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Linux maker Mandrake: We need cash
ZDNet News ^ | December 20, 2002, 10:11 AM PT | Stephen Shankland

Posted on 12/20/2002 11:54:35 AM PST by Bush2000

Linux maker Mandrake: We need cash

By Stephen Shankland
Special to ZDNet News
December 20, 2002, 10:11 AM PT

Linux seller MandrakeSoft issued a plea for cash Friday, encouraging people to buy products, MandrakeClub memberships or company stock. The company, based in Paris but drawing much of its revenue from North America, needs $4 million to pay debts and cover expenses in order to attain profitability. It's the second time this year the company has sought help from its customers.


"A very difficult time has arrived for us: We have a very big short-term cash issue," co-founder Gael Duval said in a statement.

MandrakeSoft isn't the only company to struggle with the business prospects of Linux, an open-source clone of the Unix operating system and one of several technologies once popular with investors. For example, the SCO Group changed its name to emphasize its Unix products, and Lineo, a maker of Linux for gadgets, this week was acquired under its new name Embedix by a Motorola unit.

Linux companies have seen some business success, however. For example, Red Hat, the top seller of Linux, has edged into profitability.

MandrakeSoft held an initial public offering on the unregulated Marche Libre exchange in Paris in 2001.

At the time, MandrakeSoft was trying to extricate itself from a change in direction that had seen it move from selling Linux to selling online educational services. The new strategy had sent revenue plunging, and the company was spending about $1.5 million per month, according to MandrakeSoft.

The company embarked on an expense-cutting campaign last year, but said Friday it won't be able to attain profitability by the end of the 2002, as hoped. It now hopes to move into the black in the spring of 2003 with the release of its next version of Linux.

"If you are concerned about MandrakeSoft's future, this is the time to mobilize," the company exhorted customers in a message posted on the company's Web site Friday.

Specifically, the company asked customers to join the MandrakeClub or upgrade their membership level. The members of the club get access to more software, quicker downloads and special promotions.

MandrakeSoft estimated it could meet the current cash hurdle if 20,000 of the company's estimated 200,000 customers signed up for a silver-level membership, which costs $120 per year.

The company also suggested customers buy products or company stock. Current shareholders may purchase stock at about $2.10 per share through a warrant operation, the company said.


TOPICS: Business/Economy; Technical
KEYWORDS: linux; mandrake; techindex
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Somebody please turn off the lights.
1 posted on 12/20/2002 11:54:36 AM PST by Bush2000
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To: Bush2000
Hey, I need cash too! I'm developing the first open-source sperm bank, and I need (female-only) beta testers and club members. Product swapping available for "Enterprise Servers with Clustering"
2 posted on 12/20/2002 12:01:28 PM PST by BuddhaBoy
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To: Bush2000
Hey! I thought you could get something for nothing!
3 posted on 12/20/2002 12:02:25 PM PST by TomServo
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To: Bush2000
Frogs need cash?<P.
I don't think so....
4 posted on 12/20/2002 12:02:39 PM PST by Drango
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To: Bush2000
Mandrake's distro does a great job at pulling it all together. I run 8.2. Haven't thought about going to 9 whereas my current version does everything I need it to and then some. But, if they go out due to monetary reason's, it'll be picked up elsewhere..
5 posted on 12/20/2002 12:08:22 PM PST by Michael Barnes
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To: unix
I want my free lunch.
6 posted on 12/20/2002 12:33:48 PM PST by Bush2000
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To: Bush2000
I guess its hard to make a profit selling free software.
7 posted on 12/20/2002 12:39:10 PM PST by Bob Buchholz
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To: All
I'd say, from a pure market analysis standpoint, there are far too many companies in the Linux distro market and some of them will eventually wash out.

And usually the French would be the first to go, in my experience. No big surprise. It's not like they're big capitalists, I mean, come on now.


I'd also bet that the MS-only folks who are so spooked by Linux that they actually push this propaganda campaign will make a pathetic attempt to use this to soothe their fears about Linux . . .

[shill mode]"See, this company isn't making a proit so that means Linux is doomed".[/shill mode]

8 posted on 12/20/2002 12:47:18 PM PST by Dominic Harr
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To: *tech_index
A "mommy, make the mean penguin go away!" ping.
9 posted on 12/20/2002 12:50:12 PM PST by Dominic Harr
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To: Bush2000
Gee whiz - Bill Gates has plenty of cash. Perhaps a business model change is in order?
10 posted on 12/20/2002 12:50:18 PM PST by strela
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To: Bush2000
Guess no one is going to get with child a Mandrake root anytime soon, now...
11 posted on 12/20/2002 1:28:33 PM PST by valkyrieanne
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To: Dominic Harr
A "mommy, make the mean penguin go away!" ping.

Surprise! The penguin will not be viable without commercial entities like Redhat and MandrakeSoft providing sales and support.
12 posted on 12/20/2002 1:50:38 PM PST by Bush2000
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To: Bush2000
I've never cared for Mandrake Linux. The distribution has always seemed "sloppy" to me. Their recent beg-athons are an embarassment. They should either take Debian's route and go non-profit, or just hang it up.

If you want a desktop Linux, Gentoo Linux is the way to go. Everything on my desktop boxes is built with PIII optimizations and runs the preemptive scheduler patches with X at nice -10. Very nice, smooth accelerated 3D video, audio playback with no skips or glitches, and the GUI is responsive even under a heavy load.

With KDE 3.0.4 and AA fonts enabled, the desktop looks quite nice. There are still a few issues to solve with font management, but all in all, I'm much happier with this distribution than any other I've used over the years (several).

13 posted on 12/20/2002 2:01:49 PM PST by dwollmann
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To: Bush2000
Shouting "mommy make the mean penguin go away (Bush)2000 times" won't make the mean penguin go away.

FreeBSD been around 20+ years. Still free. One of the best *nix distros out there. Debian likewise is a good free one. The world's universities are supporting the penguin.

Lindows goes shelf-ware, Linux low end PCs sold out at Walmart. Xandros announces new windows killer, stay tuned. Linux convention in NYC this Januaury.

Mandrake proves RedHat clone == no sales. Need to add real value which the French don't have.

snooker

14 posted on 12/20/2002 2:26:40 PM PST by snooker
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To: snooker
Linux is supplanting xBSD. Not imagination. It's happening. And the primary reason for this is commercial support and developer interest.
15 posted on 12/20/2002 3:27:47 PM PST by Bush2000
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To: Bush2000
Linux may get market share, but BSD will live on. Apple is a version of BSD, so is Solaris. Both have evolved past their roots, but still share a lot.

agreed ... The commercial support of Linux is winning.

But who really cares. A nix is a nix.

snooker

16 posted on 12/20/2002 5:02:09 PM PST by snooker
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To: snooker
FreeBSD been around 20+ years.

You need to check your facts on this one. The BSD source to attempt doing FreeBSD wasn't even accessible until around 1990. I was part of that crusade to try to make BSD source run properly on a PC architecture. It was a nice hobby, but it wasn't paying the bills. When a FreeBSD distribution roached my SCO Xenix partition (present since 1985), I spent a couple days trying to make the shoddy printer driver work so I could write my resume with nroff macros. It was a waste of time. I ordered the Windows NT device driver and OS releases (September 1992) and had a usable machine in hours. No screwing around with fixing device drivers. I stuffed MS Word on the machine and had the resume finished in an hour. The printed copy was perfect. By March of 1993, I had a contract with Hewlett Packard to port the Software Process Control Daemon backend of the SoftBench environment to build code on Windows NT 3.1 using the Visual C++ 1.0 compiler. I worked on the task with one other person and finished the task in 2 weeks. It was a fixed price contract for $40,000. That pays the bills :-)

The current FreeBSD website shows copyrights no earlier than 1995. That would make it about 7 years old, not 20+.

I'm an old UNIX hack dating from 1980 inside the Bell System. I've had full source code access for 22 years. It is still my favorite OS for server based work. I just purchased the latest Red Hat Linux 8.0 at the Barnes & Noble bookstore last weekend. It's a great platform for knocking out ANSI C & C++, web pages on Apache and servlets on Jakarta. It's cheap and nice. I can afford to buy updates because my commercial customers pay me well...for Windows 2000 based applications.

17 posted on 12/20/2002 6:12:26 PM PST by Myrddin
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To: snooker
Solaris is a bastardized mix of 4.3BSD and System 5.4 UNIX. It ticks me off to have to marketing weenies constantly screwing around with the filesystem layouts and included packages. I helped the Chief Principal Programmer for BSD4.3 (not Karels...Muller) fix some issues with the device drivers on the Tahoe hardware (CCI hardware). My company had a $15 million contract to buy 80 machines and that provided major league leverage to get problems fixed. Their kernel was System Vr2 mixed with BSD4.2. I had to do some surgery on the CPU scheduler code to get it to run right. Ditto for the MPCC device driver code, X25 L3/L2 code.

The point is that the System VR4/BSD4.3 hybrid system that Sun sells today isn't appreciably better than what I was using in 1986 from CCI. It's a bunch more expensive because of the marketing weenies. The only value in throwing money at Sun or HP for a real UNIX is that they have finer control of the underlying hardware architecture. That makes for a more stable machine environment. The FreeBSD and Linux varieties have to deal with a wide variety of PC hardware implementations. That takes a lot of time and effort to track. The main attraction is cheap commodity hardware and a cheap OS. If it's good enough to do the job, it's good enough.

18 posted on 12/20/2002 6:26:32 PM PST by Myrddin
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To: Bush2000
I want my free lunch.

Of course you do, but your not gonna get it from closed source companies..

BTW, is it true what I hear? You like spawning these threads simply to start flame wars?

19 posted on 12/20/2002 6:31:46 PM PST by Michael Barnes
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To: Bush2000
Specifically, the company asked customers to join the MandrakeClub or upgrade their membership level.

That idea holds about the same hope for success as placing a tip jar at a McDonalds counter.

20 posted on 12/20/2002 6:53:22 PM PST by TheEngineer
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