The Penguin Ping.
Wanna be Penguified? Just holla!
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Posted on 08/30/2002 9:58:01 AM PDT by ShadowAce
n these recessionary times, holding the line on costs is foremost in most executives' minds. Thankfully, in the technology world--unlike, say, real estate--Moore's Law and its corollaries keep innovation chugging along and prices continually on the decline, thereby lowering costs for us consumers. Case in point: You can buy a low-end computer today for $400, when five years ago it would run you at least $2000.
This has some PC manufacturers jumping into a different market altogether: the low cost corporate computer. IDC reports that sales of "white boxes," or generic low-cost PCs -- equipped with less than state-of-the-art components and processors -- now make up roughly 30 percent of the overall PC market. Companies such as Microtel have been selling white boxes for years, but last week Dell announced that it, too, would begin selling two lines of ultra-cheap PCs.
But as prices continue to drop and demand for cheapies grows, one company is finding itself priced out of the party: Microsoft. That's because its standard word processing, planning and spreadsheet software package, Microsoft Office, costs north of $450 --almost as much or sometimes more than the entire cost of a PC itself. With broad licensing deals, the cost for PC manufacturers is likely lower than the $450 retail price, but even so, the software represents an enormous percentage of total costs for the computer maker. As such, Microsoft is finding itself at odds with Moore's Law. Prices for technology have dropped, but office software has risen.
"Hardware [prices are] doing a good job of crashing through the floor," says Michael Robertson, CEO of Lindows, a company offering low-cost Linux-based desktop software to manufacturers. "What hasn't dropped is the cost of software. We're going backwards because of things like licensing and activation codes. The effective cost of software is actually going up."
Microsoft's insistence on its pricing model and ever-stricter licensing plans is opening the door for companies such as Corel, with its Word Perfect suite (remember that?). HP sure remembers it, and announced earlier this week that it would ship Corel with its entire Pavillion line of consumer PCs. Last week, Dell announced it would be offering Corel WordPerfect Productivity Pack (the Corel equivalent of Microsoft Office) on selected models of its Dimension desktop and Inspiron notebooks.
Microsoft doesn't appear too worried, telling News.com: "With over 300 million users worldwide, Microsoft Office has become the choice of individuals who need to be more productive and organizations who need a reliable set of tools to run their businesses."
Should the current economic climate extend even further than many are predicting it will, other non-Microsoft markets could open up, including Linux versions of desktop productivity software. Companies such as Lindows, Mandrake, and CodeWeavers have Microsoft-compatible software out now, but they're struggling to find a market.
One of the favorite pastimes of any technology watcher is to imagine scenarios in which Microsoft could be toppled--if for no other reason than because it seems so damn invincible. These recent developments hardly signal the end is near for Redmond. But as history has proven, it's a bad idea to put yourself on the other side of Moore's Law, a place Microsoft finds itself now that PC prices have finally fallen below the cost of its software. Too many companies have fought the law, and the law has won.
Wanna be Penguified? Just holla!
Got root?
Any hardware, twice as fast, will be upgraded with software four times slower. Any doubling of hard disk capacity will be met with the need for four times as much disk space. The doubling of bandwidth of a bus will be burdened with four times the data to carry, and the user interface for all of this will be designed by a group of idiot-savants still in love with the Microsoft Mistique.
Cheers.
That's a "bob and weave" statement. While it is true that MS Office is the de facto standard for business, it's not necessarily true that this was the result of "the choice of individuals."
If an individual bought a new box with Windows XP/2000/etc. that came with Office as well, that individual wasn't too much in a hurry to go out and buy another office suite. Couple that with the fact virtually all companies use Office and the true meaning of the word "choice" vanishes.
I don't want to see MS "toppled," per se. What I want to see is good, quality software. And I don't care who makes it.
Well, forget I said that! :-)
I'll be honest here. Since I already knew VB and C++, I was interested in learning C#. But I wasn't about to pay that load of dough for the suite. But now Mojo has taken care of that for us *nix users, so I'm learning it. It's like a cross between C++ and Java so it's not entirely new to me.
Outside of that, I haven't really studied up on the .NET business strategy, so I can't truthfully comment on it one way or the other.
Guess I'll do that now.
This is my pet peeve about "commercial" software generally - not just Microsoft. We know that certain packages are priced way out of bounds, merely to segment or limit the market (not everyone needs Microsoft Project or RealServer or PhotoShop, but someone might want to try it out if the price were lower).
And, contrary to a widely held perception of the typical Open Source advocate, I do not have a problem with paying for software! But make it a reasonable price, based on the usefulness of the software... not just because Marketing thinks it can charge $x and still get buyers (gotta cover the CEO's stock options).
Reasonable pricing might reduce the piracy problem as well. If I wanted to "try" something priced above $y (a reasonable value to me, based on what I plan to do with it) I might be inclined to obtain a cracked copy. And then continue to use the cracked version as a protest against the market price, rather than to go buy a valid license for something I have found useful.
Microsoft doesn't appear too worried, telling News.com: "With over 300 million users worldwide, Microsoft Office has become the choice of individuals who need to be more productive and organizations who need a reliable set of tools to run their businesses."
We've got mostly everybody addicted to the "pure" stuff, and if they want it, they have to come to us.
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