September 27, 2012 AT 9:41 am

OHS 2012 Kicks Off In NYC

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The Open Hardware Summit opens with a keynote talk by Chris Anderson, editor of Wired magazine, who is himself the head of an Open Hardware company as well as a writer and thinker about the movement. He encourages those gathered to look to the next stage of evolving the Open Hardware movement, and avoid doctrinarian fighting over the notion of what Open Hardware might be. He explores what it means to have an Open Hardware business model, in practical terms.

Special shout-out to Adafruit for being involved in identifying, early on, the 2.6x BOM multiplier that has guided how the DIY world prices products.

Keep ahead of donors by innovating faster, supporting better. You can clone us but you can’t clone the community. Community beats cloning every time.

And an interesting rule of thumb for how DIY manufacturers might behave vs large industrial manufacturers.

“90-10″ Rule: 90% the performance of commercial options at 10% of the cost.

Particularly exciting to me was his Hierarchy of Reward pyramid, that points out the rewards his Open Hardware company is able to provide to give contributors something valuable to them without raising cost of products.

He also addresses the MakerBot question and cautions that we shouldn’t be dogmatic about Open Hardware but instead reward the mix of strategies that works, builds a sustainable business, and provides the community what it needs. He argues that Open Hardware business practices will be embraced because they work and make solid business sense.

His list of the seven limitations of OSH Limitations:
1. Cloning is Unstoppable.
2. Investors Aren’t Sure. (Want to see the barriers to commercial copying. His recommendation to consider: Open Software, Closed Hardware.)
3. It’s Hard to Keep Up.
4. It Doesn’t Extend Much Beyond Electronics and Lasercut Materials.
5. It Can Confuse the Marketplace.
6. It Tends to Drive Prices Down, Punishing Innovators Most.
7. Unlike Software, Mechanisms for “Giving Back” Are Not in Place. (Think GitHub for hardware.)

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2 Comments

  1. Where can we read more about the 2.6x BOM multiplier? I can only recall a recommendation for dual ~ 40% markups for COGS to assembled product and again to retail. Thanks.

  2. Gertie, see o.a. this article: http://www.adafruit.com/blog/2011/01/05/%E2%80%9Cten-rules-for-maker-businesses%E2%80%9D-by-wired-diy-drones-chris-anderson-chris-anderson/

    The 2.6 comes from 60% for yourself and 60% for your reseller.

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