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The Business Case for Open Source Hardware

How open source hardware can be a vital part of a practical and effective business model
by Christopher Clark on 1 April 2014

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Transcript of The Business Case for Open Source Hardware

Case Study
Business Case
Open source by habit
Education by nature
Open source and Education
as a strategy
2003
2004
2005
2006
2007
2008
2009
2010
2011
$25M
$20M
$15M
$10M
$5M
150e
120e
90e
60e
30e
140
emps
102
emps
74
emps
51
emps
31
emps
21
emps
11
emps
2
emps
1
emp
$18.4M
revenue
$10.7M
revenue
$6.6M
revenue
$3.8M
revenue
$1.8M
revenue
$880K
revenue
$410K
revenue
$211K
revenue
Revenue at year end
Employee count at year end
$30M
180e
2012
145
emps
$25M
revenue
$28.3M
revenue
The
For
Open Source Hardware
Christopher Clark
@Frencil
Director of Information Technology
Open Source
Software
Business models and such
Open Source
Hardware
Business models and such
Why Open
Source Anything?

Transparency
Development
$
Software
Hardware
Free Redistribution
Technology Neutral
Not Restrictive of Other
Software (or Hardware)
Not Product Specific
Distribution of License
No Discrimination
Against
Fields of Endeavor
No Discrimination
Against
Persons or Groups
Derived Works
Attribution
Documentation
Scope
Necessary Software
Source Code
Integrity of Author's Source Code
vs
Dual
Licensing
Examples
MySQL, NetBeans, Asterisk
Open Core
Examples
Android, increasingly =(
Service +
Support
Examples
RedHat, Digium
(Not an exhaustive list)
(Hypothetically, as compared to software models)
May yet materialize
MAAS
Just a terrible idea
Physical
Computing

Circuit boards
with components
that do cool stuff
SparkFun's Business Model(s)
Make boards
Sell them

So, why open
source the goods?
It's
Complicated.
An educated customer
base is essential.
Open source makes it easier.
The
Big Time
Watch
Kit
Intro to soldering
Please
Hack.
LilyPad MP3 Board
Value proposition
Target markets
Revenue streams
Distribution channels
Value Proposition
I'll sell you a thing to address your need
Proprietary
Open Source
Supplier support
Target Markets
I'll sell to you because you're {$X}
Individuals
Distributors
Educators
Industry
Government
Licensing
is key!
Revenue Streams
"Money can be exchanged
for goods and services"
Distribution Channels
Ways to get stuff and junk
Brick & Mortar
E-Commerce
Network of Distributors
3D Printing
IT'S
REAL.

Leverage
Continuous Development
Everyone collaborates; Everyone wins.
Deep customer insight
Drive innovation
Lead and be led
Feedback
Loop
Robust tool chain
Various channels
Dog food
Versioning
Community management
Protection
Know your licenses!
Requiring attribution
Requiring improvements
Requiring royalty payments
Education
Broaden customer base
Long-term brand recognition
Drive ancillary innovation
Freedom Customer Base
~
~
Altruism is the best advertising
variety
complexity
Open Catalogs
The physical world can be open too!
Christopher Clark
@Frencil
Thank you.
Stuff in a
business model
Dual
Licensing
Service +
Support
(Manufacturing as a Service)
Open Core
Consistency
Open
Structures.net
?
Adapt the need
Community support
Adapt the product
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