August 23, 2001

10:38 PM

I think I just melted my irony meter.The radically innovative new plan at VA Linux is to reach profitability by selling proprietary software. (Larry Augustin has invented Microsoft!) But not just any software; they're going to sell the software which operates SourceForge, one of the largest repositories of open source software in the world. And this is now going to become the core business; they may even change the company name. I can't wait to see what the folks on SlashDot think of this! (VA Linux also operates SlashDot.)
posted by Steven Den Beste (18 comments total)

I think there are going to be a few riots within the Linux community.....
posted by spidre at 11:15 PM on August 23, 2001

Let's see if Slashdot has the guts to post it. Because they can pretty much kill all commentary by just not putting it on the front page...
posted by darukaru at 11:51 PM on August 23, 2001

Did anyone really think that the free-software business was going to be profitable? Its scavenging time. Nothing wrong with playing both fields, unless sourceforge is currently GPL'd.

Slashdot will post this, I think that their parent company doesn't get any content control and even if they did burying this would quickly kill what little credibility slashdot has left.
posted by skallas at 12:35 AM on August 24, 2001

Sourceforge is GPL'd, you can download the source here. This version doesn't seem to have been updated since last May. But, if you really want to setup your own sourceforge, you can still do it for free. The enterprise software is probably only going to make things a little easier to setup and install, although I don't know for sure of course.


Finally, There have been ads Running for Sourceforge On Site: The power of open source, behind closed doors on kuro5hin and slashdot for months, so it isn't like the Linux community doesn't know about this already. There have been a few comments, but nothing major.


It looks like the real news here is that they are moving to make SourceforgeOnS their main revenue source.
posted by delmoi at 2:52 AM on August 24, 2001

The question is this: if they go down the tubes will slashdot go with them? (Oh wait! slashdot went down the tubes a long time ago! I had forgotten that for a second.)

Good riddence to them all. I sort of feel bad for these people that took millions of dollors in investment money and were unable to build a sustainable biz, but I feel worse for my parents retirement fund which (outside of their control) lost 30% because of all this garbage. On some level it is morally wrong to mess around with other people's dough.

Also: Sourceforge is great, but how many projects use much beyond their filehosting and CVS? Most companies I've written software for have enough problems just installing CVS, much less a giganto application like this.
posted by n9 at 5:11 AM on August 24, 2001

Slashdot did post it.

People don't seem to think that it's a really big deal. I'm not really suprised at the shift.
posted by Localemperor at 5:58 AM on August 24, 2001

this isn't the first company to do this. i forget who did it for the life of me, but i did report on it for my company a month ago or so. basically, va linux is going to sell proprietary and open source software, as they seek to find a balance between having open source roots and actually making money. there was another linux company who did this earlier with their operating system. anybody know who this is? i am having a brain freeze right now...
posted by adampsyche at 6:14 AM on August 24, 2001

I sort of feel bad for these people that took millions of dollors in investment money and were unable to build a sustainable biz, but I feel worse for my parents retirement fund which (outside of their control) lost 30% because of all this garbage. On some level it is morally wrong to mess around with other people's dough.

How is it immoral for a retirement fund manager to invest the funds? Every fund I ever put money into has sent volumes of paperwork telling me what the manager would do with the money, what kinds of investments are being made, and what my risks are. I'm guessing your parents get the same stuff.

It's a shame that companies like VA Linux attracted billions of investor money behind open-source business models and are abandoning them less than two years later. However, if the company stuck to a strategy it didn't believe in any longer, would that be better?
posted by rcade at 6:23 AM on August 24, 2001

you know -- my thoughts are this are completely ill-formed. But my folks actually didn't choose their fund, their employer did, so there you go.

What I am really outraged at is (and maybe everyone thinks this is stupid) that *hypothetical_person* decides in 1999 to do a startup and the biz plan is ludicrous and it flops in 2001, after spending 60M$ in venture cap and 200M$ in IPO cash they die. Sometimes this is because of chance, sometimes poor decision-making on many peoples' parts. And sometimes everyone knew this was going to happen and the press-released themselves through their IPO and fleeced the investing public (including people's retirement funds.)

In any case, hundres of millions of dollars is a lot of dough. If you ask for it are you not on some level ethically liable if by plan or mistake you loose it? That money could have done so many things besides buy you 6M$ of oracle software -- like pay for someone's retirement!

We are not talking baseball card trading with companies here -- I think that the last two years have desensitized a lot of peope to the seriousness of Money. It is not to be handled like so much paper. We see 500M$ this and 32B$ that in the paper and it seems like no huge tragedy (or crime) when a mismanaged company that changes biz models many times and makes questionable purchases of several hundreds of millions of dollars bottoms out with no return to the investors.
posted by n9 at 10:17 AM on August 24, 2001

n9
At the risk of sounding callous, no one is forcing anyone to invest in those companies. People are looking in on the 'ground floor', and make a killing. It doesn't always work. If you don't like it, don't invest.
posted by das_2099 at 10:52 AM on August 24, 2001

the issue is that many americans don't have the choice, das! And if Social Security begins investing the issue will be much worse. Not only that but all of our economic well-being is tied to market issues regardless of our personal investments. It is naive to assert "don't invest if you don't like it." 1.) If the market crashes, we're all hurt very badly. 2.) At my company my _only_ way of saving for retirement is in a 401k and there are four options in this, all of which have been heavily impacted by the dot bomb. By your logic, das, I could say "If you think that US healthcare is in such a shambles perhaps you should opt out of your plan and be uninsured." Like so many hard problems this is one that we are all in together, unless you go live in a yurt and make your own food happen _and_ don't have friends or family and expect not to become disabled before you die.

My point is that wasteful, risky business endeavors are (obviously) a waste of resources and that this wastefullness has an moral/ethical weight. If you blow it for yourself and your investors it isn't jsut your neck on the line... you wasted human resources ($$) that could have been use in other ways, ways that would go to what I believe our main project should be: helping each other. That is all. Perhaps we are talking about too many things:

corrupt brokerage houses not disclosing their tie-ins and affiliation with stocks that they invest your money in to sell you on.

the end of the pension system of retirement savings.

insane wastefullness and poor decision making of many people involved with the finance industry.

gereralized money sucks rich->richer(); poor->poorer(); bellyaching.

sorry but these stories and the post bomb market in general is just so alienating. I keep my money in a savings account and have endured people telling me that it was 'wrong' to do that and how I wasn't helping anyone like that, etc. blah blah blah.
posted by n9 at 12:02 PM on August 24, 2001

If you're looking for a villain here, blame the investment banks that foisted all of these turkey IPOs on the world so they could pocket huge fees for their role in the offering. Without their help, investors like your parent's retirement fund manager could not have been capable of raising stupidity to such heights.
posted by rcade at 3:58 PM on August 24, 2001

n9:

This is the way a market ecconomy works. When you invest money, you risk it. You should try to spread your money out so that if one corp fails you won't be wiped out.

9 out of every 10 venture capital funded companies dies. The VCs make enough money from the 1 to pay for all the others. If no one was willing to invest money, great things like Apple Computer, Sun, IBM, hell... even ford and Boeing simply wouldn't exist. I mean, who knew how big PCs were going to be when The two steves started?

Who knew how big Open Source was going to be when companies like VA and Redhat filed their IPOs? So who knew wether they would make it big or not.

If you don't take risks, you don't make much money. (I did find VA's bussness plan a little retarded, actualy).
posted by delmoi at 5:42 PM on August 24, 2001

When you invest money, you risk it. You should try to spread your money out so that if one corp fails you won't be wiped out.

What part of "At my company my _only_ way of saving for retirement is in a 401k" is so hard to understand?

Some of us can't opt out of or control our retirement funds.
posted by Zettai at 8:04 PM on August 24, 2001

What part of "you chose the company you work for" is so hard to understand? The kind of benefits you get, and the way they are administered, is a factor to consider when choosing an employer.
posted by rcade at 6:37 AM on August 25, 2001

rcade -- if it were that easy then I would not be pissed. just to name a few companies that I have worked for where this is SOP:

The New York Times
New York TImes Digital (www.nytimes.com)
Random House
Time Life Inc. (AOL)
3 private schools
two school districts

Companies where I had options besides a market-based retirement fund:

(none)

Benefits are a factor in choosing an employer if you can afford to take it into consideration, certainly, but this style of retirement handling is everywhere as No company wants to manage a conventional penioning system. So do your homework and if you happen to know of a publishing technology UNIX software developer job where 401ks are not the only method of savings in NYC that is looking for an honest worker let me know.

But I'm an a much better place than my folks who both have worked at the same place for 20+ years -- their places of employment switched over to an investment based retirement fund from an older pension program without employee approval -- and I am told this was a very common practice last dcade.
posted by n9 at 7:27 AM on August 25, 2001

What other kind of pension program are you talking about, n9? I've never heard of any kind of retirement program other than a 401(k), and I can't imagine why anyone would have a problem with 401(k). Clearly my education is lacking.

As far as I can tell it's just a method of deferring taxes on long term savings, where the savings is usually held in something a lot more sensible than a savings account. I don't really understand where the objection to this would be.

I've worked at two companies that offered 401(k) programs, and in both cases you got to choose the fund your money landed in (or even distribute the money among several funds). I believe funds based on treasury bonds were among the options. Is this not the case where you work?

-Mars
posted by Mars Saxman at 8:55 AM on August 25, 2001

Companies where I had options besides a market-based retirement fund

Any fund that has done poorly the last 18 months because of the Internet bust was probably experiencing record profits in the two years before that, because of the Internet boom. It's a live-by-the-sword, die-by-the-sword situation. I don't understand the source of your bitterness, aside from the notion that it sucks to lose money instead of earning it.
posted by rcade at 8:01 PM on August 25, 2001