In comp.os.linux.advocacy, Rex Ballard
<rex.ballard@xxxxxxxxx>
wrote
on Fri, 31 Aug 2007 08:47:30 -0700
<1188575250.178320.236820@xxxxxxxxxxxxxxxxxxxxxxxxxxxx>:
> On Aug 30, 5:28 pm, The Ghost In The Machine
> <ew...@xxxxxxxxxxxxxxxxxxxxxxx> wrote:
>
> The Paragraph below merits it's own topic.
>
>> The scary thing is: Windows *is* working. Not in the
>> technical sense of actually accomplishing something that
>> the user actually wants, of course, but in the sense
>> that Microsoft is getting billions of dollars of revenue
>> yearly thereby.
>
> This is correct. Microsoft has been very effective at
> achieving profit margins normally only found in organized
> crime, such as illegal drugs, prostitution, and illegal
> gambling.
One of the advantages of software distribution is the
very low manufacturing costs (as opposed to very high
development costs, or non-recurring engineering (NRE)
costs). The Internet makes distribution even cheaper,
since 1 GB of data might cost about 10 cents retail, and
even less wholesale...I'd have to look up OD-768 rates,
but the calculation for a 150 KB/s data line works out
to about 3888 gigabytes per month capability -- for about
$40 in my case, and cheaper plans might be available.
It's not free, but it's certainly very inexpensive.
>
> To be fair, Microsoft did make computers cheap,
> and they made them much easier to use.
Indirectly, perhaps, in the first case.
> From
> Windows 3.1 on, users have been able to use
> Windows, along with most Microsoft applications,
> without having to purchase manuals or instruction books.
>
> Often, the full value and capabilites of the product
> still require the 1100 page book, but people can
> APPEAR to know what they are doing without
> spending hours staring at manuals - they just
> use the online helps.
>
> The real question becomes; "at what point
> did Microsoft extract excessive profits by
> abusing monopoly control over the OEM
> channel?".
Probably when they ran that "discount-per-box" (as opposed
to "price-per-install") licensing contract. ISTR that
that started about the same time Win95 was released,
especially since Win3.1 was installable, whereas Win95 was
preinstalled in many cases.
>
>> and making oodles of profits by siphoning
>> off revenue from, among others, OEMs,
>
> Microsoft has been able to get away with "All Or Nothing"
> terms for almost 25 years. Originally it was called
> "per processor" or "per PC" licensing. When federal
> court judges ruled that this was illegal, Microsoft offered
> a settlement which allowed them to use "cliff tiered pricing"
>
> Let's say the OEM produces 10 million PCs/year.
> Microsoft's price structure would look something like this.
>
> Quantity Price/Unit Total Cost
> 6 million $60 $360 million
> 8 million $50 $400 million
> 12 million $30 $360 million
>
> The OEM obviously wants the discount, but there is a catch.
> Microsoft provides a "Standard Image" to be installed on all machines.
> Any alteration of that "Standard Image" must be approved by Microsoft.
> Most alterations, such as adding new drivers - take a few days to get
> approved.
> Alterations such as partitions, boot managers, or other changes to
> facilitate Linux
> or other competitor offerings - can be delayed for 18-24 months. By
> then,
> the hardware mentioned in the approval, is already obsolete.
>
> There's no "smoking gun" - with Microsoft telling a manufacturer that
> they
> will not be allowed to install changes that would facilitate Linux.
> They just
> require prior written approval and such requests seem to go to the guy
> who's in-box is never emptied, and the requests stay at the bottom of
> the pile.
>
>> and of course
>> those who go out and purchase Vista in that pretty box.
>
> The "pretty box" buyers is actually a very small percentage of the
> total
> market.
It won't be for long, if Microsoft has its way.
Presumably, Microsoft will want *all* new machines to go
out with some Vista edition. The market is fighting this,
admittedly, but it's a losing battle, especially if Vista
SP1 is any good and the driver kinks get ironed out.
> Less than 1% of all Windows licenses are sold directly to end-
> users.
> Even those that are purchased are often purchased to install Windows
> onto
> a hard drive that has been damaged or corrupted beyond recoverability.
>
> Many OEMs do not provide installation media, and even those who do
> often
> charge as much as $50 for the installation media, which must be
> purchased
> via telephone, and which cannot be used on any other PC.
Not sure about that, though I'm also not sure what Dell
ships with a Vista unit (or, for that matter, an XP unit).
Dell offers an installation disk but it might be a simple
image rescue -- *splat* it's "fixed" but one's data is gone.
>
>> (The issue is exacerbated by their interesting decisions to
>> eliminate certain functionality from the lower Editions,
>> which means the user might have to upgrade to Ultimate to
>> get that functionality. Gaah!)
>
> This has become a very serious problem for Microsoft.
> Most customers would be very happy to get Windows Home Basic,
> which doesn't need as much memory and resources, and run it
> as a VM client, to either Linux or XP. They would be able to
> purchase or license MP3 players, DVD players, and other
> multimedia technology from 3rd parties.
>
> Microsoft's hardline stance has effectively Vista undesirable
> to corporations who provide laptops to employees. After all,
> if these employees use Napster or iTunes, without upgrading
> to Ultimate, they would be in violation of the Microsoft EULA.
> As a result, businesses would rather stay with XP Professional.
>
>> Even if the user later installs Linux on an OEM's computer,
>> Windows wins in most cases, unless the user carefully picks
>> the box.
>
> Even when the box is "Linux Ready", having the OEM license
> for Windows XP makes it possible to run Windows Virtually.
It is also possible (albeit not legal, if one believes
the EULA) to run Vista virtually, presumably. However,
I'd have to research the issue, and I'm not sure how
many emulators support simulated 3-D hardware yet.
>
>> This is hopefully changing (Dell in particular is offering
>> Ubuntu-preloaded PCs in addition to their FreeDOS
>> offerings) but I for one would not call this a level
>> playing field.
>
> HP, Dell, IBM (now Lenovo), and Acer have been offering
> "Linux Ready" machines for quite a while now. Most ThinkPads
> were "Linux Ready" as early as 1998.
Linux ready is one thing; Linux preinstalled quite another.
It is possible to be Linux ready with a Microsoft Windows
license -- all of my machines had Microsoft software at one
point or another running thereon, and most of them still have
a copy of Windows (my Athlon and my Pentium III 400 MHz
server box being notable exceptions).
>
> IBM has stated in federal court that they wanted to offer alternatives
> to Windows. In 1995, they wanted to offer Warp 4.0. Microsoft
> had threatened to revoke the "Microsoft Authorized Dealer" status
> of any retailer who carried the Warp powered ThinkPads.
Absent something in the RICO or Sherman Antitrust statutes
(I'd frankly have to look), I'm not sure Microsoft doesn't
have that right. I don't consider it fair to the consumer,
of course.
>
>> Dell is also hedging their bets -- a possible necessity
>> given their preexisting contracts.
>
> Most of the OEMs have been watching the trends for the last 5 years.
> Customers are purchasing "Linux Ready" machines. They are purchasing
> them with Windows. Machines that are "Linux Hostile" do not sell as
> well
> as expected, and the OEMs end up having to drastically reduce prices
> to
> reduce their inventory.
Cite? I'm curious as to the details here.
>
> Rex Ballard
> http://www.open4success.org/bio
>
--
#191, ewill3@xxxxxxxxxxxxx
Linux. An OS which actually, unlike certain other offerings, works.
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