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“Open
Source will thrive in turbulent economy”,
that's the opinion of top Venture capitalists taking part in North
Bridge Venture Partners' annual Future
of Open Source survey. More importantly this is also the opinion
of Ross Turk, Director of one of our key partners,
www.sourceforge.net
I have to agree with them. Forget all the doom and gloom
“Worst in 80 years” talk. For anyone over the age of 25, trying
to remember past economic circumstances, the closest relative we have
to the current situation is the 2002-2003 downturn. I called this
period at the time, the Internet Nuclear Winter. This was the period
immediately following the bursting of the Dot Com bubble.
From 1997 to 2001 the world became
obsessed with “the next big one”. Every business attached a “Dot
Com” to the end of its business proposal, added two zeros to the
spreadsheet numbers and went looking for money. Everyone in the
software business was a potential Billionaire, and many of them made
it. It was much smaller, but anyone involved will tell you that “dot
com” was a far more intense bubble. When it burst, it dragged many beyond the internet business down with it.
However the dot come bubble burst
did not stop the Internet. Many of todays applications like Google
Search, Online Banking, Airline Bookings, Online Newspapers and the
Open Source industry itself, were born because of the Dot Com bubble ending. The financial systems may have stopped, but the technology
marched froward relentlessly. This ended industries like
Encyclopedias (Microsoft closes Encarta this month), and severely
dented High Street Banks, Travel Agents and print media.
In this Depression, expect to see the same result from Open
Source technology. In the 5 years that we have been in business. This
has been the easiest to give away a copy of TurboCASH. If you are
in the know and use TurboCASH then this seems ridiculous to you, but
the biggest problem we have is getting new users to forego their paid
for systems. The doanturn has brought on a solid dose of
rationality. Suddenly we find new users that previously would
simply have shelled out $ 1000 for a new Accounting package or
upgrade, simply because of the familiarity with the interface, now
look at TurboCASH first. Many of them are pleasantly surprised. We
have certainly seen an upturn in Accountants joining the project.
History tells us that the accounting
software business has one of the highest barriers to entry. Correct
me if I get this wrong, but there has not been a single case of a
mainstream accounting package taking significant market share for the
last 15 years. TurboCASH exists but by the grace of its 20 year
history and the fact that is now has the advantage of having the
lowest cost of delivery in the industry. We can deliver a high
quality accounting product in over 25 languages and into 80 different
tax regimes at zero cost.
Our competitors have completely
different financial structures. In particular, they are all public
companies with demanding shareholders. Most of their outflows go to
paying dividends, marketing programs and supporting outdated
software. Copy protection and physical distribution hampers
proliferation. Currently the market price of an entry level
accounting system is $ 200 per year and upwards. As revenues come
under pressure, the public companies have no choice but to up the
licence call on their captive users. In the industry this is know as
“goughing”. Expect to see a increase in the practice over the
coming year.
The Depression offers TurbpCASH the
best opportunity yet, to rip the market share from our proprietary
competitors.
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