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Re: What price do you want?



On Thu, 2003-09-25 at 12:58, Stephen Smoogen wrote:
> Ok I lets just cut to the chase.. what is the price people are willing
> to pay and how many machines are you going to have? Then figure out how
> many others you would need to sell at that price for RH to become
> profitable and grow (going off of SEC filings or whatnot).

Okay, I'll take a stab at this, but I'm only one person so I'm not sure
my comments will be representative of other universities.  Let's say that
hypothetically we'd like to have/support 100 machines.  We're probably not going
to replace them all in one year so the cyclical cost of $180 each time we
replace a machine is probably manageable.  However, paying $180 (minimum... more
if you want support) per machine, per year would come out to $18000 per year. 
That is simply out of the question.  We need some sort of volume discounts to
be able to cover the maintenance costs.  Let's say for argument's sake that we
could handle somewhere in the $2000 - $4000 range for "maintenance" costs each
year (ideally that would include support).  However, let's say Linux
popularity grew and we grow to 200 machines.  Should the cost double
($4000 - $8000)?  I don't believe so.  I could be wrong here, but I
don't believe RedHat's cost linearly increase as the number of machines
at a site increases.  My point is that there should be some sort of
volume pricing (at least for maintenance/support costs).  For example, $x for
0-100 machines, $y for 100-500, $z for greater than 500.  We simply can't afford
per seat licensing for a large number of machines.

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