Win9x/ME - Volume Licensing = More Unix? 14
utoddl asks: "Now that Microsoft is dropping volume licensing for non-NT versions of Windows, will corporate types who are forced to 'upgrade' from their Win9x OSes be any more likely to look at alternatives to NT (say, Linux, for example) than they would be otherwise? Could it be that Microsoft's attempt to increase the NT revenue stream by forcing the hand of slow adopters cause some to adopt something else instead?" Ouch! This will cause hell for shops who have a large number of Win9x based clients. Is this a desperate move by Microsoft to increase revenues from one area that they are expecting to lose in another year?
Maybe not... (Score:1)
I would think that this would probably apply to volume licensing as well....
Would anybody in the States who has been keeping an eye on the Microsoft vs. DoJ case care to advise ?
Oh yeah, FiRsT PoSt!!! :-)
"Be vewy vewy quiet, I'm hunting wuntime ewwors!" - Elmer Fudd
Reality Check (Score:3)
I recently wrote up a file transfer procedure for NT systems that uses a Win32 command line program to transfer the file to a UNIX system. When I said "command line", I got the same reaction as if I had said "radioactive waste". And you want these people to use UNIX?
Yes, definitely. (Score:1)
Re:Reality Check (Score:3)
In general, yes. At least so long as the fees don't get too expensive.
But think of it probabalistically: some companies that were wavering for other reasons may now switch due to this "straw". Put another way, it shifts the center of gravity of "desire space" a small increment away from Windows.
> They have a huge investment in existing software and training for Windows. They would have to dump Office and their custom apps, buy and install new software, retrain employees, and incur other costs.
Of course, they are already incurring these costs everytime Redmond comes out with a new version of its OS, or office suite, or anything else. Shipping your employees off to a week-long training class is every bit as much a part of the upgrade treadmill that paying again is.
A farsighted manager would interpret that as being his cutover to Linux already being partly paid for -- it's in the budget anyway.
> When I said "command line", I got the same reaction as if I had said "radioactive waste". And you want these people to use UNIX?
And of course, that shop didn't have their staff wasting 3-5 hours a day playing Solitaire, Minesweeper, or more complex games that they brought from home and loaded on their workstations. I've worked in shops where exactly that happened. How many people at your PoE turn their screens where they can be seen by someone walking in the door, eh? I suspect this factor in the Windows TCO absolutely dwarfs all the other factors together. In the VAX shop I mentioned, this problem was completely absent.
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Re:Reality Check (Score:1)
Tell it, brother! Nothing like having a clerk who should be working ask "Why is my machine so slow?" and seeing IE pointing to some not even remotely work-related site, Solitaire running, Webshots, AOL IM, Realplayer, ICQ, and Bob knows whatall of non-work related crap sitting in the system tray. First thing I do is start killing tasks. Amazing how much faster Word runs once that's done :).
Not trying to be self-righteous--Bob knows I read my share of /. at work, but heck, if people are going to complain that their machines aren't fast enough, I wish they'd at least have the courtesy and common sense to not have them blatantly loaded with cruft before asking for help!
The crystal ball is cloudy. (Score:4)
It's almost certainly a money grab; for the past year they have been announcing a continual stream of "reorganized" licensing plans, and in every case that I've heard of, the customer pays more for the same product or service, or pays the same and gets less, or pays more and gets less.
As a WAG, I would say the money grab has more to do with a cash flow problem than with pillaging a province that they think is about to be pillaged by barbarians anyway. There are multiple signs that MS isn't generating the kind of cash they need to from software sales. Reports of an (illegal?) "cookie-jar" scheme have been rife for over a year now. More recent reports claim that they made more money last quarter by selling off assets than by selling software. Moreover, the vaunted W2K "Unix Killer" has ended up instead playing Little Dutch Boy, vainly trying to stem the flow of Linux into the serverspace market that MS thought Manifest Destiny was going to drop into their own hands. Nor has W2K been a big seller in its own right: after a reported $1,000,000,000 in development costs and another whopping $500,000,000 in the initial marketing blitz, it's not exactly cropping up on every street corner.
For Microsoft, there's not much more to be had by increasing market share. The part of the world that can afford computers is practically saturated, and there's not much competition left for Microsoft to seize pre-saturated turf from. They find themselves stymied in serverspace, and on the desktop they have already reduced their most visible competitor to the status of a conquered client. So their cash flow is almost entirely dependent on the upgrade cycle, or ventures into entirely new fields (can you say "X-box"?).
And then there's the valuation of MSFT. From around 120 in late '99, it dropped to around 55 in mid '00. That was before the current landslide in tech stocks got started. MSFT did pull up somewhat from the 55 and stabilize for a while before the landslide started, but now it has been caught up in it and `fallen into the 40's. The outlook for their next quarterly report is bleak indeed.
And make no mistake: Microsoft isn't "about" software. Microsoft isn't really even about making money. Micorsoft is about the share price of MSFT. Cash flow and software design are both subordinate to that higher goal.
So I would guess that this and all other attempts to squeeze cash from its installed base is all about making the books look good so MSFT will soar again. (I wouldn't bank on it -- in fact I told a friend 18 months ago to get out of MSFT -- but Microsoft will keep trying to pump it back up as long as they have a customer left to squeeze or penny left in the bank.)
The interesting part of your question is, will that squeezing make customers turn elsewhere? Linux has been making inroads already, and by some accounts is already used on more desktops than the Mac is. It's certain that the world won't switch to Linux overnight. But the world could look vastly different in 12 months. If MSFT continues to fall, Microsoft will continue to squeeze. As Linux continues to make inroads into server space, more powerusers will be exposed to it and adopt it for their own desktops. As more people adopt it for server or desktop, more companies will port their commercial products to it. (There has already been a notable shift in that direction over the past year or two.) With I2O supported in Linux 2.4, the possibility suddenly arises that the latest newfangled peripherals will suddenly start working on Linux the same day they work on Windows.
The net result is that Microsoft not only doesn't have anywhere to expand, but it suddenly finds even its upgrade market shrinking, if only by a little. But when upgrades are your primary source of revenue, even a small shrinkage puts a real squeeze on your desire to look "way profitable".
You can think of Microsoft's market share as a leaky innertube. There is already a minor flow out toward Linux. Squeezing the tube can't help matters, and at some level of pressure will make the difference between a slightly accelerated leak and a loud pop.
Microsoft can't keep going the way they have been for the past 20 years. I think the X-box is a sign that they know it. Even if the courts veto a breakup, you can bet that they will have a radically different position in the market before long, probably within a couple of years. That won't be entirely or even primarily due to Linux, though Linux is playing a role in it. It's one factor among many.
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Who does this really affect? (Score:3)
I doubt many small businesses are willing to "pay twice" to get Win9x/ME volume licenses (once when they buy the PC, again under the OLP).
Larger business with real IT departments will already have a solid understanding of the benefits of standardizing on NT/W2K as the desktop OS, and aren't likely to be using Win9x/ME except in very limited circumstances... Laptops come to mind as having been typically bad candidates for NT once upon a time, but vendors eventually got their acts together and W2K resolves most of those issues.
I'd think that 1999 saw many companies replacing Win9x and NT3.5x desktops with NT4 in preparation for Y2K. Rollouts are painful, no matter what the OS, and I expect many companies aren't ready to take the plunge again.
I can't see anything that Microsoft does causing companies to move to Linux or BSD. Companies will move when it makes sense, and for most companies it just doesn't make any sense.
At my company, we could probably move Sales, Service, and Support to Linux/BSD easily. Support would need VMWare for a few things, but email and the browser are the primary applications for these people. But other groups, particularly Billing and Finance, are heavily dependant on Excel and Access... being less technical users, Linux/BSD + VMWare would be a poor solution for them.
For us, and probably most other companies, it boils down to the costs of supporting all of these users. It's much cheaper for us to staff our internal support department with three Wintel lackeys than two Wintel lackeys plus two *nix lackeys. And the Wintel lackeys probably are cheaper and easier to find/train.
-Bryce
Not using their monopoly ?? (Score:2)
They had a low quarterly revenue. This is quite easy to rationalize, and it is not about market saturation. It is about the economy slowing down, and people no longer buying new computers. Microsoft lives and dies off new computer sales. They OEM their Office quite inexpensively, and OEM their OS. People talk about poor Windows 2000/ME acceptance, but Windows 95, 98, and NT ALWAYS generated primary revenue off OEM sales. If OEM sales drop 20%, Microsoft loses money. But make no mistake about it - they still have an insane profit margin.
To get around their revenue loss, they squeeze the people who have the most invested in Windows - IT shops. These people have integrated networks of Windows, and Microsoft has them by the balls. No more volume licensing is a sure fire short term strategy. Over the long term it could hurt them.
But marginal markets are already thinking about linux as full shops. And it is happening more and more. Some use them only for servers, some use them for desktops as well.
But this move by Microsoft is about squeezing people who have no choice for more money. That is the way a monopolist uses the monopoly to their advantage. That is the Microsoft way.
lemme underscore some comments (Score:2)
Win 98/ME is designed for lightweight use, and gaming. It's not a serious choice for corporations. It's too easy for the user to break -- if it doesn't break on its own.
Once you go pre-emptive multitasking, you'll never go back.
Re:Who does this really affect? (Score:1)
int break_spirit()
{
crush_nutz(left_nut,right_nut);
return(1);
};
Re:The crystal ball is cloudy. (Score:1)
This is true of *all* companies that are issue public stock. Mocrosoft, Red Hat, Boeing, General Foods, all more concerned about stock price than almost any other factor.
Such a concern is mandated by law, a public stock companie's primary activity in the eyes of the law is to protect the investment of the stockholder.
Whether this makes sense or not for someone who didn't buy the stock at IPO is another matter. [If I buy a share of General Foods today, they don't see a penny. It actually costs them money as they must track who owns what shares of stock.]
Re:Reality Check (Score:1)
Usually, the people who make the decisions/mandates are the people signing the checks.
While I don't work in the Systems group of my company's IT Department, I can tell you this based on recent discussion with my boss: We just got socked by the Microsoft Licensing Fairy due to misrepresentation on how SQL CALs work in conjunction with IIS, and my boss (who oversees the IT Department as well as other operational groups) is not pleased. I believe "Taxation without representation" were his exact words. And while I doubt a change will happen anytime soon, he wants to start evaluating other alternatives. And as I hinted at earlier, he's the guy who ultimately spends the money and makes the call on what we do.
The biggest fees are in the CALs, anyway. Take for example, our batch of MS SQL Server 7s. It's a piddly couple of grand for the server and the software, but it's the $90/user (times 1400 employees, in our case) where they get you. Heck, leave the frontend the same. Let the users have their NT4. But I'm all for at least evaluating the alternatives (Linux, *BSD, SAMBA, MySQL, Apache) in the Enterprise. And the bosses
Re:Who does this really affect? (Score:1)
It's not unreasonable for a group that has their computing needs met by a certain platform/configuration to try and stay on that platform/config as long as possible to keep the cost of change down. This is very common for non-computer-related businesses.
I'm just glad I'm not in that position :-)
- Mike
Re:Who does this really affect? (Score:1)
Actually, it's usually the larger, more ossified businesses that still have large Win 95 (or even Win 3.1) deployments out there. Often it's for very good legacy app support reasons.