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Re: [News] Ubuntu GNU/Linux on Sub-notebooks a headache to naive consumers.

Ezekiel wrote:
> Doctor Smith (flatfish) wrote...
>> ...who unwittingly purchase the Linux and then discover when
>> they get home that they might as well have purchased a
>> brick. So back to the store it goes to get exchanged for a
>> Windows model.
> In short that's pretty much what happens. Even Ubuntu
> (Canonical) admits this:
> <quote> Well, when we touched base today with Gerry Carr,
> marketing manager at Canonical (the creator of the Ubuntu
> operating system) we learned that MS's research extends beyond
> its own products. See his comments below, but it seems Linux's
> future on the netbook is bleaker than we thought.
> We don't know what the XP return rates are. But I will say
> that the return rate is above normal for netbooks that offer
> open-source operating systems, Carr echoed. Carr highlighted a
> few reasons why Ubuntu-running netbooks are returned more
> often. Unclear selling is happening, typically online. The
> customer will get their netbook sent to their home and they 
> imagine to find something like a Microsoft desktop, but they
> see a brown Ubuntu version. They are unwilling to learn it and
> they were expecting to have Windows. </quote>
> http://www.forevergeek.com/2008/10/is_linux_losing_ground_in_the_netbook_market/

The Cold Numbers of Microsoft’s Netbook/Linux Nightmare
February 12th, 2009

So what’s the effect on the bottom line?

Software is a great business model because selling an additional
copy of software doesn’t have a significant cost. Almost all the
revenue from each incremental sale goes straight to the bottom
line. But the reverse is true as well. The lost revenue from the
4.2 million Netbooks not running Windows evaporated right out of
Microsoft’s profit. Microsoft does not reveal the price paid by
manufacturers for its old Windows XP, but it’s estimated to be
less than $20 by Endpoint Technology Associates.

Some rough back-of-a-napkin calculations:

4.2 million lost sales x $18 price per copy = $75,600,000

Due to deteriorating profit margins, Microsoft recently announced
a huge lay-off of 5,000 jobs. Lets assume that each developer has
a total cost (salary, benefits, social security, etc.) of $150,000.

$75,600,000  / $150,000 per employee = ~500 developers.

Developers are the lifeblood of a software company. Microsoft’s
ability to deliver innovative products is being stung by Linux in
the netbook market. Unless Microsoft 7 is a hit, this trend will
accelerate. Unfortunately for MSFT, Windows 7’s is based off of
Vista and its cheapest version will limit users to running 3
programs at a time.


or http://tinyurl.com/bb94re


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