2005-09-24
Urchin / Licensing models / Open source
over at TextDrive they are upset that they can't renew the urchin data center licence
since the do-no-evil Google bought them, and seemed to have started a Petition/Survey to convince Google that they should continue their current licensing model.
Why should google be forced to continue a product pricing model they don't agree with. Google is all about running stuff on their infrastructure. Why do they want to maintain a expensive customer service centre and product development staff when they can host it themselves far more cheaply (and also get more of the pie at the same time).
They offer a Urchin subscription model which does just that, but I'm guessing that wouldn't be cost effective for TextDrive as it charges per domain or something, which gives TextDrive no volume break.
In effect Google/Urchin has decided that it is more profitable for them to sell straight to the customer, instead of going via middlemen like TextDrive. That is what business is all about, and it happens all the time, and why being a middle man for a large corporation is so sucky (if your too profitable you lose your business, when megacorp decides they want a bigger portion of the value chain)
So what can Textdrive do about it?
- They can buy another product (mint) with a similar licencing scheme (per domain)
- They could try bitching and moaning in the hopes that the public opinion would sway google to change their minds
These are the two options I currently see them doing. I don't belive either of these will work, or provide the end result they want. (Cheap web stats for their customers which isn't dependant on the number of domains they host)
Here is what I propose they do.
go find a server-side open source project which does/could do what they need. (go look at Weed for a example).
Take the license fees they would have spent on buying mint/licencing Urchin for say 3 years, and use that to sponsor/fund R&D work on Weed so that it has the desired functionality they need. The accountants will love it, as your are converting an 'expense' to a 'capital expenditure' which means they can depreciate it over multiple years, instead of just one (meaning higher profits).
If you want this to work even better, you could approach other urchin datacenter licencees and persude them to use 1-2 years worth of expenses to fund R&D on a product which will meet their needs and be opensource/free of licencing fees from then on. The Weed developers would like it, as they could quit their day jobs/get paid to do something they love. And possibly start a support/consulting company around the product they develop which they could offer to other people. (even turning it into a ASP-type service later on and charging people that way)
Now thats the power of opensource development model.