Date: Sat, 14 Nov 1998 13:08:38 -0800 From: Mike Smith <mike@smith.net.au> To: Kirk Fort <kirk@patrohn.com> Cc: chat@FreeBSD.ORG Subject: Re: FreeBSD finances Message-ID: <199811142108.NAA07371@dingo.cdrom.com> In-Reply-To: Your message of "Sat, 14 Nov 1998 15:20:36 EST." <19981114152036.09845@kfort.dyn.ml.org>
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> On Sat, Nov 14, 1998 at 11:48:46AM -0800, Mike Smith wrote:
>
> > I'm particularly interested to know what Mr Fort's interest in the
> > matter is, as it would be easier to answer his questions if we knew
> > what they actually were.
>
> I don't have an specific interest (I'm not an IRS agent, if thats what
> you mean), but I here that WC gives freebsd all the profits from te
> sale of the CDs.
I don't know where you heard this, but this isn't the case.
Walnut Creek CDROM spends a lot of money on the Project, yes, but there
is no such formal agreement (and indeed, if you think about it for a
moment, there would be no incentive for such an agreement).
WC has never, to the best of my knowledge, given money to the FreeBSD
project. Assistance has always come in the form of non-cash assets
(eg. hardware, resources) or intangible benefits (marketting exposure,
promotional materials, etc.).
> With 4 releases a year at $25 dollars each, it
> wouldn't take many people such as my self (I have the WC
> subscription), for it to add up to a sizable sum. JKH said that its
> $10k a year, with 90% going to equipment. I'm interested in how
> popular freebsd is. My guess is that there are no more than about 200
> people on the subscription, probably much closer to 100 because not
> all of the 10k is coming from subscription sales.
Since you're working from fundamentally flawed numbers to start with,
none of this holds. I'm not at liberty to discuss the actual numbers
involved, but I can say that you're *wildly* off on the low side.
> The second part of
> my question was answered when someone said that FreeBSD is
> incorporated. Correct my if I am wrong, as I am not a business lawyer,
> but don't corporations have shares of stock, whether public or
> private? I guess that JKH has all the shares, and that is fine. I was
> curious because I see alot about FreeBSD's development model, but
> nothing about its business model.
Again, it's public knowledge that FreeBSD Inc. exists for a very
specific set of reasons, and principally so that other corporate
entities can make donations in a fashion that's comfortable to their
internal accounting policies.
The FreeBSD Inc. business model is simple: get donations from people,
spend donations to improve FreeBSD.
There are other related business models - those of people like Walnut
Creek, Pacific Hitech and CheapBytes for example. You'll have to guess
at these from what's generally known.
> So I guess my main question was, where does my money go, and how many
> people like myself are giving money.
Money donated directly to FreeBSD Inc. is spent primarily on the
following types of items:
- Hardware for developers (eg. new cards for driver development,
systems for testing purposes, other infrastructure).
- Consulting fees for developers specifically working on focussed
FreeBSD-related issues.
- Promotional activities.
The majority of donated funds are spent on hardware; we do our best to
look for corporate sponsors for consulting issues, and opportunities for
cost-effective use of donated funds for promotional activities are rare.
There is a very strong feeling of responsibility towards donated funds,
and we look hard for ways to spend them effectively.
Walnut Creek CDROM is known to support the FreeBSD Project in at least
the following ways. You'll note that none of these involve giving cash
to FreeBSD Inc.
- Providing ftp.freebsd.org. It was mentioned publically recently that
going by CRL's published pricing, WC must spend something on the order
of $20,000 per month for network connectivity for this system alone.
(I don't actually have access to the real figures, nor would I be
able to confirm or deny them if I did.) The system itself was
recently upgraded to 0.5TB of disk space. You can do the math to
work out what this must have cost.
- Employing Jordan Hubbard, David Greenman and myself.
- Providing hardware for the FreeBSD Project cluster. There are 8
machines in the cluster, plus infrastructure hardware. Turnover on
these systems is reasonably rapid (most are < 12 months old), and
storage requirements continue to explode.
- Supporting the FreeBSD Project cluster; this includes the T1 it sits
on, air conditioning for the room, and the time that Jordan and I
spend maintaining it.
- Producing and distributing promotional material. The FreeBSD
newsletters, the stickers and labels, T/polo/denim shirts, etc. are
all produced by WC, and either given away or sold at about cost.
- Sponsoring FreeBSD developers to conferences, trade shows, etc., and
not just the ones that WC employs.
- Donations of substantial numbers of FreeBSD CDROMs.
So, if you're making direct donations, your money is spent by FreeBSD
Inc. If you're buying CDROMs from WC, your money goes to Walnut Creek,
who will spend a substantial portion of it on the categories above.
As both FreeBSD Inc. and Walnut Creek are privately held companies,
they're not required (and I'm not at liberty) to disclose "who" or "how
much", but you're welcome to do the arithmetic on what's public
knowledge and get an idea of the scale of things.
I hope this gives you some idea about what goes where.
--
\\ Sometimes you're ahead, \\ Mike Smith
\\ sometimes you're behind. \\ mike@smith.net.au
\\ The race is long, and in the \\ msmith@freebsd.org
\\ end it's only with yourself. \\ msmith@cdrom.com
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