All around us new business models are maximizing economic value. I often get asked why we open source our software at Sun, and how we can possibly make money doing that. Well, developers that use our software platforms (e.g.; OpenSolaris, Java, NetBeans, MySQL) can innovate in their applications without worrying about the scalability, reliability, and flexibility of the underlying platform. And open sourcing those platforms expands our reach to developers who don’t have the funds to pay steep software licenses.

The number of people using our software increases each and every day. But we all learned at a young age that zero times a large number is still zero, so how do we make money when we give away our core software intellectual property?

Our business model today delivers support and managed services, added value products, servers, storage and consulting to empower open source deployers as they grow their businesses at Web scale. Value-added businesses that surround and enhance the open source experience. Ya know, not all that different from what the Red Sox are doing with their Fenway Sports Group business.




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