Jonathan Schwartz is the CEO of Sun, as well as a highly active blogger. His talk at Supernova 2008 is, as he noted, about the highly “exciting” topic of data centers. To open his talk he talked about what happens when the marginal cost of acquisition of new customers plummets to zero.

Then he shifted to the history of ZFS, a data system which is designed to handle massive data sets, which cost them hundreds of millions of dollars in research costs over many years and then in 2005 gave it away, full source code included, for free.

And then he talked about Thumper, a massive storage device which runs ZFS and which then went from zero to over $100M in revenue in two quarters.

He talked about how each registration adds a dot on a map, which in turn shows Sun where their customers are. The acquisition of MySQL adds 100,000 dots per day to the map, that’s 100,000 people downloading and registering MySQL each day.

Kevin Warbach and Jonathan Schwartz then had a further discussion about the economics of open source and whether with ZFS and mySQL and other products of Sun will have the same result as with JAVA where Sun has had some success but didn’t have some which other companies managed to have.

Kevin then shifted to a more general question about how to succeed in business. Jonathan talked about how a company like CNET or TechCrunch don’t, in fact, make money from their readers, they make money from their advertisers.

I asked Jonathan about how to decide what data to collect his answer was in two parts.

1. Collect everything that you can and keep it.

2. Be completely transparent.

Kevin and Jonathan finished the conversation with a great discussion about free business models ending with the note that coming soon are fully, truly free even physical objects. A phone without any contracts, consumer electronics you walk into Best Buy and get entirely for free. Supported by people running brilliant analytics showing them how to make money from the use of free products and software.