Diane Pursley November 20, 1996 15.939: Assignment 1

Microsoft is not the answer. Microsoft is the question. NO (or Linux) is the answer. (Taken from a .signature from someone from the UK, source unknown)

"I would rather spend 10 hours reading someone else's source code than 10 minutes listening to Musak waiting for technical support which isn't." (By Dr. Greg Wettstein, Roger Maris Cancer Center)

Overview

LINUX is a UNIX operating system clone which was developed by a loose worldwide consortium of individuals on Internet newsgroups. Their goal was to create the best and most useful UNIX system possible and then make that system publicly available under the GNU General Public License. All may freely copy, change and distribute LINUX, but one may not impose any restrictions on further distribution. Any distribution of LINUX must make the source code for the distribution available to the public.

The continued support of LINUX (through such projects as the LINUX documentation project) involves many individuals in various countries around the globe. (There are LINUX home pages in German, Estonian, Dutch, French, Czech, Portuguese, Spanish, Hungarian and Romanian—and more.) LINUX has been recognized by many people in the computer industry as one of the best UNIX products available. LINUX is competitive with UNIX products developed by a variety of commercial companies, and its use has grown quickly since its initial release in 1994. The exact number of users is difficult to define because it is publicly available free of charge.

Value Proposition

The value added by LINUX was the creation of one of the best and most useful UNIX systems. Then LINUX made that system free and publicly available under the GNU General Public License. The system promised to be the best because it was a collaboration of some of the most talented UNIX programmers from around the globe. These committed individuals contributed (and continue to contribute) to the effort with the belief that they were creating the best operating system in the world.

LINUX features include true multitasking, virtual memory, shared libraries, demand loading, shared copy-on-write executables, proper memory management and TCP/IP networking. It is designed to run on Intel 386, 486 and Pentium computers; ports for other chips are currently under development. The LINUX Documentation project lists a multitude of commercial products based on or related to LINUX.

LINUX development and debugging is very rapid (usually within hours of the discovery of bugs and security risks) through the efforts of the members of the consortium from around the world. LINUX is supported on the Internet by a myriad of programmers and system and network administrators. If one has a problem with LINUX, one can almost always find the answer in available network hierarchies. The LINUX community of user groups from around the would offer help and training to users and administrators of LINUX. It is a priceless support resource that has made LINUX an extremely versatile and vital operating system. Vendors cooperate to standardize the organization of LINUX directories and the placement of files in them, so users can combine or switch LINUX distributions without causing redundant duplicate files in different directories.

There is no doubt that there is tremendous value added by this organization. However, the members of the organization are providing the product for free. The operating system and excellent help resources are absolutely free. All updates or improvements to the system can be anything, but they have to be free. The freely-available LINUX documentation project is updated on at least a monthly basis.

Why does it work?

In order to dissect why this organization is working so well I used the sources of value, organization and competition bubble framework. The sources of value, explained above, is clear—arguably the best UNIX operating system has been developed. The organizational competencies developed to capture the value, or rather to share the value, has also been achieved. Anyone can access the resources on the Internet as well as use and add to this superior operating system created by some of the most talented programmers in the world.

The crux of the analysis is in the competition bubble—understanding industry structure—which can be better illuminated by the Five Forces framework. I define the industry as the market for operating systems.

I found that LINUX was unique because of the large base of extremely committed and brilliant people willing to do the work for free—utilizing the resources of their “day job” to the LINUX cause. These “committed” people are able to do this because of the nature of their work; most UNIX users are working in educational institutions such as MIT or in highly technical positions. Some are already writing the code for their research so they just direct it for public consumption on the Internet. Others develop LINUX code in the off-hours after their “real work” has been finished for the day. This group of people has found a way to “change the rules of the game” in the traditionally “for-profit” industry.

Competition and Rivalry

LINUX’s competition can be defined as all for-profit, proprietary operating systems, such as MS-DOS, Windows NT, MacOS as well as Solaris and SunOS. LINUX creators are extremely hostile toward these “for-profit” operating systems, and consider them monolithic, stifling creativity and healthy collaboration. LINUX allows users to tinker with the open and modular system making it very easy to adjust the code. The key to the rivalry is that LINUX creators are not motivated by profits—which of course changes the rules of the game. Instead, they are motivated simply by the joys of the creation and refinement of an open operating system used by millions of users worldwide.

Buyers and Suppliers

Many of the consumers of the product are also the creators, giving them the ultimate power to improve the product according to their wishes. In return for this feedback (or potential feedback for those who are just ramping up), the product is free. The inputs for the product could be defined as the general developing environment including the compilers and hardware. These inputs are primarily donated by the suppliers. This population has a fundamental belief that this work should be shared with the world in order for collaboration to continually improve the product. This free flow of resources between the buyers and suppliers allows the product to be offered free to the public.

Substitutes and Barriers to Entry

All of the substitutes are generally the for-profit operating systems listed above. These substitutes are not really viable alternatives for the users of LINUX because of their absolute disgust for parties involved in the production of these systems.

The barriers to entry for an entity to create an operating system like this are high. Because LINUX is an open and customizable product with so many resources available, it is difficult for another non-profit to justify the creation of another operating system like LINUX. Lumping the for-profit and non-profit operating systems together, the barriers to entry are: excellent technical reputation, large user base, network of smart users, excellent help support, and adherence to the UNIX general guidelines.

Summary

For LINUX, the key was getting a core group of talented UNIX programmers from around the world to donate their time and resources to the creation and support of the system. LINUX then developed an excellent reputation and an instant user base which had an incentive to make the product a success. This strategy also exploits the inherent mentality of the UNIX operating system user. The developers of LINUX and many other UNIX users tend to be academics or pure techies who fundamentally believe in the sharing of information. This passion for collaboration and hatred for the Microsofts of the world has fueled the tremendous success of LINUX.