One of the interesting things that have come to my note is a
development of an open source Linux distribution called Cent OS.  Cent OS they say stands for Community
Enterprise Operating System and according to their website in www.centos.org they openly advertise
themselves as an Enterprise-class Linux Distribution derived from sources
freely provided to the public by a prominent North American Enterprise Linux
vendor.  CentOS they say, conforms fully with the upstream vendors
redistribution policy and aims to be 100% binary compatible. (CentOS mainly
changes packages to remove upstream vendor branding and artwork.).

If you go further and look towards the many articles and
blogs, you will easily find out that the North American Enterprise Linux vendor
which they don’t name is actually Red Hat Enterprise Linux.  In short, they are saying, that they are
fully 100%  binary compatible with Red
Hat, is everything Red Hat is and the only thing that is not there is RedHat’s name and logo, plus of
course, they don’t charge what Red Hat does.

Now obviously, this company is actually trying to benefit
from a lot from Red Hat.  What can Red
Hat do?  It seems they cannot do
anything.  As they have been able to
create a business based on open source, it seems that other companies may be
able to benefit the same from their work as it is based on the GPL license on
which open source is based.

Can you imagine if you are a perfume or bag
manufacturer?  You create a perfume, and
somebody copies your formula, and then sells or gives away the product for
free?  What would happen to your business?  Or let us say you are Rolex watch.  Because you are based on open source,
somebody can copy exactly your watch as it is, takes out your name, and logo,
and sell it 10 times cheaper.  If it is
legal, where would that put your business?

 
This could be one of the challenges that you could face if
you are planning to launch a business based on open source.  I would like to get your opinions on this.

Related Posts:
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-Business Model for Open Source
-Paying Open Source Developers