But OEMs have also noticed some new trends. Customers aren't ordering
extra Microsoft software such as Microsoft Office 2007 Professional,
with their PCs. Customers are ordering a more "minimal" version of
Office, or no Office at all. It seems that many PC buyers have
decided that OpenOffice or StarOffice is "good enough" to meet their
needs.
Microsoft now has to compare last year's "Vista boosted" numbers, to
this year's "cautious market" numbers. The same is true with the PC
makers. Meanwhile, pure PC companies like Gateway have been swallowed
whole by ACER, which is not a public NASDAQ listed company.
Meanwhile, Apple is blowing the roof off their previous year's sales.
They have released Leopard, even though they were already selling Macs
as fast as they could make them.
How long before OEMS decide they've had enough of being in a commodity
market where the prices crash, because Microsoft will not let them
offer value-added functionality, such as Linux, Open Source Software,
and 3rd party applications as preinstalled options.
> Related:
> Linux Says Bye-bye Windows XP!
> ,----[ Quote ]
> | It's been one of those months! My computer crashed taking with it crucial
> | XP system files. This is the 3rd crash in the last year and I've finally
> | had enough with the Windows operating system!
I just had a similar experience with my only XP system. At this
point, I'm seriously tempted to install Linux as the primary OS and
make Windows XP a Virtual client on even that PC.
> http://www.richtam123.com/wp/?p=20
> Windows Vista, The best thing that ever happened to Linux?
> ,----[ Quote ]
> | Millions of these units have been ordered by Countries such as
> | Nigeria and Libya and pretty soon there will be millions of
> | children around the world with Linux as their first operating
> | system.
OLPC has been getting a lot of press, but Linux has been driving a
huge distribution of low-cost computers to millions of children and
people in Africa, Asia, India, Central America, and South America, for
over 10 years now. Red Hat helps one NGO configure nearly 10 million
"recycled" computers with Linux every year. I don't know if Novell
and Ubuntu have similar "recycle" initiatives or not. Sure, some of
these computers are now 15 years old, and run 400 mhz pentiums with 64
megabytes of memory, but when they are running Linux, with "economy"
configurations, they are still very useful machines that perform quite
reliably.
> | In stark contrast Microsoft have just released Windows Vista,
> | probably the most resource hungry Operating System ever, for
> | the PC platform.
Some of this is understandable. Remember, Microsoft's biggest
customers are Original Equipment Manufacturers. Microsoft has to
convince these OEMs that the new operating system will generate huge
sales volumes, at premium level prices, at least 3 times the price and
twice the volumes of the now stale predecessor.
Some versions of Windows have met these objectives, some didn't.
Windows 95 produced robust sales of new machines, partly because it
wasn't practical to install Windows 95 on older machines, especially
VLB, MCI, and EISA machines.
Windows NT 4.0 generated a nice boost in corporate desktop and laptop
orders. Once service pack 3 was released, and it became official that
you needed 64 megabytes of RAM, not the 16 megabytes originally
claimed, sales picked up and many corporate customers ordered
corporate licenses and support contracts which also guaranteed that
they would get Windows NT 5.0 (now called Windows 2000), at no
additional cost.
With Windows XP, Microsoft tried to "force feed" the channel, and
triple their support prices, less than 1 year after the much delayed
delivery of Windows 2000. Many companies canceled their support plan,
and stuck with Windows 2000. Others planned strategies to switch to
Linux, and used that threat to get lower license/support rates from
Microsoft. The OEMs eventually started just shipping Windows XP
Professional, rather than try to support and pay extra for upgrades.
Even at OEM prices, the upgrades could double the price of an OEM
Windows XP license.
Windows NT 3.1 not only didn't generate new sales, but even had people
"holding off" purchases until "Chicago" was finally released. It was
a real problem for the industry. From 1993 to 1996, growth wasn't
good, and OEMs were beginning to look at Warp, UnixWare, Linux, and
Solaris for alternatives to Microsoft's aging Windows 3.1 operating
system.
Windows 98 did generate sales, largely because people liked USB 1.1
capabilities. The problem is that prices didn't hold. PC prices
dropped rapidly, and because Windows 98 was such a commodity, price
wars and overproduction, combined with a huge "White Box" market
oriented toward Linux, had caused PC prices to drop very quickly.
Windows 2000 was the best operating system Microsoft has ever
produced. It was very stable, very durable, and relatively easy to
manage. It was also very efficient, working well on even 600 Mhz
laptops with 64 megabytes of RAM, and even 20 gigabyte drives.
Unfortunately, it didn't generate much revenue for Microsoft, because
they had already promised free upgrades to corporate customers who
were paying for support. It also didn't generate much revenue for
OEMS, since most laptop and desktop machines could easily be upgraded.
Ironically, Windows 2003 server almost backfired. Microsoft kept
threatening to cancel support for Windows NT 4.0 server, but each time
they actually attempted to pull the plug, they found that customers
were not upgrading to Windows 2003, they were converting many
applications from Windows NT 4.0 to Linux. This was especially easy
with databases such as DB2 and Oracle. It was also easy with Java
based applications such as WebSphere, WebLogic, and SunONE.
Often, only a portion of the NT 4.0 servers were converted to Windows
2003, and most of those were gateway servers such as IIS servers.
Microsoft even had a problem with corporations, since Microsoft didn't
support most of the industry standard protocols used by the Enterprise
Linux, Unix, and Mainframe servers. Microsoft introduced .NET as a
way to integrate using SOAP transactions to interface between Windows
and these "Back end" servers.
Ironically, Linux and UNIX were so efficient and scalable, and Windows
2003 was so inefficient, that Linux and UNIX servers got faster,
smaller, cheaper, and more powerful, while Windows 2003 servers tended
to give pretty much the same performance, even when hardware got
faster and more powerful. The result was that Windows 2003 had higher
server counts, even though each server did less work. In the short
term, it gave Microsoft additional revenue, especially for server
upgrades. In the long term, more and more new server projects were
implemented on LInux or UNIX, rather than Windows 2003.
> http://www.otezz.net/windows-vista-the-best-thing-that-ever-happened-...
> Linux gains despite and because of Microsoft
> ,----[ Quote ]
> | Despite the heightened competition over the last two quarters from
> | Microsoft-Novell and a move by Oracle to undercut Red Hat on the cost of Red
> | Hat Linux support service, Red Hat has reported double-digit growth in
> | revenue and an increase in profit.
Interesting bit here. Oracle reccomends Red Hat, they also use Red
Hat as secondary support, but they offer management tools that help
optimize the integration between the database and the operating
system, especially when it comes to doing root cause analysis and
performance analysis to assure a stable, high-performance system.
Other companies, including IBM, Dell, and HP also provide their own
support, but pay a portion of that to Red Hat, who provides Level 2
and Level 3 services.
Many of the common questions, the Level 1 issues, can be handled by
the internal support organization, and are often better handled by the
same team that provides support for the applications, networks, and
other general support. This team is often an outsourcing team.
When there are severe issues, that can't be resolved using the
standard tools and diagnostics, the higher level service can be
handled by the "Experts" in that particular operating system,
application, or middleware.
> | "The success of Red Hat has been able to validate the future potential for
> | open source software," Szulik says.
This is very true. Red Hat has generated huge markets, and has found
ways to make these markets profitable. They have a solid revenue
growth, good profit margins (excluding growth oriented R&D and
investments), and have achieved a reputation as a very reliable and
trusted vendor. This is especially true in the server market.
> | Emerging countries are also lucrative markets for Linux, says IDC's Gillen,
> | because there isn't as much of the legacy Windows technology to have to
> | displace.
In many cases, it's just the opposite. In many emerging markets,
Linux is the entrenched technology, and it is Microsoft who has a hard
time establishing a foot-hold in these markets. Microsoft ignored
most of these markets when Red Hat was seeding them, because there
wasn't enough real revenue in it. Then, when these emerging markets
started experiencing double-digit economic growth, the market had
already been generated using Linux. Microsoft often had to confront
markets who percieved Windows and Microsoft applications as a drag on
productivity.
> http://www.linuxworld.com/news/2007/072507-linux-microsoft-gains.html...
> | Windows Vista is a step back in usability, researcher claims
> http://www.macworld.co.uk/news/index.cfm?RSS&newsID=17334
Rex Ballard
http://www.open4success.org
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