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thing 09-05-2004 01:31 AM

Microsoft: Linux is a threat, it may mean prices cuts and less businessfor us
 
September 03 2004
by Jo Best
"Filing shows just how much open source is worrying Redmond.

Microsoft has filed a report with the Securities and Exchange Commission
(SEC) - and it looks like the Redmond giant could be in for a lean year
ahead, even going as far as to hint that Linux and other open-source
rivals might be to blame........"

I like SEC filings, no matter how much fantasy a company has in a press
release, lye to the SEC and your in doggy do do past your eye balls.....

http://software.silicon.com/os/0,390...9123685,00.htm

regards

Thing


Divine 09-05-2004 03:12 AM

Re: Microsoft: Linux is a threat, it may mean prices cuts and less business for us
 
On Sun, 05 Sep 2004 13:31:44 +1200, thing wrote:

> Microsoft has filed a report with the Securities and Exchange Commission
> (SEC) - and it looks like the Redmond giant could be in for a lean year
> ahead, even going as far as to hint that Linux and other open-source
> rivals might be to blame........"
>
> I like SEC filings, no matter how much fantasy a company has in a press
> release, lye to the SEC and your in doggy do do past your eye balls.....
>
> http://software.silicon.com/os/0,390...9123685,00.htm


Interesting article. Thanks for posting it.


Divine

--
"Even the most fanatical Microsoft supporter has to see that Longhorn has
become Shorthorn."


thing 09-05-2004 03:42 AM

Re: Microsoft: Linux is a threat, it may mean prices cuts and lessbusiness for us
 
Divine wrote:
> On Sun, 05 Sep 2004 13:31:44 +1200, thing wrote:
>
>
>>Microsoft has filed a report with the Securities and Exchange Commission
>>(SEC) - and it looks like the Redmond giant could be in for a lean year
>>ahead, even going as far as to hint that Linux and other open-source
>>rivals might be to blame........"
>>
>>I like SEC filings, no matter how much fantasy a company has in a press
>>release, lye to the SEC and your in doggy do do past your eye balls.....
>>
>>http://software.silicon.com/os/0,390...9123685,00.htm

>
>
> Interesting article. Thanks for posting it.
>
>
> Divine
>


There have been a few around the same vain. At present the share market
loves MS for its returns and/or capital gains, however there are
"intersting" pieces like this coming out, one wonders for how long MS
will be wall street's darling.

regards

Thing


Cheetah 09-05-2004 04:02 AM

Re: Microsoft: Linux is a threat, it may mean prices cuts and less business for us
 
thing wrote:

> Microsoft has filed a report with the Securities and Exchange Commission
> (SEC) - and it looks like the Redmond giant could be in for a lean year
> ahead, even going as far as to hint that Linux and other open-source
> rivals might be to blame........"


How has Linux affected Microsoft? I don't think it has really hit Microsoft
in terms of Desktop units - since Linux accounts for under four percent -
probably less in terms of desktop machines. In terms of servers Linux may
be much more successfull, but is not pushing Windows out of that market.

However, what is telling is that Microsoft have been lowering the price of
Windows to ensure that Linux doesn't get traction. Linux has already made
MS pull up their socks when it comes to stability, and MS is still trying
to address security. If nothing else Linux is valuable for the positive
effect it had on Windows.

Microsoft makes most of its dollars from Windows and Office. The operating
system is fast becoming a commodity - as is office productivity software.
They have also recently committed to giving cash to shareholders - so its
huge cash reserves won't be quite so big.

However, while it is encouraging to see that true competition is benefitting
the consumer, I don't think Microsoft will be going anywhere soon. And
either would I wish it... I think perhaps that in the medium to long term
we will simply see Microsoft return to providing real value and competing
on merit rather than lock in. It will also mean a smaller Microsoft - and
thats gonna hurt.

I expect we will see something like what IBM went through - staggering
losses followed by restructuring and a change of direction. It will
probably be more than five years away, but no more than fifteen. I think
they will remain a big player, but will have a reduced market of between
thirty and fifty percent of desktop devices. I'm also betting that they
will move to Linux - and will "improve" on top of it - competing with KDE
and Gnome by creating a layer on top of Linux which is compatible with the
WinAPI. At least thats what I would do if I were them :)

Of course there is the coming patent fight Microsoft is planning. Perhaps
they will think better of it, since basically its a lose lose senerio. For
a company wanting to rebuild trust in the developer community attacking
open source and Linux would probably be about the worst possible move.

To begin with they would probably face all out patent warfare from IBM and
HP. They would probably have some difficulty with the DOJ. And needless to
say they would destroy any remaining trust the industry may have in them.
While they might win litigation in the short term - slowing or stalling
open source, ultimatly the outcome would be worse for them.

Ideally - if I were Microsoft and wanted to hang in for the long term, I
would conceed being top dog, and take a hit in order to stabalise at a
economically sustainable level. Right now I think the problem is that
Microsoft overheated - that they became bigger than the market can sustain.

The result was Linux, and no amount of patent litigation will destroy the
market force that drives companies to become economically sustainable.

So says I :)

Patrick Bold 09-05-2004 04:11 AM

Re: Microsoft: Linux is a threat, it may mean prices cuts and less business for us
 
"thing" <ms@thing.dyndns.org> wrote in message
news:SVv_c.2133$mZ2.188500@news02.tsnz.net...

>>

>
> There have been a few around the same vain. At present the share
> market loves MS for its returns and/or capital gains, however there
> are "intersting" pieces like this coming out, one wonders for how long
> MS will be wall street's darling.
>


It's been a long time since any tech stock was the "darling" of the
sharemarket. But so long as Microsoft has $US60 billion or so in cash to
play with, I suspect few investors will be frightened by these kind of
articles. Would you be?



Divine 09-05-2004 05:05 AM

Re: Microsoft: Linux is a threat, it may mean prices cuts and less business for us
 
On Sun, 05 Sep 2004 15:42:19 +1200, thing wrote:

> There have been a few around the same vain. At present the share market
> loves MS for its returns and/or capital gains, however there are
> "intersting" pieces like this coming out, one wonders for how long MS
> will be wall street's darling.


I think that the writing has been on the wall for several years,
concerning Micro$oft's demise.

Notably:

the resentment developed amongst businesses with respect to Micro$oft's
licencing practises,

the resentment amongst businesses with respect to dependence on Micro$oft
software,

the development, and ongoing development, of alternative high quality,
free, open source software that will salve both the above resentments.

Also, Micro$oft has been beligerant in spreading around its fud - and that
has been seen for what it is,

and the alternatives are demonstrating the ability to respond quickly,
openly, and honestly to flaws and bugs - unlike Micro$oft.

Micro$oft is in the middle stages of its demise.

1/ alienate clients
2/ other developers provide alternatives liked by Micro$oft's clients
3/ clients adopt those alternatives and dump Micro$oft.


Divine

--
"Even the most fanatical Microsoft supporter has to see that Longhorn has
become Shorthorn."


thing 09-05-2004 07:05 AM

Re: Microsoft: Linux is a threat, it may mean prices cuts and lessbusiness for us
 
Divine wrote:
> On Sun, 05 Sep 2004 15:42:19 +1200, thing wrote:
>
>
>>There have been a few around the same vain. At present the share market
>>loves MS for its returns and/or capital gains, however there are
>>"intersting" pieces like this coming out, one wonders for how long MS
>>will be wall street's darling.

>
>
> I think that the writing has been on the wall for several years,
> concerning Micro$oft's demise.
>
> Notably:
>
> the resentment developed amongst businesses with respect to Micro$oft's
> licencing practises,
>
> the resentment amongst businesses with respect to dependence on Micro$oft
> software,
>
> the development, and ongoing development, of alternative high quality,
> free, open source software that will salve both the above resentments.
>
> Also, Micro$oft has been beligerant in spreading around its fud - and that
> has been seen for what it is,
>
> and the alternatives are demonstrating the ability to respond quickly,
> openly, and honestly to flaws and bugs - unlike Micro$oft.
>
> Micro$oft is in the middle stages of its demise.
>
> 1/ alienate clients
> 2/ other developers provide alternatives liked by Micro$oft's clients
> 3/ clients adopt those alternatives and dump Micro$oft.
>
>
> Divine


4/ Lets not forget they have chopped up just about every major
competitor in the business, eg Novell, IBM, Netscape, Caldera. No big
players like them, thats a lot of enemies all with considerable clout in
Washington.
5/ Lots of smaller guys who's addons to MS OSes became "standard" in the
OS, either with MS developing its own or being forced to sell at MS's
price knowing MS would evelope its own and thier product would become
worthless.

Lately MS has tried to elbow its way into alternative business streams,
like mobile phones but its got to the stage that no company in its right
mind will deal / partner with them, too many burnt fingers, all the way
to the elbow.....

When your invited to lunch with MS make sure your not the main course.....

regards

thing






























Divine 09-05-2004 07:21 AM

Re: Microsoft: Linux is a threat, it may mean prices cuts and less business for us
 
On Sun, 05 Sep 2004 19:05:47 +1200, thing wrote:

> Lately MS has tried to elbow its way into alternative business streams,
> like mobile phones but its got to the stage that no company in its right
> mind will deal / partner with them, too many burnt fingers, all the way
> to the elbow.....


Which could explain why Linux is doing so well with embedded appliances.


Divine

--
"Even the most fanatical Microsoft supporter has to see that Longhorn has
become Shorthorn."


thing 09-05-2004 07:40 AM

Re: Microsoft: Linux is a threat, it may mean prices cuts and lessbusiness for us
 
Cheetah wrote:
> thing wrote:
>
>
>>Microsoft has filed a report with the Securities and Exchange Commission
>>(SEC) - and it looks like the Redmond giant could be in for a lean year
>>ahead, even going as far as to hint that Linux and other open-source
>>rivals might be to blame........"

>
>
> How has Linux affected Microsoft? I don't think it has really hit Microsoft
> in terms of Desktop units - since Linux accounts for under four percent -
> probably less in terms of desktop machines. In terms of servers Linux may
> be much more successfull, but is not pushing Windows out of that market.


Lots of ways, it has severely dented server sales. The next migration is
away from Unix and MS was aiming to be the platform because of Intel
hardware. Its in highly profitable servers sales, that MS say 5 years
ago could have considered it owned, with that the huge tie in a profits.
Now however MS's to move into the data center automatically replacing
Unix has been all but squashed by Linux and open source with commercial
companies on top (Oracle RAC as an example).

>
> However, what is telling is that Microsoft have been lowering the price of
> Windows to ensure that Linux doesn't get traction. Linux has already made
> MS pull up their socks when it comes to stability, and MS is still trying
> to address security. If nothing else Linux is valuable for the positive
> effect it had on Windows.


One of MS's own managers has admitted it is going to be 2011 before MS's
OSes can be considered secure...what ever that means.....Has XP improved
in stability? yes, was Linux responsible? I would think only in very
minor terms myself.

Munich moved to Linux even though MS under cut it heavily, Newham stayed
MS, probably because it had no real option, but MS blinked and Newham
got a good deal (well probably, 10 years is a long time in IT).

> Microsoft makes most of its dollars from Windows and Office. The operating
> system is fast becoming a commodity - as is office productivity software.
> They have also recently committed to giving cash to shareholders - so its
> huge cash reserves won't be quite so big.


As far as I can tell from reading MS's finances, its only profits are
Office and the PC version of its OS. Any other endevour has not made it
money, embedded MS has a small market share and the cost it has to be
cut to to be competitive with the established players means no fat
revenue stream. MSN last time I looked was costing them money, every
year I'm not aware that has changed.

>
> However, while it is encouraging to see that true competition is benefitting
> the consumer,


I see little sign Linux is helping Joe consumer, XP Pro off the shelf is
$800 v $10 for Mandrake...What was the cost of 2000 and NT4 before it?
was less if I recall correctly.

I don't think Microsoft will be going anywhere soon. And
> either would I wish it... I think perhaps that in the medium to long term
> we will simply see Microsoft return to providing real value and competing
> on merit rather than lock in. It will also mean a smaller Microsoft - and
> thats gonna hurt.


I think MS's mind set and business gearing is welded to high profit
margins and that I dont think it will change easily, that would mean its
share price would flop, but I think that is coming.

> I expect we will see something like what IBM went through - staggering
> losses followed by restructuring and a change of direction.


I used to work for EDS, IBM's biggest competitor in services, EDS still
has not re-structured along the lines of IBM, and its in a bad way
because of it, in fact it seems to be moving closer to MS everyday.

It will
> probably be more than five years away, but no more than fifteen. I think
> they will remain a big player, but will have a reduced market of between
> thirty and fifty percent of desktop devices. I'm also betting that they
> will move to Linux - and will "improve" on top of it - competing with KDE
> and Gnome by creating a layer on top of Linux which is compatible with the
> WinAPI. At least thats what I would do if I were them :)


Just like I dont see the point of unix services on the NT kernel, I do
not see the pint of WinAPI on top of Linux.

I think within a few years just about everything will be browser based,
so the OS will be immiterial.

>
> Of course there is the coming patent fight Microsoft is planning. Perhaps
> they will think better of it, since basically its a lose lose senerio. For
> a company wanting to rebuild trust in the developer community attacking
> open source and Linux would probably be about the worst possible move.


The trouble with the patent game is, it only applies in the US and not
(mostly) the rest of the world. So MS going for a patent war now will
see any hope of the EU allowing patent games similar to the US dumped.
Even if the EU follows suit the rest of asia and the 3rd world will not,
they can see the US trying to screw them over even if the EU is dumb
enough not to. MS as you say would need to hit big users of Open source
and that is going to win it no friends, kinda like SCO but on a bigger
scale. Even if that works it only applies in the US.

> To begin with they would probably face all out patent warfare from IBM and
> HP. They would probably have some difficulty with the DOJ.


Especially if a Democratic President gets in this time, the only reason
the DOJ was so soft was because of the change last time. IBM has a huge
portfolio, I wonder who would blink first? I dont think it would be IBM.

And needless to
> say they would destroy any remaining trust the industry may have in them.


From what I can see that went last year.

> While they might win litigation in the short term - slowing or stalling
> open source, ultimatly the outcome would be worse for them.


Only within the US, asia will next year supposedly pass the US in GDP,
so who cares about the US really?

> Ideally - if I were Microsoft and wanted to hang in for the long term, I
> would conceed being top dog, and take a hit in order to stabalise at a
> economically sustainable level. Right now I think the problem is that
> Microsoft overheated - that they became bigger than the market can sustain.
>
> The result was Linux, and no amount of patent litigation will destroy the
> market force that drives companies to become economically sustainable.
>
> So says I :)


regards

Thing


Patrick Bold 09-05-2004 04:46 PM

Re: Microsoft: Linux is a threat, it may mean prices cuts and less business for us
 
"Divine" <nospam@nospam.invalid.com> wrote in message
news:pan.2004.09.05.05.05.56.716114@TRACKER...

> Micro$oft is in the middle stages of its demise.


LOL.





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