Most open source companies are following a similar business model where they give the software away for free and charge for service and support. Are there limits to that business model?
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The limits to this business model are those described above -- running out of appropriate talent to provide services. In general, the more "core" a product is, the higher probability customers will buy support or purchase service. For example, it's unlikely that a user organization would purchase support for a development tool, because the downside to a problem is quite low; on the other hand, the probability of support purchase for a product like a database is much higher.
This was first published in January 2006
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