CASE STUDIES: East-Southern Africa FLOSS Business Models

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S. K. Sowe. UNU-MERIT: Module 2: African FLOSS Business Models Case Studies

Module 2: African FLOSS Business Models Case Studies

for ict@innovation, FOSSFA/InWEnt

Version / Date: 14 - 25 September, 2009

University of Dar es Salaam

Dar es Salaam, Republic of Tanzania

Sulayman K. Sowe[[email protected]]

Provided under a Creative Commons Attribution-Share Alike 3.0 Germany License / Copyright: FOSSFA & InWEnt

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The learning objectives for Module 2 are as follows:1. To understand the various services and solutions offered by ICT-Based SMEs in

Africa.2. To know the types of FLOSS clientele and how their issues can be addressed in

the Africa context.3. To see the advantages and challenges FLOSS can present to clients and start-

up businesses.4. To understand barriers of entry into FLOSS business in Africa.5. To know some profitable service sectors.6. To understand the importance of networking with FLOSS strategic partners and

communities.7. To understand what the FLOSS business risks are and how to mitigate them.8. To identify African companies using FLOSS business models in their business.

TOC

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Building African FLOSS business models

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• Exploratory study of companies online• Introductory email of intent to participate• Email set of questions (See “template“, page 32)

• Outlook and Experience report• Revenue generation• Service line and FLOSS motivation• Lessons learnt....will this work for me?

• Follow-ups• Compile cases

– Discuss and refine cases– Add relevant cases to broaden scope

Case Studies Methodology

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OpenWorld Ltd.

GIS GlobalImage (PTY) Ltd.

Future Soft Resources Nigeria Ltd.

Linux Holding (PTY) Ltd.

Linux Solutions Ltd.

Amest Santim Systems PLC Ltd.

CENFOSS Ltd.

Geographical Distribution of Module 2 Case Studies

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List 2 ICT-Based SMEs doing business in FLOSS solutions

and Services• Country...........................• Company........................ • Website...........................

TASK 1

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• Background– Since 2004, Employs 7– Setup through personal initiative

• Business Focus– Consultancy & Training, – Software Development & Support

• Lessons learnt– Regular workshops & Invited talks, – try the untested & do things differently

Module 2.1:- OpenWorld - Kenya

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• Background– Since 2000, Employs 17 (5 are directors)– Merger of 2/more other companies

• Business Focus – GIS Software Development, Sales, distribution and Support,– Hybrid FOSS business model

• Lessons learnt– Partnership with companies and educational Institutions,– Build profile online, Network, workshops, Invited talks, – Customize GUI only. – Forecasts

» move to web-based solutions» Other markets, eg mobile

Module 2.2:- GIS GlobalImage – South Africa

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• Background– Established since 1998 but only active in 2008– Employs 5, partners in UK/USA

• Business Focus– Web-design and hosting– E-commerce, Ads

• Lessons learnt– Family & friends can start a business, FLOSS to keep cost down– Outsourcing, consulting,– Get FLOSS person in company– Involve FLOSS communities– Donate when you can

Module 2.3:- Future Software Resources Nigeria Ltd.

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• Background– Since 2003, Employs 9– Setup through personal initiative

• Business Focus– Linux-based training (LPI approved)

• Individuals and Companies in South/Eastern African

• Lessons learnt– Surveys to gather customer & training needs– Strategic plan; expanding incrementally– Need to know

• Local market, business laws• Look at what others are doing

– Offer quality service– FLOSS is 'free' but services NOT

Module 2.4:- Linux Holding – South Africa

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• Background– Since 2000, Employs 10 (3 FLOSS experts)– FLOSS Business & Advocacy

• Business Focus– Tech support, Consultancy, Software development, Networking– Hardware sales (GNU/Linux pre-installed)

• Lessons learnt– Advocacy agend works, Educate your clients– Your business cant survive on FLOSS alone! Diversify! diversify!– Problems with start-up capital. Private sectors as an option– Governments & contracts/bids

• Biggest customer, poor paying habits• Consider private sector – more focused? good paying habits?

– Does it work for me? Localization!!! think 2wise

Module 2.5:- Linux Solutions - Uganda

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• Background– Since 2005, Employs 5– FLOSS business at home!!!

• Business Focus– Software Development, training– Web-design/hosting, domain registration– Maintenance & consultancy

• Lessons learnt– Minimal start-up cost (2000ETB~200$)– Products & services you are good at– Tailoring product to client needs (consult and discuss)– Creativity, flexibility, creativity– Go for bids with “big boys“ - lessons to be learnt, be bold.

Module 2.6:- Amest Santim Systems- Ethiopia

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• Background– Since 2006, Employs 12– 1st come - 1st have

• Business Focus– Server configuration, software Development – Domain registration, network monitoring– Training & Support

• Lessons learnt– Main if not only FLOSS training and solution provider– Less or no competition– Big customers– Government, private sector, NGOs, Univ. Telecom, Banks– External FLOSS partners (CodeWeaver, Wine)

Module 2.7:- CENFOSS - Mozambique

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Q&A

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• Group work– For each case study, discuss and list

1.FLOSS Business Strengths

2.FLOSS Business Weaknesses

3.Opportunities for your FLOSS Business Strategy

4.Room for Improvements

TASK 2

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Taxonomy of FLOSS Business Models

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Taxonomy of AfricanAfrican FLOSS Business Models

Company SS INS INT TCERT LCERT TR MASC MION

OpenWorld Yes Yes Yes NA NA Yes Yes NA

Global Image Ltd Yes Yes Yes NA NA Yes Yes Yes

Future Software Resources Yes Yes NA NA NA Yes NA NA

Linux Holdings NA Yes NA NA NA Yes NA NA

Linux Solutions NA Yes NA NA NA Yes Yes NA

Amest Santim Systems PLC Yes Yes Yes NA NA Yes Yes Yes

CENFOSS Yes Yes Yes NA NA Yes Yes Yes

Percentage in module 71.45% 100% 57.1% 0% 0% 100% 71.4% 42.8%

SS = Software Selection, INS= Installation, INT= Integration, TCERT= Technical Certification,

LCERT= Legal Certification, TR= Training, MASC= Maintenance and Support Contracts,

MION= Migration from old to new systems

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Discussion

What is your FLOSS Business?

TASK 3

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• FLOSS packaging• FOSSCDs (www.fosscds.co.za) forge business.• Pack schema....vs freedom toasters, check opencafe.

• FLOSS marketing• Build a FLOSS repo of goods and services • FLOSS companies can use and benefit from incubator

• Others• Provide FLOSS documentation• FLOSS Strategic management, • Policy advise, legacy issues for start-up companies• Mobile tech & • Data archiving, storage• Data processing

– Accounting, survey, tax and census data analysis

“New“ African Business Models

http://www.fosscds.co.za/

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WHAT IS YOUR FLOSS BUSINESS MODEL?

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About ict@innovationThe ict@innovation programme builds capacities in African small and medium ICT enterprises to make a business with Free and Open Source Software (FOSS). ict@innovation aims to encourage the growth of African ICT industries, particularly in Southern and East Africa, through three main actions: spreading FOSS business models for enterprises in Africa, fostering FOSS certification and supporting innovative local FOSS applications for social and economic development. ict@innovation is a partnership of FOSSFA (Free Software and Open Source Foundation for Africa) and InWEnt - Capacity Building International (Germany). The programme focuses on Free and Open Source Software (FOSS) as a key technology to drive innovation, add local value and create sustainable and affordable ICT-solutions. With financial support by: the German Federal Ministry for Economic Cooperation and Development (BMZ) and the Open Society Initiative for Southern Africa (OSISA). License: Creative Commons Attribution-Share Alike 3.0 GermanyCopyright for this version: FOSSFA & InWEnt About the Creative Commons Attribution-Share Alike 3.0 Germany License: You are free to copy, distribute, transmit and adapt the work under the following conditions: 1) Attribution: You must attribute the work in the manner specified by the author or licensor (but not in any way that suggests that they endorse you or your use of the work). 2) Share Alike. If you alter, transform, or build upon this work, you may distribute the resulting work only under the same, similar or a compatible license. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/de/deed.en or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.

Please note that this license requires attribution of all authors in future versions, and should include the following attribution: "Created during the initiative "ict@innovation - Creating Business and Learning Opportunities with Free and Open Source Software in Africa", a programme of FOSSFA and InWEnt – Capacity Building International, Germany For more information see www.ict-innovation.org. Reference number : 1702900100. / Under the license, the copyright holder (FOSSFA & InWEnt) do not endorse any previous or future versions of the material or the use of the work."

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CASE STUDIES: East-Southern Africa FLOSS Business Models