Joi Ito and Geir Magnusson talk about making money with open source.  Joi says you can compete with numbers of customers, not code, when you have an open source business.

Geir works for IBM because he came from a company providing support for people using Apache Geronimo. IBM bought the company, and is keeping the same model.  Later he says that enterprises want the support services, because "they want one neck to choke."

Joi says he knows a Japanese bank going to Linux and all open sourceware.  They've cut the cost of the bank to 10% of what it was, and that investment has paid out.  It's easier to save money than make money, someone notes, with open source businesses.

Joi asks:  is it really true that big companies re-release the modifications they've made to open source?  The response:  big companies like interactions between professionals, so they'll work professionally with the open source community; IBM does a good job as being a steward; neither big companies nor open source people are idiots.  

Joi says St. Gallen did a course on management of software and published all the results as case-studies.  The companies didn't mind having their competitors see this information, because they weren't competing on this basis.  The lesson is that sharing information (like open source software) often has no competitive impact on a company that isn't primarily in the business of developing software. 

Sometimes people release things under open source just to get market share and put competitors out of business. 

Joi notes that there's an interesting relationship between open source and open standards.  Ability to influence a standard can have enormous effects.  Bram Cohen notes that he's reluctant to add new elements to the BitTorrent protocol that don't make sense from an engineering standpoint.  HTTP 1.0 was straightforward; HTTP 1.1 went into a huge list of features and was a disaster from a software engineering standpoint.  Protocols aren't being worked on well.

We drift into talking about open source and protocols.  There are lots of BitTorrent clients that don't use Bram's software.  Bram stewards the protocol and provides technological leadership.

Chris DiBona notes that standards bodies take enormous resources to follow, much less dominate.  He talks about a process that can fix particular problems by just having Yahoo!, Google, MSN engineers talk to each other (eg, "nofollow").  Things can emerge that don't have the blessing of standards bodies but that act like standards. Broken/expensive standards don't get chosen.

Joi says that the rest of the world is just at a tipping point with open source.  Brazil is getting it, but other countries aren't there; they're still looking for certificates and authenticated things.  Peope get fixated on proprietary material.  Similarly, companies like to set rules and open source often gets filtered out.  Not paying is psychologically scary ("you get what you pay for").

Having the best product isn't the answer in software sales, says Joi.  Often it's having the sales channel or consulting services -- and bragging customers.

The open source companies in the room care a great deal about the terms of the license associated with their software.

There are companies that are Windows shops just so they can use Windows calendar.  Why is there no open source replacement for this?  Chris DiBona:  Exchange is easy to install, easy to use, lots of devices only talk to this program.  This battle will go on for another 30 years.

Calendar sharing, contact book management - all this is a big issue with open source.  It's not happening.  Pulling something together to solve these problems is hard.  There are so many independent entities. 

Joi says the customer can drive this.  It's harder to do a Chandler than for a bank CEO (or the army) to fix this himself.  A bank CEO can assign 150 people to work on the problem.  But the open source community isn't working effectively on synching yet.  And MSN is giving away product to avoid the open source threat (this is just a rumor).

Salesforce.com did a tool that manages 75% of customer relationship management -- sometimes doing just enough is...enough.  They made a fortune.  We need open source calendaring that is "good enough."