[WBEL-users] Dell: Red Hat needs to lower prices

[John Hinton]

Forrest Samuels wrote:

>I am sure many of you read Slashdot (where I saw this) but I thought this
>was a very relevant article:
>
>"Red Hat needs to lower its prices, or risk losing customers to free
>versions of the open-source operating system, the Dell executive who
>oversees the partnership with the Linux seller said Tuesday."
>
>http://news.com.com/Dell%3A+Red+Hat+needs+to+lower+prices/2100-7344_3-548223
>4.html?tag=st_lh
>
>I find it interesting that they don't mention the RHEL clones in the
>article, just Debian and Solaris 10.
>
>-Forrest
>  
>
I personally believe this is a much broader statement by Dell. One which 
is an opinion that RedHat is driving away Dell's clients who have been 
buying systems with RHEL installed. I think the reference to 'attitudes' 
when a tech becomes popular, was one where those companies ran their 
prices up significantly, only to find soon after they were in trouble 
due to lack of sales. Is it better to sell one item at $100 or 20 at 
$10. That is a hard question for all businesses.

I believe Dell couldn't consider the clones of RedHat for two reasons. 
One, they need to strike a deal with a company to insure the continued 
support of the software Dell is selling and setting up on their 
machines. Two, I think they are predicting bad times ahead for RedHat, 
and if RedHat suffers from bad times, so will all the RHEL clones to 
some degree.

The fact that WBEL and the clones exist, is testiment to the fact that 
RedHat has no affordable alternatives for the small to medium sized 
business. One can buy once, a Microsoft server package for about what 
Redhat wants for two years of RHEL. At the end of that two years the M$ 
package is yours. At the end of that two years you are still paying 
every year of the RH package. I just see something vastly wrong when a 
Linux package full of open source software cost more than a M$ package. 
I couldn't chew it. We have about 12 servers online now. We need bind on 
them. That puts us into the $349 per year subscription. That's $4,188.00 
per year. That's a LOT of money for us. When there are altenatives, such 
as Debian, which provide all we need, there is no way spending that kind 
of money for something which is available for free is going to fly here. 
I was actually headed off to Debian when Whitebox came along.

Yes, I still feel stung by RedHat and its change in policy. At the 
moment of announcement, we were running only a few servers and had our 
one free subscription plus subscribed the others. We do like to 'donate' 
to those providing good when we can. I often times purchased the boxed 
editions of Redhat to try to get some extra money their way as well. 
But, to go up from what was costing us $200 per year to a whopping one 
time leap for three servers to over $1000 per year, while at the same 
time we were bringing on more machines (therefore the 4100 cost). That 
was simply just too much to swallow.

I think Dell is making a prediction the Redhat might be doing well at 
the moment, but that it is only doing so due to clients who were caught 
in the 3 months to decide what to do phase, and just had to sign up with 
Redhat. As time passes, folks can find alternatives and move away. To 
me, the bottom line... RedHat's prices are too high. I'm glad a 
strategic partner made the public statement. Fedora for me is 
potentially too ragged. The number of RHEL clones makes a very loud 
statement in and of itself.

Best,
John Hinton