Open source corporate strategy IBM
McGrath stated his talk by referring to Carlota Perez "technological revolutions and Financial capital"
Dan said that found a remark "Tech revolutions force changes that have patterns" Perez made true. The patterns are:
1) Hype, over investment
2) Bubble and crash.
3) 20-30 years of implementation of the technology or so called gold age.
Business strategy implications
Most of the industry leaders are thinking: "I have inherited a business that is built on industry revolution." Shared global pools of resources including labor, capital and shared digital infrastructure impact the way we can do business.The division of labor has improved because the digital tools enable new kind of efficiency. Inventing collaboration conducts is necessary to get the spread resources working toward common goal. It is not only businesses that need to rethink the way they work. Other institutions are also affected by the disruptive changes created by technology. Adaptive change in laws and institutions takes a long time.
Companies are looking what to out source, how to adapt procedures and ways to remove inefficiencies with new technology. Removing the inefficiencies means a business opportunities.
Out sourcing is only one possibility. Think of who could do the job the best? They don't have to work for you. They might be part of a group of people who have the similar goals than you.
IBM open source strategy
Ownership don't matter for IBM. Client value is what matters. After IBM moved to support software built on Apache their application server share had arise from 10-50%.
Solution integrators Li & Fung limited, IBM
Platform architects SAP
Module Specialist FedEx, Flextronics
IBM spends about 100 million dollars on Linux development. The amount isn't big compared to money they spend (500 millions) to competing platform.
The trick is that industry co-operates to get costs down to create more value to buyers.
"GPL helps us to invest 100 million and rely that we get the benefit from the other players who invest over 1 billion dollars annually."
"We are so deep in the open source world that the company would have to completely fail before going back to old way of doing business."
Old software that doesn't serve to have developers working on it, has to still be supported. Chopping it to modules help us to push it to open source world.
Our patents come mostly from our customer relationships not from research facilities. They come and tell that they have a problem they want us to solve. IP for IBM means strategy not just a work to IPR lawyers. We are looking at our patent portfolio. We are proud of it and have invested in to it. How do we use those? Traditional model; being sole provider of the product
1.) Traditional model of having a (5%)
2.) Licensing (5-10%)
3.) Cross licensing (vast bulk 75-80%)
4.) Give a patent to 'public domain' (patent pledges and patent commons)
"Patent trolls and IP consentrated companies are threat to innovation. We are really in favor for patent challenging. This would help to eliminate bad patents from the market."