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This is, after all, the man who once said "to heck with Janet Reno" during the early days of the company's antitrust saga, and who more recently has called Linux a "cancer."
So Ballmer's remark last month that a $100 computer would help alleviate software piracy and spread computing to developing nations seems tame in comparison.
"There needs to be the equivalent of a $100 computer, not just a $400 computer, if this stuff is really going to go down-market in some of these countries," Ballmer told attendees at a conference last month sponsored by Gartner.
But by suggesting that the industry needs to offer a cheaper PC, Ballmer puts himself and his company in an awkward spot: Will Microsoft take additional steps toward making low-cost PCs a reality by sacrificing some of its fat profit margins on Windows? Or will the software giant leave it to the hardware makers--already operating on paper-thin margins--to give back some green?
Let's take a look at where things stand. Microsoft currently charges PC makers anywhere from $50 to $75 per computer to license Windows, according to analysts' estimates. While Microsoft points out that the price hasn't changed much--in actual dollars--in years, hardware costs have been plunging. So the cost of Windows as a percentage of a PC's cost has actually grown significantly.
In recent months, Microsoft has introduced low-cost versions of Windows, called Windows XP Starter Edition, especially for developing countries such as India, Indonesia, Malaysia, Russia and Thailand. Word is that PC makers are paying roughly $36 per copy for the software, which can only be sold on new PCs.
Likewise, while top-shelf chips from Advanced Micro Devices and Intel can cost upward of $1,000 each, both companies are working on low-cost chips for developing countries. For instance, AMD's Sempron CPU can be had for as little as $39 when purchased in groups of 1,000.
AMD has even gone so far as to make available a blueprint for how to build a PC for as little as $185. Called the Personal Internet Communicator, the machine is geared toward families that make the equivalent of between $1,000 and $6,000 annually. AMD says that three companies in India and Latin America are already signed up to market versions of the machine. But that system wouldn't include a monitor and would run a variant of Microsoft's Windows CE, not the more capable Windows XP.
Similarly, Intel is investigating ways to make low-cost PCs available in Eastern Europe, India and other developing areas. The company, sources say, has been selling a special low-priced processor-and-motherboard combination as part of a project code-named Shelton. The ultimate goal is to produce a PC for as little as $199.
Halfway there?
Still, that brings us only halfway to a $100 PC, especially one that leaves room for any profit margins (or at least only halfway to a $100 Windows PC). If the goal truly is to give low-income people in developing countries access to computers, and--let's be honest--to expand into the next big market for computing gear, there are cheaper and easier ways to go than Microsoft's model.
If you want to spread low-cost access to computing, and ultimately protect intellectual property, maybe it's time to revisit Larry Ellison's concept of the network computer. You probably remember that the Oracle executive pushed the notion of small, diskless "appliances" that included a monitor, keyboard, network connection and not much else--especially no place to run pirated software.
The idea was that all of the smarts were pushed down to network computers from server computers running Oracle's database and communications software. Oracle was to make its profits by selling the server software to hosting companies, Internet service providers, governments and the like.
Ellison even founded a company, Network Computer, Inc., to manufacture and sell the devices. But after reinventing itself as a TV set-top box maker, that venture crashed and burned when it failed to get additional funding back in 2003.
Other companies--including Gateway, Sony and the former Compaq Computer--introduced cheap Net-surfing machines four to five years ago, and all ultimately exited the market as the cost, and profitability, of PC hardware plummeted.
Now, the modern version of the network computer concept comes from Sun Microsystems, which is pushing its Linux-based Java Desktop System as a low-cost way to provide computers to people in China and elsewhere. The company signed a deal last year with China Standard Software to provide JDS to millions of consumers. Sun is also aiming the program at India, Israel, Japan, South Korea, Vietnam and other countries.
Sun's ultimate goal is make JDS ubiquitous not just on PCs, but on cell phones, set-top boxes, game devices, cars--you name it. As with Oracle's original network computer concept, Sun expects the big money to be in server-based software and hardware, and in the network infrastructure needed by network operators to make the whole scheme click.
I know what you're thinking: Those who don't learn from history are doomed to repeat it. That may be true in Sun's case. But Sun's concept has one advantage for end users: price. Take a peek at Sun President Jonathan Schwartz's Web log. Never mind the $100 PC--Sun's president seems willing to give away JDS and make his money on service providers.
Clearly, it seems we're closer than ever to ultra-low-cost computing for the masses. Here's why: Enterprise technology sales are stuck in the slow lane. Microsoft has tempered future growth estimates. And Sun and other companies need fertile new markets for their gear.
Analysts expect 1 billion PC users worldwide by 2010, up from the current estimate of roughly 660 million users. The bulk of those new users will be in developing nations.
Devising a low-cost PC isn't an exercise in altruism. At stake is an opportunity to gain a foothold in what could be the biggest technology market opportunity this century. Ballmer has thrown down the gauntlet. So who's going to take up the challenge?
Biography
Mike Ricciuti is CNET News.com's Cambridge, Mass., executive editor and bureau chief.
21 comments
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Install Linux (free and much less bloated) and Mozilla (also free). Then you're ready to do all that most people use their PCs for: email and websurfing. Need more, like office tools, games, development tools, etc.? There are tons of free software out there for the downloading, in every conceivable category, much of it high quality. (Yes, not all is high quality, but neither is all commercial software.)
In fact, this would mean that the people would be even less likely to pirate Ballmer's (or indeed anybody's) software, but I still don't think he'll like it. ;->
The expensive part is the monitor. If they're willing to settle for 15", those can be had dirt cheap nowadays too.
If NOT you are using it in an ILLEGAL way and therefor per the "End User Agreement" your "License" is VOID.
This requirement also goes for almost every piece of software that you are running on the "HOST" machine even if you will NOT be sharing it with mult-user, read your "Software Products End User License Agreement" carefully including the one that comes with your OS.
Now if you where using Linux or BSD and www.ncomputing.com support using there product on such OS' you wouldn't have the License problem except for the rare case involving a some Comercial software packages.
of them are interested in kernel tuning? Out of that number,
how many of them have time to tune a kernel? I would love to
tune my kernel, and to read about how kernels work, and to
program a driver, but the time I would need to do that stuff is a
luxury that I rarely have. Ditto the luxury of trying out every
distribution of Linux that is released.
We ran w2k on about 50 pentium IIs with a max of 64 MB of
RAM with few complaints. Opening the help system for the
GNOME desktop on a system like that takes something like 5
minutes. OpenOffice.org Writer would probably cause the case
to explode. This isn't the fault of Linux, but the fault of the
GNOME people and the fault of OpenOffice.org. But that doesn't
make a difference to the market, which is not made up of
tinkerers like you and me! They want something that works
right away without problems.
surprised if someone came out with a distro
containing a kernel tuned specifically for
low-performance machines. One needn't try them
all, just find the appropriate one. Yes, that
may be difficult for individuals, but if people
in the First World are so concerned about the
digital divide with the Third, surely some
charity can take the time to find it.
If opening GNOME help, even on a P2 w/ <= 64M,
takes anything near 5 minutes, I suggest that
something was drastically b0rkened with the
install.
Granted, OpenOffice is bloatware. It's the
biggest Linux offender I can think of. However,
1.1 is MUCH faster than 1.0, and of course
abiword is still faster.
If they want something that works right away
without problems, as the ad said, "get a Mac!"
B-)
And where I live, the price of used CRT monitors has gone to zero - you can't give them away. People want flat-panel monitors.
1. AMD Athlon 1800 Processor
2. 10/100 Network Card
3. Dial Up 56K Modem
4. Keyboard
5. Speakers
6. Integrated Video Graphics
7. 128mb Ram
8. 40 Gig Hard Drive
9. Windows Like Linux Operating System
10.Mouse
Pick up an old CRT monitor for $20 at a garage sale and boom, you got your $199 computer setup. I'm sure if you scaled back hardware to even lessor specs than those a company could sell a brand new full system for $150 or less right now without any real innovation required.
If that doesn't work, then just sell all those third world countries our 5-10 year old computers that we no longer have use for. If nothing else it would help them figure out how to blow us up faster. LOL
Yes, this technology is already available (Applica) and exists for Linux as well (HP 441 and iBox).
$100.00 Computer
$149.00 OS
$199.00 Student Teacher Office
$59.00 Anti Virus
$59.00 Printer
as you can see the $100 computer is now costing about $550.00 of which only $159.00 is hardware the rest is software. So I would think this would increase piracy. The reason what really gets peoples goat every where is saying what we need is a $100.00 computer but that does not include the extra costs or actual costs to purchase.
Hec my totals did not even include Internet connection prices and cost of modems for broadband.
It would be nice for once when the said $100.00 computer that was the actual cost.
100.00 Computer hardware
$149.00 OS Linux based FREE
$199.00 Student Teacher Office Open Office FREE
$59.00 Anti Virus FREE personal setups
$59.00 Printer Hardware
OS For some possible FREE choices check out either <<a class="jive-link-external" href="http://www.frozentech.com/content/livecd.php" target="_newWindow">http://www.frozentech.com/content/livecd.php</a>> or <<a class="jive-link-external" href="http://distrowatch.com/" target="_newWindow">http://distrowatch.com/</a>>
For "Office Software" one possible FREE replacement for M$-Office {or student version} is Open Office, it can read and write most M$-Office type files.
"Anti Virus" there are free anti-virus software packages out there for personal use, plus Linux based OS currently don't have anywhere near the problems with such software.
Also included with any Linux based OS is full FIREWALL support built in.
I think there's alot of confusion about the $100PC comment. Yes, we can find older PCs for $100-200 or a new one without XP OS at Fry's. But, this PC Expanion is totally different from what we are imagining besides the person in Hong Kong who actually is running the units live.
Anyway, according to www.doublesight.com, PC Expanion is a non hardware based unit that allows users to expand an EXISTING PC to share its resources to up to 10 PC Expanion stations that actually work like a separate and secured PC. So, in other words, take this PC EXpanion, connect it to an existing PC (via network router), then the PC Expanion turns into another PC. Of course you need to attach it to a monitor, KB and Mouse but thats basically it.
Imagine, a small business owner doesnt need to purchase 5 separate PCs but now only has to purchase 1 PC and 4 PC Expanions. Im not sure about the total cost at the end of the day, but Im sure its cheaper to purchase the PC Expanions vs 5 traditional PCs.
Anyway, I just picked one up from COMPUSA here in San Diego. So, I will update later once I get it up and going.
ps. the cost was $199.
So, basically, I installed the software on my already exisitng PC. Then I installed my PC Expanion to the network router and bamm!!! my PC Expanion was a mirror imagine of my exisitng PC. But, the PC Expanion is a totally separate and independent PC from the host PC. I login separately and I can surf the net while my other computer is doing something different. We both can go into Excel or Word at the sametime without having any delays. Really cool!!
I can see this product being popular with small offices in which they already have an existing base of PC's that needs to be replaced or upgraded. Instead of buying 10 or 20 new traditional PC's, all you have to do is buy 10 or 20 PC Expanion to replace your old PCs. Security is good because no-one can remove data from your PC Expanion. Only the host PC can add or remove information. Negative, is that I cannot play 3D games.....no big deal. I will just play on my host PC and let my mom-dad use the PC Expanion for excel stuff or internet surfing.
Instead put up a Rubbermaid closet with an Expanion, LCD monitor. $5 mouse and $20 Virtually Indestructible keyboard. Expanion logs _into_ the main pc so whatever software is setup to run for all users _works_ for the expanion user. You need only run the setup disk on the host pc, get its ip address and set an ip for the expanion itself. Create another userid for them to log into and assign any permissions. Done. It handles 106 degree temps much better than a regular pc. Mind you, the whole station cost less that $1k to put up compared to $7-10k investment for a blockhouse and a pc station.
Only drawback I see is it supports PS/2 keyboard and mouse only and only has one monitor output.
But it is only $200