As shown is this slide deck, RedMonk co-founder Stephen O’Grady writes that a new Top20 software company hasn’t emerged in over 20 years because the real value today is in big data.
In a very real sense, software is becoming a vehicle for generating data; a means rather than an end. Open source software vendors are universally poor at customer conversion. The best of them converts one out of a thousand users into a paying customer. What they give up in conversion, however, they gain back in distribution. Open source software enjoys intrinsic advantages over commercially licensed alternatives with respect to its ubiquity. Until they begin harnessing this distribution in the form of data aggregation, however, this advantage will remain underleveraged. Which is unfortunate because it is a model that inherently better aligns customer requirements with vendor needs.
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