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Comes: Microsoft Manipulats the Prices at OEMs to Harm GNU/Linux Sales

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    From: Date Watanabe
    Sent: Thursday, June 26, 2003 3:59 PM
    To: Rick Wong; Rob Young (OEM)
    Cc: Kurt Kolb
    Subject: FW: LDS Church - Hewlett Packard
    Attachments: RE: LDS - Open Source - Quick Update; RE: LDS - Open Source -
Quick Update

    I took this offline with our guy, Brad, but I think we should be concerned
that they are breaking out the OS separately.

    Dale

    From: Dale Watanabe
    Sent: Thursday, June 26, 2003 12:09 PHM
    To: Brad Beadles
    C¢: Bret Arsenault; Scott Johnson (DENVER); Tim Schmidt (DENVER); David
Brandt (DENVER); Ann Nicholson
    Subject: RE: LDS Church - Hewlett:t Packard

    Brad,
    1.. OEMs should NOT be quoting separate prices for OEM versions of OS and
applications. If they are, they are violating their licensing agreement with
us.
    2, Given the fact that the prices that you quote from the OEM are no where
near their true price from us, then the above is probably not a really issue,
but the end user customer perception ends up getting skewed.
    3. OEM OS prices are uniform based on volume, Anyone can figure out from
IDC data, etc. that HP’s and Dell’s volume are virtually the same. We do not
have any flexibility to change prices on a deal basis. But I don’t think that
is the real issue here.

    Please give me a call. Rather talk through this with you.

    Dale
    425- 706-8 796
    Cell: 206-953-2233

    From: Brad Beadles
    Sent: Tuesday, June 24, 2003 4:31 PM
    To: Dale Watanabe
    Co: Bret Arsenault; Scott Johnson (DENVER); Tim Schmidt (DENVER); David
Brandt (DENVER); Ann Nicholson
    Subject: LDS Church - Hewlett Packard
    Importance: High

    Hi Dale,

    Bret asked me to ping you with a competitive situation we are having with
The LDS Church here in SLC. To net it out, HP and Dolt are their PC providers
of choice. The Church has asked them to come back with systems that are under
$500 for their local area offices and units around the world. This constitutes
approximately 25,000 PC’s.

    Outside of the hardware they are considering alternatives to their current
standard of Windows O/S and MS Works on the desktop in these local units. They
are considering Mandrake,

    MS-CC-RN 000000784853
    HIGHLY CONFIDENTIAL

    Debian, Red Hat and Open Office because of their upfront costs. HP is
quoting their system to include both the Windows O/S ($80) and MS Works ($15)
for an overall software acquisition cost of $95 for the O/S and Application
Suite The Open Source alternatives are $8.50 for the O/S of choice which is
currently Madrake (Open Office is $0.00). As you can see, we have a price
delta of $85 between the MS solution and the Open Source solution.

    Is there anything we can do with/for HP to lower the O/S cost to become
more competitive? Dell is quoting $30 for the O/S and the MS Works product
team is giving us $25 for MS Works for a price point of $55 for the Dell
software acquisition costs.

    Regards,

    Brad D. Beadles
    Microsoft Corporation
    801.257.6400

    Utah Events and Information
    htttp://microsoft.com/usa/offices/saltake.asp

    3/10/2005

    MS-CC-RN 000000784854
    HIGHLY CONFIDENTIAL

______
Exhibit px08618
PDF: http://boycottnovell.com/wp-content/uploads/2009/01/px08618.pdf
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