April 11, 2006 4:00 AM PDT
Perspective: Ushering in a new era of angst at MicrosoftSee all Perspectives
Until the late 1980s, OS/2 was judged technically superior to Windows, the Mac featured a better user interface, and applications like WordPerfect and Lotus 1-2-3 offered more features than comparable Microsoft offerings.
Undeterred, Microsoft eventually dusted the competition by offering good enough technology, superior pricing and attractive bundling. Once it got a foothold on the desktop, Microsoft enhanced its software over time. Ironically, this same strategy is about to lead to a whole lot of angst in Redmond.
At its recent Brainshare conference, Novell demonstrated a beta version of its latest Linux release, Suse Linux Enterprise Desktop 10. Until recently, Linux desktops were the domain of hobbyists and geeks, but improvements in Linux releases like Suse Linux Enterprise Desktop will likely broaden the appeal and make Linux a viable choice for a whole lot of business desktops.
This new Linux rips a page out of Microsoft's good-enough playbook.
First, Novell's Linux desktop comes bundled with Open Office 2.1, which supports your basic word-processing, spreadsheet and presentation applications. I'm sure some of the bells and whistles Microsoft bakes in are missing, but there aren't any obvious functionality gaps. In other words, it's good enough for the majority of employees whose jobs depend on doing basic stuff.
Novell's Linux desktop has also greatly improved in terms of installation and driver support. Intuitive wizards guide users through the OS installation process, while devices like printers and USB flash drives are recognized just like Windows plug and play.
Finally, the Linux desktop and Open Office have improved Windows interoperability. You can open a Microsoft Word document using Open Office without losing formatting properties, then save the document in a native format. Linux can also be configured to emulate Windows to support legacy fat-client applications.
Now here's the kicker. Linux/OpenOffice desktop costs about $50 per year, while a loaded Windows desktop comes in at around $500. Volume discounts would apply for both alternatives.
Of course, acquisition costs are only part of that famous analyst moniker "total cost of ownership," or TCO. It would certainly cost some dough to convert documents, test applications, train employees and roll out a desktop migration. Nevertheless, this would be a one-time cost, and organizations would have 90 cents of each desktop dollar to dedicate to these migration costs. At this rate, if you could simply break even in year one, you'd save oodles of cash ever-after. Remember too, that your $50 per year gives you the latest and greatest Linux desktop, while Microsoft will be back in three years (or so) asking you to upgrade everything.
Novell isn't capable of leading the Linux desktop charge on its own, but there are plenty of others in the industry more than willing to help. IBM could certainly move the market if it evangelized Linux and offered hand-holding migration services in the process. (Author's note: It would be somewhat Shakespearian to think that a combination of IBM, Lotus and Novell would lead a successful Linux desktop assault.) There's no love lost between Microsoft and Oracle, so I'm sure Larry Ellison could be persuaded to support this effort. Intel and AMD want to sell boxes, so Linux desktops are just fine.
Once there is sufficient market demand, Dell, Hewlett-Packard, Acer, Gateway, Lenovo and the rest of the PC hardware crowd will certainly offer Linux desktop alternatives as well.
Linux desktops can't run applications like iTunes (yet) or support a zillion consumer add-ons, but if your users need basic productivity tools and a browser to be productive, who cares? This is especially true in the developing world, where low cost rules and there is no Microsoft legacy.
There is one last ironic twist in play here. Later this year, Microsoft will throw a $500 million PR and advertising party aimed at convincing users to upgrade their PCs to Vista. This provides a perfect opportunity for the Linux crowd to persuade CIOs to evaluate Linux and compare pricing. In this way, Microsoft will likely open the door to some unintended Linux desktop momentum.
I have every expectation that Vista will be a much better OS than XP, but do users really need it? Perhaps. Then again, many CIOs may conclude that the more prudent choice would be a Linux desktop and Open Office migration offering good enough functionality, at 10 percent of Microsoft's price.
Jon Oltsik is a senior analyst at the Enterprise Strategy Group.
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