Canonical Platform Control, Bites!

According to network world, Canonical were asking for 75% of Amazon referral revenue from the sale of music through the newly selected Banshee music player.

I must note, that I don’t use Banshee and this isn’t about that program. This move by Canonical is a demonstration of lack of long-term consideration which can not be ignored by the larger Ubuntu community.

As I’ve been warning about in the past with the UbuntuOne services; the main issues weren’t the closed server code but a far bigger issue was the ability of Canonical to over-ride the best interests of the Ubuntu community in order to promote it’s own corporate interests. Historically Canonical have had fairly good self-control with their platform control, making sure to defer to the technical board for decisions. Since UbuntuOne however, we have progressively less self-control and in my eyes, less trust.

What worries me is that this is a continuation of a line of manipulations of the platform for UbuntuOne. We have Microsoft and Apple as a measuring stick of platform manipulation; if it looks like they would do it, you probably shouldn’t. Which in this case, removes revenue from a key software supplier or at the very least degrades our ability to work with Gnome.

I think we need a company with Canonical’s control to be thinking about money in Ubuntu the ecosystem and not only to it’s own business; a healthy ecosystem requires many different and overlapping organisations, all able to make money from the platform. Although I admit that Canonical is young, it still should be focusing on a foundation of models that it hopes to take forward.

Every time this sort of thing happens, it makes it harder and harder to recommend Ubuntu to new users. I just can’t guarantee that their experience has been considered in their best interest. Sooner or later it’s going to be easier to recommend other platforms.

Your thoughts?

Update: I reworded some of the text for clarity and directness.

24 thoughts on “Canonical Platform Control, Bites!

  1. Is it just me, or is the UbuntuOne file synch system absolutely snail slow for everyone else as well? So far as I can tell, DropBox kicks it’s ass three ways to Sunday.

    Many people asked, “Why write something like this when DropBox offers it for free and it already has a version for Linux?” Best answer I could come up with was that they could support their music store offerings if they had their own system.

  2. I think it is a fair move by Canonical. The Amazon store isn’t really a part of of Banshee and is only there as a small contribution to the broader GNOME foundation. As the network world article states the store only produces $10,000 of income for the foundation. Which really is nothing… you can’t hire a paid developer full time for a year (or even half a year). Of course this number would increase with inclusion in Ubuntu but the funds generated through this method are going to be less than what Canonical generates through it’s partnership with 7Digital (Note this is assumed and I realize I may be wrong). Moreover, these funds are also a lot less stable since Amazon reserves all/most rights as part of it’s associates program TOS but as Canonical retains a partnership status with 7digital it is assumed they do have some more influence and possible legal recourse in the event something hurts Canoncal’s income stream or the customers (like introduction DRM or something pure EVIL).

    I am not the biggest fan of this move but it is a hard situation to deal with. Placing a competitor’s product inside your own application where the competitor earns the majority the revenue (with 10% going to GNOME) is not a pill I would swallow willingly.

  3. I agree that Canonical’s decision was short-sighed and just sounds like a bad move to the vocal anti-Ubuntu crowd. I mean Apple’s been getting some heat for its new subscription policy wherein Apple gets to keep 30%, but 75% is even more so. I guess Canonical was thinking this was free money from Amazon and was taking away from their less useful Ubuntu One store but Gnome developers need funding too.

  4. I don’t agree with your assessment here. Several things:
    1. Your statement: “We need more money going to the ecosystem and not to Canonical.” Canonical is part of the ecosystem. No one is arguing that Canonical should be the only one to make money. Seems like you have a bias against Canonical because it’s a private company. Canonical succeeding financially is a great thing for open source and free software.
    2. Your statement: “removes revenue from a key software supplier.” This is not the case. If Banshee were not the default in Ubuntu, GNOME would not have gotten money off Ubuntu users anyway (maybe a small percentage of those who install it themselves, highly unlikely to be 25% of users).
    If Banshee had agreed to the 75-25 deal, GNOME would have had more income than before Banshee was default. So, it’s actually win-win. No one is removing revenue from GNOME. Somehow people only focus on: oh Canonical is taking too much of the pie. But “too much” is entirely too relative.
    3. Manipulations of platform. Software always come with a default, so for Canonical to be deciding defaults is natural. It must be remembered that it is in the best interest of Ubuntu users to see Canonical make profits. (No, I am not working for Canonical or related to them).
    4. Ubuntu is free software. You can always change anything you don’t like, it’s not a lock-in.

  5. We need more money going to the ecosystem and not to Canonical

    I heard that this was discussed during default selections during UDS about the store? Was it? BTW Isn’t Canonical part of ecosystem?

    @Geremy

    herein Apple gets to keep 30%, but 75% is even more so.

    Apple keeps 30% of the sales. If a thing is priced for $10, Apple gets $3 out of it.
    Contrast this with 75% which is referral fees. The referrel fees for $1 track might be 2-3 cents at max. Canonical wants to keep 75% of that and not 75% of $1 which comes to 75 cents.
    Please compare Apple to Apples

  6. “What worries me is that this is a continuation of a line of short-term corporate focused manipulations of the platform for UbuntuOne and against the Ubuntu user”.

    I don’t understand how the proposed arrangement would not be good for the user. It is good for the user in the following ways:

    * It adds choice to Banshee (providing another music store to get content from).
    * It adds a valuable service (downloading music to your Linux desktop is useful and fun).
    * It would generate revenue (…revenue that Canonical can invest in furthering Ubuntu’s feature-set and awareness).
    * It is all based on Free Software (I need no brackets to describe why this is good 🙂 ).

    “Just at a time when we so desperately need open markets. What we could do less with is Microsoft and Apple style platform manipulation; which in this case, removes revenue from a key software supplier”.

    This is entirely open: the Banshee license permits this kind of change, and I would agree this would be terrible if the money was going to some fat cats or away from the platform, but at this phase in Canonical’s history the money is most likely going to be invested back in the platform.

    In any case, it has been no secret that Canonical is a business and aims to generate revenue from Ubuntu, but to do so in a fair and reasonable and respectful manner, hence reaching out to the Banshee team…who are by the way, satisfied and happy with the discussions that happened.

    “We need more money going to the ecosystem and not to Canonical, because Canonical can’t be the only people to make money from Ubuntu. A healthy ecosystem requires many different and overlapping organizations, all able to make money from the platform”.

    Why not Canonical? Canonical is a huge investor in making the Ubuntu ecosystem happen. In any case, Canonical does not restrict who can make money with or from Ubuntu – see http://www.ubuntu.com/partners for an example of this.

    Again, I would agree if Canonical was siphoning off money to take it away from Ubuntu and the ecosystem and to restrict choice, but I don’t see either of those things happening at all.

    I am not asking you to agree or condone what happened, but I think your being a little harsh here, pal. 🙂

  7. Aside from anything else, it sets a bad precedent. They want paid software to appear in the software centre, are they planning on skimming 75% of the retail price there? How about other apps that generate small amounts of revenue like this?

    Apple charge 30%, Google charge 10%, Canonical charge 75% for access to a much much smaller number of users.

  8. This is a discussion about nothing. 75% of nothing. As long as the Banshee team decided to disable the store by default they (and Gnome) are out nothing. Current revenues remain the same and any discussion about what-could-have-been is like discussing vapor-ware.

    More importantly, Banshee passed on 25% of the revenues generated by their software being included in the most popular Linux distribution on the planet. A considerable amount I’m sure. Where’s the outrage about that? The poor innocent Gnome Foundation got screwed by idealist Banshee developers. Shame on them.

  9. I actually see it as a failure of both parts. Canonical has yet again managed to create another PR nightmare for themselves in the hacker community, Banshee developers have shown that FOSS projects don’t know what negotiations are.

    Unless we are missing part of the discussion I don’t see how couldn’t they try to negotiate better terms – Banshee is just another product, one that Canonical desperately needs – it’s so much better than rhythmbox that it’s not even funny. I can imagine them going for the 50/50 split and maybe getting something like 60/40. It wouldn’t be that bad assuming that Ubuntu really brings so many new users that it counts.

    Canonical really couldn’t do anything else now, that they have their own Music Store. We can argue that both this decision, and Canonical’s current revenue streams in the desktop product – Music Store, U1 – are not viable long-term solutions but Canonical may simply not be there to see the better world, if they can’t start making profits in the short term.

  10. I use Banshee, but I don’t use UbuntuOne.

    Firstly, the UbuntuOne store plugin for Banshee doesn’t work for me. I’m using the latest Banshee via PPA, but the store plugin only works with the stock version.

    Secondly, I use Dropbox instead of UbuntuOne’s file sharing/syncing, since it works a lot better. And in the end, I don’t really care about the the UbunutOne store being able to store my music.

    As for Canonical taking 75% of referral fees… well… Wouldn’t it be better if that was simply a default, and you could instead nominate who the referrals should go to?

  11. Good point, Martin.

    If Canonical begin consistently removing upstream’s revenue avenues (to coin a phrase) from default apps, upstream developers aren’t going to aspire to become Ubuntu default.

    But I also agree with Jono that that’s a very big “if” at this stage.

    And I trust sabdfl not to sacrifice Ubuntu’s prosperity for Canonical’s gain.

    I didn’t, until he told me that the Ubuntu One server remains non-Free only because in his judgement it’s not commercially viable to make it Franklin Street–Free. “I want us to be in the lead on this. If I thought that could include Franklin Street, we’d be there.” Whether he’s mistaken is irrelevant—it’s non-Free out of pragmatism rather than evilness.

  12. This is why I use Debian over Ubuntu.

    Debian is working on FreedomBox, Canonical/Ubuntu is working on UbuntuOne.

    Debian promoting the cause of freedom, Canonical/Ubuntu monetising its users.

  13. Also, this part of your post made me think of Debian:

    “a healthy ecosystem requires many different and overlapping organisations, all able to make money from the platform.”

    Lots of companies are making money from Debian (including Canonical/Ubuntu).

  14. foo,
    Correction… Canonical is losing money..and continues to lose money.

    -jef

  15. Jono,
    Can you get a firm commitment from Canonical to account transparently for the usage of the revenue that would have gone instead to the non-profit GNOME Foundation? Can Canonical commit to that and be willing to account for each and every penny in a transparent way with the Ubuntu community and show that the revenue was being used in ways the Ubuntu community would be okay with?

    Back when I was on the Fedora Board we had the opportunity to re-direct affiliate money from firefox search and part of the reason why we chose not to was because Red Hat as the managing entity that would receive the money couldn’t do so in a way that the Fedora Board (both Red Hat employees and not) felt was transparent enough with the Fedora contributor community. We did not want to rely entirely on asking the Fedora community to trust the money was going to be reallocated and used for Fedora community interests. We wanted a way for that to be verifiable. And it just wasn’t going to happen, not without a lot of financial related process re-plumbing (which would be more costly than the expected income) so we refrained from taking the opportunity to redirect revenue from Mozilla..even though we could have done it.

    You say that Canonical is “most likely” going to use the funds in ways supported by the community. Is “most likely” a good enough measure? Trust but verify… its not just a catchy Ronald Reagon era slogan it can and should be a very important part of competent transparent community governance. I would have thought you of all people would understand the need in communities for transparency and wouldn’t be encouraging people to just leave it at “most likely”.

    -jef

  16. I’ll actually simply echo Jono in this point. Any idea how much Canonical has invested in Ubuntu? Yeah, they deserve a few dollars. Is 75% a bit high? Perhaps, but it’s still not anything in the grand scheme of things.

  17. Many people like to contrast Ubuntu community against Canonical. But they forget one thing: Canonical is actually part of the Ubuntu community. In fact, Canonical is that part of Ubuntu community that has done the most for Ubuntu financially. If contribution = vote, Canonical can probably outvote the rest of the contributing community.
    What will keep Canonical honest?
    The knowledge that if Ubuntu is not great, there are many other distros and OSes out there. That’s incentive to make sure they invest sufficiently in Ubuntu.

  18. > I think we need a company with Canonical’s control to be thinking
    > about money in Ubuntu the ecosystem and not only to it’s own
    > business

    It seems to me that that’s exactly what their proposal would have achieved:

    As others have pointed out above, the inclusion of the Amazon MP3 store plug-in in the default installation would have been A) a win for users, because it adds choice, B) a win for the devs, because more users would enjoy their work (which seems to me the main purpose of GPL’d code), and C) a win for the Gnome Foundation, because it would have generated more referral bonuses. The only loser would have been Canonical, as the new store would presumably reduce the income from the Ubuntu One store.

    The proposal to take a cut from Amazon’s referral bonuses would have fixed this. The Gnome Foundation would still have a net win, if we presume that the installed base for the plug-in would at least be quadrupled by its default inclusion – sounds likely to me. It also sounds plausible to me that the 75% that Canonical was aiming for is only just what they’d need to balance the lost income from Ubuntu One.

    In short, the 75% cut only sounds outrageous if you forget the context. Canonical are probably best off by not including the plug-in, but they were seeking a way to do it anyway to the benefit of users, but without hurting their own bottom line – which would also be bad for users!

    Finally, I can somewhat sympathise with the sentiment that some have expressed, namely that Canonical didn’t write the code, etc etc. But in the end there are two fallacies in that line of thinking: one is that it’s based on a long-abandoned labour-theory of value, and the other is that it suggests only writing code adds value.

  19. @yungchin – I wouldn’t be too critical of the labour theory of cost, everyone from Aristotle through Carl Marx and even Keins didn’t rubbish the basic tenants of the idea that an object contains the value in proxy of the amount of labour put to it’s acquisition/creation. Although earning something for nothing has often been at the heart of the American dream, and just like a dream; you have to be asleep to believe it.

  20. Thanks doctormo. I think we agree on that – I’d never take the extreme position that there’s no value in labour at all. On the other hand, that Canonical are not entitled to exercise some control here because they didn’t develop the application, as some (not you) have argued, seems to me to presume the opposite extreme: that only direct labour holds value. Bringing a platform, a brand name, and a large audience to the table should also be valued.

    In the end, the whole issue reinforces my feeling that referral bonuses corrupt our good nature (I mean, I used to read bloggers’ product reviews and take them in good faith, but nowadays I should check for referral links and think twice…).

    P.S.: thanks for the wacom ppa, it’s incredibly useful!

  21. @yungchin – Canonical have a lot of power in the Ubuntu platform and part of their promise has always been to wield this power with wisdom and for the good of the platform. Many people said that it was impossible for a business to have such power and not try and abuse it. Over all Canonical have been more right than wrong, but I’d rather they weren’t wrong at all.

Comments are closed.