A lot has been made this week about a blog post which appeared on the Elementary OS website discussing the monetisation of the project.
If you visit the Elementary OS website there is a box with the value of $10 already filled in and a download button.
Underneath the download button there is a link which lets you download the distribution for free.
The blog post on the Elementary OS website states that the current download options are changing and there will be more encouragement aimed at getting users to part with their money.
We want users to understand that paying for software is important and not paying for it is an active choice. We didn’t exclude a $0 button to deceive you; we believe our software really is worth something. And it’s not an attempt to get rich quick; currently the only people who have received money for working on elementary OS have been community members through our bounty program.
It’s about asking a fair price to offset the costs of development. It’s about securing the future of elementary OS to ensure we can keep making software that millions of people love and use every day.
Elementary isn’t the first Linux based operation to complain that they aren’t making money. I remember reading an article about a Linux blogger who stated that he either needed to start getting donations or he would have to close the blog down. (Click here for the article)
This article by Bruce Byfield on DataMation looks at the difficulties games publishers face when developing for Linux. (Click here for the article)
Then there is Ubuntu. Now the article I am linking to here is from 2013 but it states clearly that Ubuntu is still not making money despite being around for a decade. (Click here for the article).
So the question is, can you really make money from Desktop Linux? If Ubuntu doesn’t make a profit how can others achieve success. Does it even matter? Is Linux just a labour of love?
Clearly sooner or later Ubuntu needs to make money. Canonical are a company and so either Ubuntu works as a loss leader in order to make Canonical money in other ways or it generates profit for itself. If neither of these things happen then it will all come crashing down.
The key for me though is in the last paragraph. You don’t need the distribution itself to make money in order to make money for the company. It is all about generating income from more than one revenue stream and that is what this article is about.
If Mark Shuttleworth didn’t believe he was going to make money at some point he would have stopped already.
Over the years a number of avenues have been attempted to increase the income for Ubuntu including Amazon adverts within the Unity desktop interface, the Ubuntu One music store and now the Ubuntu phone.
Some distributions use a default landing page within the web browser installed with the distribution which include a set of affiliate links or a search tool which generates income for every search made.
The trouble with the Elementary OS stance is that you are asking people to spend money for something that 100 other distributions offer for free. I appreciate that a huge amount of effort has gone into the look and feel of Elementary but an equal amount of effort will have been put into Cinnamon for Linux Mint or Enlightenment for Bodhi Linux.
Effort doesn’t always translate into cold hard cash. I can state that as a fact based on the amount of money this site makes.
Now this site is clearly a labour of love. I am a software developer and SQL DBA by trade and the hourly rate returned by writing on this blog is miniscule by comparison.
The site does return an income each and every month however and from a number of different revenue streams.
For instance, you will have seen the adverts at the top of the page and down the right side of the page. Google Ads are a great way to make enough money to pay for hosting fees (and a few pints of beer). Every time somebody clicks on an advert this site makes a little bit of money.
I have tried a number of ways to increase the income. I even tried writing a book and to be fair I have had a little bit of success with it. It has sold about 100 copies thus far. Not everything works though. My attempt at humour failed spectacularly with this one. It turns out I’m not half as funny as I like to think I am.
I have written dozens of Linux distribution reviews and within each review I link to a site called OSDisc.com as a resource for buying Linux DVDs and USB drives. I try to only include affiliate links that are useful.
OSDisc.com sell Elementary OS on DVD for $5.95. The Elementary OS team are asking for $10 at the moment and hope to generate much more than that with their new site design.
Potential users have the option to download for free, buy a DVD for $5.95 or download from the Elementary OS website and donate more than this.
Jeff Hoogland made a great point on the LXER discussion board:
If they were serious about getting payment out of folks they’d pull an elive and add a step to the installer that requires a “donation”, but that would require you know – actual work.
Asking people to donate at the point of download is perhaps a bit counter-intuitive. How do users know that they are going to use the product long term before trying it out first? The only way to try out the product is to download it, try it as a live DVD or USB and then possibly install it from there. Even then many distrohoppers only use a distribution for a short period of time before moving on. It would therefore be more beneficial to add a payment option when actually installing the product or after 30 days of continued use.
The new layout for the payment options made by the Elementary OS team may well actually work to a certain extent.
There is a term used by bloggers called a “Call To Action”. The idea is to basically ask the readers of an article to do something such as retweet a link to the page, subscribe to an email list or add a comment. Simply having an email box on the right of the screen isn’t enough to attract subscribers and just having social media buttons doesn’t mean people will click on them. You have to point them out to people in the first place. More than that though if you want people to sign up to your email list you have to offer to give them something.
How many of you even noticed the email signup box on this site let alone be tempted to enter your email address?
By making it easier to make a donation and harder to get the download for free, the Elementary developers will lose the users who were never going to pay them any money anyway and only get users who are serious about using their product. This might be considered a good thing as it gets rid of the people who aren’t real customers.
The main issue with this approach is that you reduce your ability to generate income from other revenue streams. If you have 1,000 users every day downloading your distribution without paying then at the end of the month you could have between 28,000 and 31,000 users who could buy other things that you sell based on your distribution.
If you start charging for the distribution then perhaps 1% of the people that currently download the distribution will now actually pay for it and so you only have between 280 and 310 new people to sell extra products to.
Wouldn’t it be better to create extra revenue streams and encourage people to buy extra add-ons or features? You can get $10 out of a few people now or upsell add-ons again and again. It is all about providing extra value.
Android and IOS developers worked this out ages ago. Most casual games found on tablets now include in-game purchases and they work. I am far less likely to buy a game without trying it first than one that lets me play for free but charges me for extra features.
Zorin OS utilises this method to generate income. The core Zorin distribution is free but for features such as the OSX look you have to pay money.
You don’t have to make money from the distribution itself to make money. You can make money by selling services such as selling training courses, webinars or technical support.
Sometimes putting effort into one project gets you rewarded in a completely different way altogether. For instance, I might not make much money from this blog and I never started the blog with the intention of making money but by doing so I was asked to write for About.com which does actually pay quite well.
So is Linux a labour of love? I think that there is money to be made but not in the traditional sense of just making a single product and selling it. If distributions are out to generate income then they have to be a bit creative about how they do that. Multiple revenue streams are definitely going to be important.
I think charging for a download may help to generate income in the short term but it will ultimately mean missing out on possible revenue streams later on.
The debate is much like the newspaper paywalls. Would you really pay to read a newspaper online when the BBC provide similar or sometimes better information for free? Therein lies the problem for Elementary.
Thankyou for reading.