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...Home ... Editorial ... Columns ..Column Story Friday: April 4, 2014


 Inside the Kernel  
Emmett Dulaney
Emmett Dulaney


 Should Red Hat Start Selling Oracle Support?
Emmett thinks there's a hole in the support-services market -- and only a third party can properly fill it.
by Emmett Dulaney  
4/15/2007 -- I was quite the photography buff a couple of decades ago. Of course, this was before digital photography; back then, you had to work to snap a good picture. I remember coming across a company which swore that you could get better images by using 35 mm movie film instead of standard camera film. It sent me a couple of rolls to try for free -- and try them, I did.

But when I took the film to be developed, I discovered that there was only one place in the world that would develop such film: the company that had sent me the free rolls. And you wouldn't believe what it charged for developing those images.

I bring up this story because one of the most popular software business models prevalent today involves selling maintenance -- or support -- services to companies that use a particular product. You can basically give your operating system or application software away for next to nothing, armed with the knowledge that companies will pay you an annual fee just to have someone respond when something goes awry.

This business model isn't unique to the software industry. Many manufacturers used to give away printers for next to nothing, knowing that customers would have to buy their proprietary inks at huge markups. What happened in that industry, though, is that third parties saw how lucrative the market was and started either making cartridges that would work in those machines or refilling the original cartridges, both at greatly reduced prices that ate away at the printer manufacturers' profits.

Given this, it should have come as no surprise when Oracle announced last fall that it would start providing support for Red Hat. In Oracle's opinion, Red Hat was making too much money from supporting its own product. Oracle decided to step in and offer a more cost-effective choice.

Many, however, saw this as crossing a sacred line. How dare Oracle offer the same enterprise support for the Red Hat kernel as it does for its own products? How dare it try to muscle in on someone else's revenue?

In the days since, more than a handful have suggested that Red Hat should play the same game. If Oracle is going to underprice Red Hat on the support of its own product, Red Hat should underprice Oracle on the support of Oracle's product. This train of logic, however, is foolhardy. Red Hat isn't in the same league as Oracle and needs to shore up its own business instead of going after others'. The situation that exists now is one that Red Hat has brought on itself -- and it won't go away by fighting a price battle on another front.

What's most surprising in all of this is that it took a giant company like Oracle to point out the pricing problems inherent in today's revenue model. The opportunity for another company to step into this market has been there for quite a while, yet a leader still hasn't emerged.

To use another analogy, when the muffler falls off of an Impala, you always have the option to take it to the Chevrolet dealer and have a new one put on -- but that would be the most expensive choice. Alternatively, you can take the vehicle to the local mechanic and get it repaired for less, or go to a chain such as Midas and have it repaired there.

The equivalent of neighborhood mechanics -- and, of course, the Chevrolet dealer -- exist in the IT support industry. What's missing is the Midas equivalent. You can argue that firms like Accenture are there, along with IBM and a few others, but none of them really fill the niche that Oracle was able take advantage of.

It's my contention that there's still a hole in the market that needs to be filled: a third-party company that can be a one-stop support vendor regardless of what you're using -- be it Oracle, Red Hat, Windows or anything else. Right now, it's still too easy for one vendor to blame your problems on another and create a support loop nightmare that you can't break out of. I salute Oracle for opening the door; now, let's hope others will enter.


Emmett Dulaney is the author of several books on Linux, Unix and certification. He can be reached at .

 


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