Comments on: Microsoft to open source: Please don't compete on price!

Price isn't the only reason to use open source, but it's a pretty compelling one for a lot of businesses, which may be precisely why Microsoft asks open source to not focus on cost.

[myles taylor]

"While competing on price isn't the only way to run a business, it's worked well for Intel, Dell, Wal-Mart, Salesforce, JetBlue, et al.
That's good company to be in."

There is also good company to be found in companies that DON'T compete on price.. Luxury car makers, Apple, etc. Maybe not in this economy, but still.

[Sausagebiscuit]

I enjoy what sometimes spending a bit more money can save in the long run. People often associate price with quality, but most are smart enough to know that if something is cheaper and does the same thing and has near the same quality, then price is really the only difference.

There are really three considerations for sale: price, quality, and performance. You have to decide which balance of the three you want. Cheap and does what you want, but has low quality? Cheap, good quality but doesn't quite do what you want? Expensive, but great quality and does what you need? Choices!

[pentest]

But unless you are comparing a PC around the same price as an Apple, they don't do the same thing, and the PC is crippled by Windows.

[Genjinaro]

I just wish more people would adopt linux and quit with the whole "its too hard gig" and really stick it to MS & Apple as well. For 3 years I kept puttin off linux because of the talk of it being very hard & a few google searches showed me how ignorant my mindset was.

You don't have to be a tech nerd to get the feel of linux (thats what Google is for) but have the will to learn something new, all linux cost is your time & alittle education.

Google has taught me how to use linux (Ubuntu/ gOS3) and its been cake & ice-cream ever since, I've dug soo deep into linux, all I ever need M$ for is gaming & my preference to use M$ Office.

In my honest views I think OEMs who consider linux should distibute easy to use distros like Ubuntu & ubuntu variates as a gateway, not to knock the other distros but strenghten exposure.
Microsoft should keep light on Windows 7's price because I feel this lashout on open source pricing is just to soften the blow for a hefty OS pricetag they have in the pipeline.

[Sausagebiscuit]

Gaming is getting easier on Linux, with Wine and other compatibility layers and emulators (wine is not an emulator *wink*). However, it is still a long way off as far as commercial games. I think the only real support has been from ID (Quake, etc) with native Linux binaries. Everyone else writes it off as not enough market share... which may or may not be true.

It will take many more years to undo what Microsoft has done (proprietary lock ins, for example). I am not bashing anyone here, so don't take it as such. Open source has a strong backing and hopefully will only improve over time. This should also help innovation on the commercial software front.

[iertry]

"I just wish more people would adopt linux and quit with the whole "its too hard gig" and really stick it to MS & Apple as well. For 3 years I kept puttin off linux because of the talk of it being very hard & a few google searches showed me how ignorant my mindset was. "

Not everyone uses MS or Apple because they think Linux is too hard. I use to use XP and Linux (Ubuntu) and found it pretty simple to use once you learnt the basics of a new OS. I now have a Mac and have Ubuntu in VMWare but I choose to use a Mac because I prefer it, not because I find Linux too hard. I think Linux needs to add more polish. I think the current Ubuntu for example is better than XP but not as good as say OSX Leopard. There just needs to be more attention to detail. Ubuntu is heading in the right direction though.

[pentest]

ierty,

You should try a legitimate Linux distro, you might be shocked at how it is pretty much on par with OSX.

[sargess25]

"Sam Ramji, urged open-source vendors not to compete with Microsoft on price, but instead focus on "value."

lol ... I look forward to a Linux campaign showing how much more expensive a Windows PC is against a Linux one. The joke is already on Redmont, ah the irony! these people have no sense of humour .... I guess is quite fitting given their uneducated, skint lowly-paid customer base. Windows OS is to software as McDonalds is to cuisine

[phylum--2008]

"given their [Microsoft's] uneducated, skint [sic] lowly-paid customer base."

Speaking of uneducated, it's "Redmond", not "Redmont".

Nice ad hominem. You know why McDonald's is successful? Great marketing and product consistency. You can ***** about the lowest-common denominator all you like, but it won't change the fact that companies like Microsoft and McDonalds will continue to utterly dominate their respective market spaces as long as competitors take an Ivory Tower approach to their competitive marketing activities.

It's the same reason Ubuntu is kicking the ass of Debian -- Ubuntu's marketing presents a meme that is friendly, helpful, and easy to use. Debian presents a marketing meme that is based around standards conformance, GPL compliance, and a social contract. News flash: most OS customers don't give a damn about the GPL, establishing a Rousseau-like social contract, or asolute conformance to open standards. They just want to use good, easy-to-download-and-install software, and that's why Ubuntu will win the Linux desktop.

And for what it's worth, I'm a PC user with a M.Sc. from Johns Hopkins and an outrageously large salary. And I'm not nearly as well-educated or financially endowed as many of the PC users I know...

[pentest]

MS is like McDonalds, but at 4 star restaurant prices. Linux is a 5 star dining experience at McDonalds prices.

[bimmin]

It seems like most of this world is ignorant. Nor do they care about such issues. Recently, a friend of a friend was trying to get an MS office key from my friend. This person was a college student and only uses office to write papers for school. We suggested using OpenOffice instead of overusing the MS key. This college student had never even heard of OpenOffice before! I could hardly believe it, but that's the way it is. 99% of people are not technical at all and are just blind users.

[rapier1]

And then there are people who know all about this thing and still won't use OpenOffice. Its good for a lot of uses but for complex documents its still the best solution available. You also have the advantage of it being, for better or worse, the lowest common denominator for editable document exchanges (with the obvious exception of ASCII and RTF). Not saying this is optimal but even a bad standard is better than no standard.

[Random_Walk]

The funny part is, Linux can also compete very well on value, as well as on cost... Ramji better be careful what he wishes for. :)

The only two things Microsoft still has any (albeit a thin) edge on is familiarity and featuresets. I'm thinking along the lines of MS Office and its integration within an enterprise when I say that. Otherwise, their products are expensive and overly-complex (we won't even bother to bring up their security woes, at least in any detail).

If Zimbra or SuSE OpenXchange Server ever get seamless integration, Microsoft is toast.

[YZD1]

M$ will not let this happen. YAHOO is planning to chop ZIMBRA.

http://www.washingtonpost.com/wp-dyn/content/article/2009/04/16/AR2009041601393.html

[ewilen]

The Washington Post article linked by YZD1 isn't about Yahoo's plans, it's just rambling by an Internet pundit...who's also quite mistaken about the value of Zimbra to Yahoo. Yahoo uses Zimbra to power its mail system, and also to provide an offline client for their web-based features--similar to Google Gears but already at an advanced beta stage.

[gp2792]

"Open source can lower the price of running e-mail (Zimbra, Open x-Change), CRM (SugarCRM), ECM (Alfresco, Drupal/Acquia, Joomla, KnowledgeTree), ERP (Openbravo, Compiere), IT management (Puppet, Hyperic, Zenoss), and other systems to $0.00."

What a sensationalist load of bull. Show me the IT shop that has reduced costs to $0.00 for ANY service...please, I'd love to see it. Perhaps you can make a case for reduced TCO versus a Microsoft solution, but I don't see any proof of that in this article. This is another one-sided article only slightly less researched than the "Microsoft Bridge" article.

[zelrik]

You want a case? Google is your friend. There is one strong case of reduced TCO obtained by deployements of Ubuntu on the desktops. Do your homework.

[Random_Walk]

To be fair, Matt did goof a touch. OTOH, Google the acronym "CAL". Then realize that once set up and operational, you can easily forget most of those systems, revisiting them only when you need to update, patch, or add new features to them.

[rapier1]

@zelrik,

You only get $0 TCO if you don't include the cost of the hardware, the power costs, the building costs, and the costs of your IT staff's time. You can argue that OSS can reduce TCO below other options but there is no way you can reduce it to $0. Its an accounting impossibility.

[Dalkorian]

Rapier1, do you realize your argument amounted to "walking isn't free because you have to buy shoes and/or eat food for your body to use as fuel."? I think we all realize the IT staff isn't suddenly working for free and the electric bills still need to be paid, but those are constants that do not depend on what solution you decide on.

You have to admit this reaction from Redmond is a little ironic considering their new laptop ad campaign against Apple. "Do what we say, not what we do" - LOL.

[rapier1]

@Dallorian;
Anyone that is arguing that the TCO of something is $0 is deluding themselves and spreading misinformation. I don't see how reminding people that computing, of any sort, has costs associated with it, is a bad thing. Asay himself argued that using OSS can bring costs to $0.00 which is just a ridiculous statement to make. Like I said, you can argue that the costs will be lower but 'free'? There ain't no such thing as a free lunch. Anyone saying that is trying to pull one over on you.

[aMUSICsite]

Microsoft has got to be the only company with enough cheek to have adverts running on TV that are highlighting PC's are cheaper than Macs then turn round to their competitors and say it's about value not price!!

[sanjayb]

I guess they know how to twist an angle to suit their needs.

[Genjinaro]

As much as I prefer MS over Apple, MS put their foot in their mouth with this one. I'm sure Canonical, Cisco & Apple are chuckling at this.

[professionaladventurer]

The educated shopper knows with a little research and knowledge you get what you pay for - every time. If you invest in yourself, you can make linux work for you, if you invest in Hardware/OS you get Apple, if you walk in the middle of the road, you get a M$ system.

[GarCorp]

Simply put:

Has everyone forgotten that it's a matter of taste? If I want a bargain, I buy a Hyundai, if I want more, I buy a Lexus... BUT IT'S MY CHOICE. my dime, my taste, my opinion. I'm not a stupid consumer ... I don't belong to a cult.

Let's let the free market decide, and can we please cut out the rhetoric.

-G$

[Genjinaro]

LOL not to nitpik but the Hyundai Genesis kinda whoops on any of Lexus' sedan parade when it comes to more & still less without skimping on quality. It'd have been better put had you said Maserati/Hyundai or something.

[wfrobozz]

Its also your choice to run the risk of viruses/worms like Conficker stealing passwords, credit card numbers, etc. In the end its about choices, but just because you can make your own doesn't mean its a good choice.

[Noneyabeeswax]

"There are really three considerations for sale: price, quality, and performance. You have to decide which balance of the three you want. Cheap and does what you want, but has low quality? Cheap, good quality but doesn't quite do what you want? Expensive, but great quality and does what you need? Choices!"

How about: Cheap, good quality and does exactly what you need? That is not impossible you know.


You're falling into the expensive means quality trap there.

Expensive does not equal quality..

Just ask all those peeps who bought AMD Vista machines that had to reload their OS after the SP3 debacle...

And hey, a lot of Intel based machines had problems too..

[seven7dust]

the only problem with linux is it's free ! yes you heard that right
the fact is Money makes the world go round

unfortunately no one trusts free
also without Financial backing and cutting deals behind the scenes
it's impossible to increase Linux adoption !
Hardware sells software not the other-way around

Linux devs can a learn a lot from Apple !
ease of use and marketing are King
Price matters little in the end !

[bimmin]

There are enterprise versions of Linux which cost money.

Also, I'm not aware of any Linux distribution that also sells hardware. Someone like Dell/HP etc. should start there own distribution and market it and see how it does.

[jessiethe3rd]

I'm here with you...

The Linux story is..."it's free sir." Wait, this Enterprise distri is not free.... it's cheap, "what about support?" More expensive. All this desire to remain vendor neutral and keep all your options open for basic infrastructure... it's hokie if you ask me. Different point solutions... higher support costs. there's no if, ands, or buts about it. If you had a car and you started putting a bunch of different parts in it (after market, non-OEM) just expect support costs to increase - some things gotta give here. The more after market, "pimp my ride" strategy you take the more challenges problems and key higher COSTS.

The Microsoft integration story is by far better, whether you like the company or not.

In my opinion your infrastructure shouldn't be shuffled around.

[Marc Thibault]

Was it such a slow day that you had to invent a story? Ramji did not urge open source vendors to do anything. He did not urge them to stop competing on price. He doesn't appear to care one way or another what the open source competition does. Did you even read the article?

Ramji did say that Microsoft's open source allies should stress value, given what they have learned about their customers' reaction to tight budgets. He's suggesting they fish where the fish are. It's good advice.

Move along; nothing to see here.

[jessiethe3rd]

haha.... something about Microsoft speaking to the open source community just didn't sound right. Agreed - nothing to see here.

[DCDamio]

first off:
http://graphjam.com/2008/12/20/song-chart-memes-usability-by-operating-system/
go there. it's hilarious.

second, so what if you have to pay for support for your open source software? You pay for it already with both MS and Apple, it's just included in the total price already. Apple offers Applecare, an extended service plan, and most places that you buy pc's from offer an extended service plan as well (Black Tie Protection from Best Buy's Geek Squad)

The thing that gets me about all the debates about "No, MS is better, No, Mac is better, No, Linux is better!" is that it ISN'T about which is best overall, it's about which is good for the application you need. Macs are able to processess audio and video more efficiently than MS and Linux, MS is fairly user friendly (keep in mind user friendly meaning friendly to the users that aren't very experienced, not the tech-saavy geeks that do a good chunk of the posting on articles like this) and also the most popular gaming platform, and Linux distros are an alternative to both that might not be as easy to use as MS or as processor-efficient as Macs, but save you quite a bit of money for a teensy bit of extra work. I don't care how smart or tech saavy you are, if you can't understand that each system has it's strong point, it's niche in the computer world, then you're not as smart as you seem.

And to the nit-pickers that tear articles like this apart (TCO bashers), YOU'RE MISSING THE POINT OF THE GOD DAMNED ARTICLE. It's assumed by the author of the article that no one is really stupid enough to believe that you can run a server mainframe for nothing. What the author probably means is that the cost for the SOFTWARE to run said server can be reduced to nothing. Honestly, saying that the TCO is 0 is MARKETING in favor of OSS. Got it?

[sam_ramji]

What I stated was that while customers are always focused on reducing costs, our recent research with customers in multiple markets since the economic downturn began has shown that while they are reducing controllable costs as much as possible (delaying purchases of new software and hardware, reducing travel and training), they are still buying for strategic IT projects - those that the business has determined will drive revenue or cut costs across the company (customer insight, business intelligence, inventory or financial management). For these projects, companies realize they will depend on their effectiveness and reliability for many years, and are therefore focused on value as they start the buying process. Price is important, but is emphasized later in the process.

Of the 110 open source companies who attended Microsoft's 3rd annual Open Source ISV Summit, we got positive feedback on the strategy and guidance that we offered on how to succeed as a software vendor in the downturn.

What Matt overlooks here is that Microsoft's business model is based on the financial success of our partners. The guidance I gave was on how to win customers - for the benefit of our partners, who contribute 96% of Microsoft's revenue. We deeply appreciate them and attempt to give them the best market intelligence we have to help them succeed.

Sam

Sam Ramji | Sr. Director, Platform Strategy | Microsoft Corporation

[gggg sssss]

real people run windows because it runs the software they need to do real jobs that ultimately make up the economy we are all worried about. Running twitter is not something that anybody actually makes money at ( except for those ripping ofthe other twitters with ads.)

[andserve]

Hi, First of all let me say, that I always was interested in Linux and I have Ubuntu on my dual boot machine with XP. I agree that Ubuntu is the easiest Linux to use yet. However, when I'm on the Internet I find that XP does a lot better job of displaying web pages. Firefox on Linux doesn't seem to show the fonts as well and the scrolling is not nearly as smooth as XP. Firefox on XP does a lot better job of handling the web display. If this is a configuration problem let me know. But in the mean time I'd rather be doing my web stuff in XP. Shoot me if you must but compare the web experience and you'll see. That's the reason the you see XP on the web books and not Linux. They started out with Linux but but XP sold better. The web experience is better.

[wickedsmart77]

Yes, it?s all about price! Price is typically not thought of as an asset in large part because of the way that most firms go about their pricing decisions. The dominant pricing methodologies in most businesses have not changed much over the past 30 years (e.g. cost-plus rules, margins, everyday low prices, etc.), and these approaches don?t address something fundamental about the price structure: that near-microscopic up or down tweaks of individual prices throughout the firm?s voluminous opportunity set can result in dramatic profitability gains. These ?tweaks? are quantitatively-derived outcomes of analyzing the cross-elasticities between all of the products (SKUs) on offer and the customer demographics, geographic locations, marketing vehicles and distribution channels, as well as outside influences such as seasonality, macroeconomic forces or competitor actions. This process, i.e. Scientific Micromarket Management, allows you to assess how each customer values your product and offer that exact price every day in every market. Here at Sentrana, we've been producing unprecedented returns for Fortune 100 clientele, take a look at our site today for pricing optimization software:

Joe Smiley
Sentrana
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http://blog.sentrana.com