BW on opensource in 2005

Business Week has great round up of their open source stories for 2005 along with predictions for '06.

Here's my favorite quote:

"It took them a long time to realize if you don't open-source and you're not a market leader, you're dead," says Peter Yared, CEO of open-source startup Active Grid and a former Sun executive.

I have one beef, which is a constant in financial reporting:

On Dec. 22 it announced stellar third-quarter earnings, with revenues up 43.6%, to $73.1 million, and profits up 114%, to 12 cents per share.

Why switch from total revenue to earnings per share? How do you find out the margins they are making? Up 114% from what? Per share? Did the numbers of share increase or decrease? Argh!

Category(s): Open Source

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Predictions for '06
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Banks thinking strategically about security

Re: BW on opensource in 2005

Posted by James at Dec 29, 2005 04:06 PM

Revenue is an inaccurate measurement for open source companies since it will be lower than closed source companies who sell their product. The margin and earnings are made on support which are higher.

Re: BW on opensource in 2005

Posted by nowen at Dec 29, 2005 06:09 PM

I wouldn't say inaccurate. Their margins should be higher, but revenue growth would be a valuable metric. Even open source companies may be unprofitable for a period of time during a high-growth phase. Revenue growth would show you when they should break-even.

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