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Linux Business

The Linux Uprising 406

Posted by michael
from the when-penguins-attack dept.
ballpoint writes "Business Week is featuring a list of articles under the header 'The Linux Uprising' including topics like 'Red Flags for Red Hat' and 'A Bad, Sad Hollywood Ending?' touching everything dear to the Slashdot community. A good read to align yourself with what mainstream businesspeople are fed."
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The Linux Uprising

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  • by Anonymous Coward on Friday February 21, 2003 @03:55PM (#5355688)
    A good read to align yourself with what mainstream businesspeople are fed.

    I could sure go for a tasty steak right now! I know business people eat steak a lot... mmmm... steak!
  • by jpsst34 (582349) on Friday February 21, 2003 @03:55PM (#5355689) Journal
    No time to read the articles, just gimme the jist.
    • by frodo from middle ea (602941) on Friday February 21, 2003 @04:14PM (#5355891) Homepage
      The jist is,
      You can no longer play the "blame it on Microsoft game". You have to get up your lazy a$$ and do some research before recommending a m$ product next

      Coz, next time you recommend a m$ solution, chances are your customer will ask ..Whats this linux thing We are hearing about ?

      And if you say , "Oh its just some geeky thing used by hackers ." Chances are they might ask, "Oh yeah then how come IBM and HP and so many other big guns are supporting it ?"

      • by Tim C (15259) on Friday February 21, 2003 @07:16PM (#5357573)
        In my experience, the only time the customer cares, is when they specify Microsoft. I've worked at my company for 4 years now, and every client I've heard express a preference, has wanted MS. The rest (the vast majority) don't care how we do it as long as they get the website they want.

        Java, C, PHP, ASP - they couldn't give a toss. Well designed site that works and lets them sell things/get their prescence on the web, that's what they care about. The choice of technology is irrelevant - in fact, that's what they're paying us for.
    • by Spy Hunter (317220) on Friday February 21, 2003 @04:43PM (#5356201) Journal
      Here's the gist: Linus Torvalds is married to the six-time women's karate champion of Finland! [businessweek.com] Bill Gates better not try to mess with Linus!
    • Re:the gist is... (Score:5, Informative)

      by tomhudson (43916) < ... <nosduh.arabrab>> on Friday February 21, 2003 @05:30PM (#5356734) Journal
      they don't know what they're talking about, again.

      Here's one stupid quote...

      Before using open-source software, tech companies must sign a license in which they promise to give away innovations they build on top of it.

      I guess they should have a sit-down with RMS first...

      • Re:the gist is... (Score:4, Insightful)

        by GlassHeart (579618) on Friday February 21, 2003 @08:17PM (#5357908) Journal
        Here's one stupid quote...

        "Before using open-source software, tech companies must sign a license in which they promise to give away innovations they build on top of it."

        How is it stupid?

        One, free software are free to use. It's just when you make derivative products from it where you come into contact with the GPL.

        Two, not all free software are GPLed. Some significant examples, in fact, form the core of successful commercial products.

        Three, there's nothing to actually sign. However, the effect is similar, so we can probably overlook that.

        Four, "giving away your innovations" is a little oversimplified. It's theoretically possible that a competitor just downloads your sources, improves it a bit, and ships, but see how the best example of this - early versions of Mandrake - is near death but Red Hat is thriving.

        The reason I'm bothering to list all of this on Slashdot is that this is, in fact, a bit nuanced, if not confusing. Is it possible that our political fervor is undermining us? Everything wrong with this statement comes from misunderstanding the GPL.

        Look at Apple. They used BSD code, and are contributing their changes back even though they don't legally have to. They do that for good PR and for the potential of getting "free" bug fixes. In this case, free software is beneficial to all parties involved. I guess RMS never thought that would actually happen (without being legally required to by license). Perhaps relying on the fact that open source is good development practice is enough?

        Visionaries as some of these prominent folks are, they've unfortunately "hijacked" the word "free" and made it so confusing that mainstream journalists cannot understand it anymore. They may be "stupid", but are we getting too smart for our own good?

  • by kevinvh (652481) on Friday February 21, 2003 @03:56PM (#5355698)
    Guess Business Week's next story will be about the dramatic increase in the stock price of companies that manufacture Suspenders..
  • Quick! (Score:3, Funny)

    by gearheadsmp (569823) on Friday February 21, 2003 @03:57PM (#5355708)
    grab your torch! I need help storming AMD's HQ to "convince" them they need to release the Athlon64 now, and not on Microsoft's timetable. Think more favorable Businessweek articles.
  • A bit dramatic? (Score:4, Insightful)

    by Anonymous Coward on Friday February 21, 2003 @03:57PM (#5355711)
    You read the first paragraph of the article and you get the impression of Linus, Alan and RMS just limping down the road with a torn GNU/Linux rampart and whistling the *nix equivalent of Yankee Doodle. Not really a bad picture but what's the *nix equivalent of Yankee Doodle?
    • but what's the *nix equivalent of Yankee Doodle?

      I don't know about *nix in general, but for GNU/Linux this [gnu.org] is probably appropriate...
    • by kfg (145172) on Friday February 21, 2003 @05:57PM (#5356979)
      A Better Model by Steven Levine at Apollo Computer
      Submitted by "Spam"
      Sung to the tune of "A Modern Major-General"
      by Gilbert and Sullivan

      I've built a better model than the one at Data General
      For data bases vegetable, animal, and mineral
      My OS handles CPUs with multiplexed duality;
      My PL/1 compiler shows impressive functionality.
      My storage system's better than magnetic core polarity,
      You never have to bother checking out a bit for parity;
      There isn't any reason to install non-static floor matting;
      My disk drive has capacity for variable formatting.

      Chorus:
      His disk drive has capacity for variable formatting,
      His disk drive has capacity for variable formatting,
      His disk drive has capacity for variable format-formatting.

      I feel compelled to mention what I know to be a gloating point:
      There's lots of room in memory for variables floating-point,
      Which shows for input vegetable, animal, and mineral
      I've built a better model than the one at Data General.

      Chorus:
      Which shows for input vegetable, animal, and mineral
      He's built a better model than the one at Data General.

      The IBM new home computer's nothing more than germinal;
      At Prime they still have trouble with an interactive terminal;
      While Tandy's done a lousy job with operations Boolean,
      At Wang the byte capacity's too small to fit a coolie in.
      Intel's mid-year finances are something of the trouble sort;
      The Timex Sinclar crashes when you implement a bubble sort.
      All DEC investors soon will find they haven't spent their money well;
      And need I even mention Nixdorf, Univac, or Honeywell?

      Chorus:
      And need he even mention Nixdorf, Univac, or Honeywell?
      And need he even mention Nixdorf, Univac, or Honeywell?
      And need he even mention Nixdorf, Univac, or Honey-Honeywell?

      By striving to eliminate all source code that's repetitive
      I've brought my benchmark standings to results that are competitive.
      In short, for input vegetable, animal, and mineral
      I've built a better model than the one at Data General.

      Chorus:
      In short for input vegetable, animal, and mineral
      He's built a better model than the one at Data General.

      In fact when I've a floppy of a maximum diameter,
      When I can call a subroutine of infinite parameter,
      When I can point to registers and keep their current map around,
      And when I can prevent the need for mystifying wraparound,
      When I can update record blocks with minimum of suffering,
      And when I can afford to use a hundred K for buffering,
      When I've performed a matrix sort and tested the addition rate,
      You'll marvel at the speed of my asynchronous transmission rate.

      Chorus:
      You'll marvel at the speed of his asynchronous transmission rate,
      You'll marvel at the speed of his asynchronous transmission rate,
      You'll marvel at the speed of his asynchronous transmission-mission rate.

      Though all my better programs that self-reference recursively
      Have only been obtained through expert spying, done subversively,
      But still for input vegetable, animal, and mineral,
      I've built a better model than the one at Data General.

      Chorus:
      But still for input vegetable, animal, and mineral,
      He's built a better model than the one at Data General.

      KFG
  • by sidvishus9 (652515) on Friday February 21, 2003 @03:57PM (#5355716)
    I think it's pretty funny how everybody is trying to make this whole topic into a "underdog is always the good guy" Rebel Alliance versus Evil Empire thing. I think once mainstream people understand that big businesses use linux, lots of it's out-of-the-way appeal will be lessened.
  • by macshune (628296) on Friday February 21, 2003 @04:01PM (#5355760) Journal
    "Second, Intel Corp., the dominant maker of processors for PCs, loosened its tight links with Microsoft and started making chips for Linux. This made it possible for corporations to get all the computing power they wanted at a fraction of the price."

    Specialized linux chips? Why didn't I see this posted on /.???? This is possibly the biggest story this year!

    • by Dman33 (110217) on Friday February 21, 2003 @04:21PM (#5355966)
      Me: Read this article on Business Week... it outlines the history of Linux and it's increasing presense in corporate America, at least on servers...

      PHB: Intel chips for Linux? No way! I would rather pay the licensing for Win2k Server than replace all of the hardware with special Linux chips that I have never heard of!

      Me: Linux chips? Wait... Mmmmmm... chips. Mesquite chips.... or salt-vinegar chips.... okay, going to the cafeteria... you need anything?

      PHB: No thanks.

      No wonder nothing ever gets done around here....
    • Re:Chips for linux? (Score:5, Informative)

      by Skyshadow (508) on Friday February 21, 2003 @04:31PM (#5356074) Homepage
      I think that particular error provides you with a fairly accurate yardstick with which to judge the rest of the reporting in the articles.

      IMO, you have to be pretty close to any given industry to really understand it and even closer to try and draw conclusions as to what the future looks like. There's no way that you can get that close to more than one or two industries, so turning out an insightful article about a new industry for a magazine each month is a bit of a joke. So, these reporters are left looking at the tea leaves of the businesses they're reporting on -- the profit numbers, the growth rate, etc.

      The more important data is beyond their grasp. For instance, I know that the advanced server and subscription update models are good because, even though I'm an old-school linux guy, I use them and find them valuable, esp. if my company's paying for them. I know that when I look on the desktops of the people who are making buying recommendations, I'm seeng Red Hat systems running as desktops. I know that in meetings, we make buying decisions for products based partly on how they support Linux.

      None of this is available to these guys, which is why in the long term their advice in this (as well as many other) catagories is essentially worthless -- all they can do is point out the obvious, like "not making phone companies share will hurt DSL companies dependant on that sharing"... Gee, thanks.

      Besides, if you knew how to play the market with any great degree of proficiancy, would you waste your time publishing a magazine?

      • all they can do is point out the obvious
        is far from useless if it wasn't obvious to the reader.
        O.T. Sounds like you're a couple of years ahead of the curve, so please be kind to those of us trying to play catch up.
    • by IamTheRealMike (537420) <mike@plan99.net> on Friday February 21, 2003 @05:00PM (#5356434) Homepage
      That's cute, but I'm waaaaaaay more concerned about this part:

      Before using open-source software, tech companies must sign a license in which they promise to give away innovations they build on top of it.

      WTF? That has to be one of the more dangerous pieces of bad reporting I've seen lately. Not only is it utterly inaccurate (you don't have to sign anything to use open source software), it also hopelessly confuses "code" with "innovation".

  • you can see for yourself that the article is so shallow: Here is a quote in the context of why linux is becoming popular: "Second, Intel Corp., the dominant maker of processors for PCs, loosened its tight links with Microsoft and started making chips for Linux. This made it possible for corporations to get all the computing power they wanted at a fraction of the price. "
    • started making chips for Linux.

      We all know this is just the journalist being ignorant but the the Meme has value. Intel is hardcore business and having PHBs thinking that Intel has committed resources to a Linux Chip is worth quite a lot.

      The irony is that AMD actually is a bit close to this as present time, with the x64 for desktop being delayed due to MS not ready. The initial OS for the chip is Linux. (AIX??)

  • by macshune (628296)
    "Frustrations, though, run high. One Microsoft executive, chief strategist Craig Mundie, even calls Linux unhealthy for the technology industry. "It ultimately is a question about whether societies are going to value intellectual property or not," he says."

    No, they don't! Evidence: Napster, Kazaa, et al. Casual piracy in the workplace. Mix-tapes. etc.

    • Keep reading... (Score:3, Insightful)

      by schon (31600)
      Right after that quote is probably the largest piece of FUD I've ever seen:

      Before using open-source software, tech companies must sign a license in which they promise to give away innovations they build on top of it.

      WTF?!?!

      I've been using open-source software for years, and I've never signed anything like this.
    • Re:survey says? (Score:4, Interesting)

      by ackthpt (218170) on Friday February 21, 2003 @04:39PM (#5356152) Homepage Journal
      "Frustrations, though, run high. One Microsoft executive, chief strategist Craig Mundie, even calls Linux unhealthy for the technology industry. "It ultimately is a question about whether societies are going to value intellectual property or not," he says."

      No, they don't! Evidence: Napster, Kazaa, et al. Casual piracy in the workplace. Mix-tapes. etc.

      I'm waiting to hear how many people at the Redmond campus have been busted for using Napster or Kazaa. It's simply too much to expect of the 10,000 people Microsoft employs that all 10,000 are above photocopying magazine articles, giving tapes or CDR's to friends, downloading TV or Movie shows off the internet, or lifting the odd bit of code from someone else's project to insert into their own. Heck, even the British government has done such. [greenleft.org.au] I wonder what St. Mundie has in his closet.

  • Art (Score:4, Interesting)

    by drooling-dog (189103) on Friday February 21, 2003 @04:08PM (#5355817)
    I like the Bruce Perens interview, Programmers are like Artists, where he explains the motivation behind open source from a developer's viewpoint. Imagine you're a talented painter, but the only way to make a living at it was to work on a corporate art assembly line, where each artist is responsible for a few specific brush strokes in a particular color (which is actually how "starving artist" paintings are done). Of course you'd be working on your own canvases in your spare time, and giving them away if that were the only way to be seen.
    • that contains beauty. Programming is very artistic if you look at it from the right perspective. (Perhaps the obfusicated coding contest is a bad example :)

      This is the motivation behind many OS programmers. The people who love to code are the ones who don't need money to do it. They code because they love to.
    • I'm a bad boy (Score:3, Informative)

      by Bruce Perens (3872)
      I said intellectual masturbation href="in business week [businessweek.com]. They sanitized it for the print version. :-)

      Bruce

      • they put it back. (Score:3, Insightful)

        by Erris (531066)
        If it ever was in the memory hole, it's back now:

        Q: It seems strange that social and psychological factors are more important incentives for creating open-source software than money.

        A: I worked for Pixar for 12 years. During those 12 years, every piece of software I wrote, except for one, hit its end of life before I left the company -- the projects were canceled or never deployed. Nothing survives. Now, programmers are like artists. They derive gratification from lots of people using their work. Writing software that just gets put away feels like intellectual masturbation. All of the good comes from someone else participating.

        I'm glad that you were not refering to the efforts of free software writers. Who'd have ever thought of a bunch of softies as wankers? I'll leave that piece of filth about the de-bugger alone as they might be against the law in Southern California.

        Not so bad at all really. A better analogy, and one I can tell my daughter, would be to compare such work with an Egyptian Slave's job. You eat and work on beautiful objects but your work is secret and in the end it gets locked up in a tomb with a dead man and perhaps yourself never to be seen again by anyone you know or care about. Not very satisfying at all, especiall when you cosider that your work is paid for and props up the nasty structure that enslaves everyone you know. Nah, jerk off works better.

        "The Raw, the Cooked and the Half Baked" why does that ring a bell?

  • Linux IS mainstrem (Score:5, Insightful)

    by argmanah (616458) <argmanah@@@yahoo...com> on Friday February 21, 2003 @04:09PM (#5355834)
    The only thing bothersome with the articles is the idea that Linux is still something that's "rebellious". It's not. No, it doesn't have the market share that some of the other operating systems out there has (ahem), but just because you're not #1 in market share doesn't make you a niche technology. Linux IS mainstream. It's proven itself time and time again.

    Just because Ford (or whatever car comany) has market share, it doesn't make my buying a Honda "rebellious". It just might be the choice that fits my needs better.

    Executives need to know that Linux isn't a rogue OS. It's a choice you can make that provides different features. For those whose requirements would be better by Linux, they need to know they are simply making another mainstream choice.

    Business Week needs to catch up to the present.
    • by asv108 (141455) <alex@phata[ ]o.org ['udi' in gap]> on Friday February 21, 2003 @04:20PM (#5355963) Homepage Journal
      Linux is certainly mainstream, but the process behind Linux (OSS) is certainly not mainstream, especially to a business audience, hence the "rebillious" description.
    • by QwkHyenA (207573)
      Couldn't agree with you more.

      However! we're dealing with BUSINESS MAJORS!

      These are the folks that thought classroom attendance was optional and a 'C' on the ole report card stood for 'Cool!'

      If the editors hadn't used words like 'rebellious' & 'radical' they wouldn't read the articles!

      Why??

      Cause there's something shiny ...right..Over....There...

      That distracts them!

    • ...who repeatedly paint themselves as heroic rebels fighting against the Evil Empire. That's how they want to be seen, and they try to get as much attention as they can. Slashdot, unfortunately, is infested with them.

      I don't want to be too negative about it, though. Some of the attention they've brought to Linux has probably been good for attracting resources, though I worry that some has probably scared away resources, too.

      A lot of us Linux users don't see ourselves as activists battling anybody. We just use it because we like it, not because we hate some Evil Empire. We don't get much press, though, because we're surrounded by noisy "M$ sucks!" activists screaming for attention.

  • by kevinvee (581676) <ktvaughaNO@SPAMunity.ncsu.edu> on Friday February 21, 2003 @04:10PM (#5355836)
    ... since the volunteer programmers often lack specialized knowledge, complex business applications are probably beyond their range. But basic open-source databases and e-mail are already available.
    Beyond the obvious argument about specialized knowledge, I'm really interested in this complex business application they call "e-mail." Has anyone else heard of this? I hear It's making waves through the internet.
  • by Nikk Name (649179) on Friday February 21, 2003 @04:10PM (#5355843)
    It all boils down to the mascots. Right now, the Linux symbol is a cute cartoon penguin.

    For Microsoft, the symbol right now is a fat guy in a skintight butterfly suit.

    Now, which mascot is more appealing?

    • Well, the truly funny thing is I hear that fat guy in the MSN commercials actually runs Linux at home.. And I'm pretty sure I read some posts of his here on /. under the name ButterflyBoi4u..
  • The Linux Uprising? (Score:3, Interesting)

    by macshune (628296) on Friday February 21, 2003 @04:11PM (#5355846) Journal
    Mildly off topic I know, but it's strange when events like open-software gaining acceptance in the marketplace are called 'uprisings'(as though open-source programmers are so terribly disenfranchised) while real uprisings, like the 'L.A. riots' that happened in part to bring about social change for increasingly disenfranchised and marginalized groups have less grand language applied to them (e.g. 'riot').
  • gross margins (Score:5, Insightful)

    by InodoroPereyra (514794) on Friday February 21, 2003 @04:12PM (#5355858)
    An interesting figure from one of the articles [businessweek.com]:

    It will be hard to replace the 50% to 80% gross margins of the software business with the 20% or less gross margins typical for software-service companies.

    This is the main issue in open source: using open software for your business is a no-brainer (unless there is no open source solution for your problem), however developing open source software and making a living out of it is not easy. I am not saying it is impossible, it is just pretty difficult.

    I have the feeling that the next main contribution to Free/Open Source Software will come from a business person, not from a developer. We need to find a way so that people can make money producing (as opposed to "using") free software, without compromising the spirit of free software.

    • You say that using open source is a no-brainer and developing it is the problem. The problem is that's not what this quote says. The problem is finding support for your software products. Buisnesses don't care whether people can make a profit with open source, all they care about is getting the product, and support for it. To some extent they can now get the product, but for many things they can't get the support.
    • Re:gross margins (Score:3, Insightful)

      by auferstehung (150494)
      This is the most enlightening/enlightened question/answer in the whole Peren's interview and goes to the heart of the question of how to make a living off of Free/Open software without compromising the spirit.

      Q: Why do companies that use software participate in open-source projects, given that they're contractually required to make public whatever improvements they make to it?
      A: It works better than consortia. Companies have poured millions into consortia to develop software standards. But they always go down in flames. And open-source projects win over and over again. Why? It's because open-source licensing makes things fair for all the partners. In the consortium projects, there's always the handshake with one hand and a dagger in the other.


    • Re:gross margins (Score:3, Interesting)

      by Anonymous Coward

      It will be hard to replace the 50% to 80% gross margins of the software business with the 20% or less gross margins typical for software-service companies.

      20% gross margin? Christ, there are businesses that would KILL for 20% margins. What is so special about Microsoft (and that's who we're talking about) that they can make 80% profit margins??

      In my economics classes I learned that in perfect competition, profits are driven to zero in the long run. Why is the software industry so messed up??

    • Re:gross margins (Score:5, Interesting)

      by IamTheRealMike (537420) <mike@plan99.net> on Friday February 21, 2003 @05:29PM (#5356729) Homepage
      We need to find a way so that people can make money producing (as opposed to "using") free software, without compromising the spirit of free software.

      I don't think that's so hard.

      Software isn't perfect. It's practically guaranteed that somebody, somewhere, is right now cursing some piece of softare. Maybe it's buggy, perhaps it's missing a feature they want. Maybe it costs so much they can't afford it. Maybe it's obsolete.

      If all software in the world was under the (L)GPL, we could stil make money, by eliminating imperfection. Let's say I need some cash. OK, so I go bug hunting. A quick bugzilla query... what features have the most votes? Hmm, this one is pretty popular. It's a lot of work, and the maintainers are busy with other stuff. It's not got done. There are 200 votes. I think it'll take me a month. If each one of those people who voted chips in £5, that's £1000 for a months work, not bad at all.

      They won't all pay of course, but if you state that you need £1000 for the feature, then the people who really want it will pledge money for it, and the ones who thought it'd be neat but don't care enough to pay will just wait it out. Eventually it'll get there.

      Because, the model we use currently is actually very inefficient. Companies attempt to predict what all their customers want, and then write the code, and then sell it. What if really their customers wanted something different? Your shafted. Worse, because the culture is that you don't pay for bugfixes, new features are constantly introduced, with little thought given to whether they are actually useful or not.

      So, freelance work on free software is more efficient. The example I gave above is less likely than a business saying "I need the software to do X, how much will it cost" - it's more efficient for them, because they only pay for what they need, and it's more efficient for us, because everybodies contributions are lumped together and we can all co-operate.

      I call it the bounty hunter model, you hunt for bounty. Maybe a company wants you to port their apps to Linux using WineLib. Maybe a film company needs a new feature in the Gimp. Maybe an ISP is concerned about the security in the networking stacks and wants an audit.

      And for new projects? Well, that's what volunteers are for :) Whatever. Basically the 80% of people that work in software services becomes 100%. I think it's workable.

  • When I first saw the title "Red Flags for Red Hat", I first thought they were referring to this [kuro5hin.org]

    Turns out, it's just talking about how they don't make much money.

    • by bwt (68845) on Friday February 21, 2003 @08:23PM (#5357945) Homepage
      Actually, they are doing amazingly well. Given that they just had an IPO a few years ago and that the US is in a recession, the fact that they basically break even can only be considered exceptional. Red Hat's stock has outperformed the S&P over the last 2 years. They are a very well run company.
  • by auferstehung (150494) <moc.liamg ieb gnuhetsrefua.dnu.dot> on Friday February 21, 2003 @04:12PM (#5355863)
    Open-source software programmers say they're different from Stallman in one major way: They don't have a problem with people making money off their work--or making money themselves.

    Implying that Free Software has a problem with people making money which isn't the case given:

    Since "free" refers to freedom, not to price, there is no contradiction between selling copies and free software. In fact, the freedom to sell copies is crucial: collections of free software sold on CD-ROMs are important for the community, and selling them is an important way to raise funds for free software development. Therefore, a program which people are not free to include on these collections is not free software.

    found here. [gnu.org]

    It might be said that Free Software has a problem with how you go about making money off of software not the fact that you do.
  • by Jack Comics (631233) <jack_comics@@@postxs...org> on Friday February 21, 2003 @04:16PM (#5355914) Homepage
    Here's a quote from one of the linked articles that I think sums up what most Linux advocates fail to realize:

    "The revenue growth isn't particularly impressive," says Paul McEntire, portfolio manager of the Marketocracy Technology Plus Fund (TPFQX ), which has owned the stock in the past. Moreover, he says, Red Hat's financial results don't persuade him that it can be solidly profitable in the future. Mostly, he worries that it would take only a little price competition from Microsoft (MSFT ), which goes up against Linux in the operating-system market, to see the return of red ink. Notes McEntire: "Microsoft hasn't really responded to the Linux threat yet."

    Should Microsoft ever truly respond to the Linux threat, say by slashing their prices of Windows XP/Windows 2003/Windows Whatever in half, and slash the prices of Microsoft Office in half (much as they have already done in a recent promotion for Apple Macintosh users), it's game over for Linux on the desktop. Xandros is $100. LindowsOS is $130. Hardly anyone would be willing to switch to Linux, when for just $20-$50 more, they can buy the latest and greatest version of Windows, and avoid that steep learning curve and lack of "critical applications" that Linux tends to bring.

    I especially see this coming as the other divisions of Microsoft, such as MSN and the XBox, while still losing money, are not losing as much money as they used to, and thus Microsoft would no longer have to rely on Windows and Office as their cash cows so much as they have done in the past.

    • Should Microsoft ever truly respond to the Linux threat, say by slashing their prices of Windows XP/Windows 2003/Windows Whatever in half, and slash the prices of Microsoft Office in half (much as they have already done in a recent promotion for Apple Macintosh users), it's game over for Linux on the desktop. Xandros is $100. LindowsOS is $130. Hardly anyone would be willing to switch to Linux, when for just $20-$50 more, they can buy the latest and greatest version of Windows, and avoid that steep learning curve and lack of "critical applications" that Linux tends to bring.

      I think you're completely, 100% wrong.

      The only way your logic works is if cost were discouraging people from buying Windows, giving rise to the assumption that the cost of Windows is what's pushing people to Linux. In response to this, I would point out that 99.95% of personal computers sold are done so *with Windows already bought, paid for and installed*.

      Besides, pretty much everyone out there operates under the basic assumption that they'll have to pay some money for an OS or Office software. We don't really think about it anymore -- sure, we might bitch when it costs $100 to upgrade to the latest and greatest version, but for most people that's not a deal-breaker.

      No, the real battlefield is functionality. Sooner or later, Linux is going to blow past MS in terms of user experience due simply to the fact that they can pick-and-choose which bits to emulate (fast-launching browser in, annoying Clippy and friends out). At that point, it won't matter if MS gives away Windows because nobody'll want it anyhow. The only way they'll survive is if they can consistantly innovate new, useful features at a reasonable price to stay ahead of the curve, something which MS has *never* been able to do.

      So, MS will have to flee off the desktop to other things the OSS community doesn't do well -- game development, console systems, etc. There, they'll have to compete in a far more level playing environment and will in the long term probably get their monopolostic asses handed to them by smaller, faster companies.

      How can I predict this? Because that's how things work with most industries which don't exist as regulatory monopolies. I don't see software being any different -- in fact, I predict the decline of MS on the desktop will come so quickly that if you blink you'll miss it.

    • by IamTheRealMike (537420) <mike@plan99.net> on Friday February 21, 2003 @05:12PM (#5356552) Homepage
      Should Microsoft ever truly respond to the Linux threat, say by slashing their prices of Windows XP/Windows 2003/Windows Whatever in half, and slash the prices of Microsoft Office in half (much as they have already done in a recent promotion for Apple Macintosh users), it's game over for Linux on the desktop. Xandros is $100. LindowsOS is $130.

      Well.... not really. One of the strongest desktops around is Redhat 8, which is free. You can't get cheaper than free. Also, remember the reason those distros are so expensive - proprietary NTFS resize code and CrossOver. As of about 4 days ago, we have stable open source NTFS resizing. That slashes quite a bit off the price. Xandros is already selling a version without CrossOver that comes in at a far more reasonable price.

      Regardless, just because some companies charge a lot for Linux now, doesn't mean that this is what Linux costs. The fact is that Windows could be given away for free, and it wouldn't hurt Linux one bit in terms of development speed - how many free software hackers do you know who do it because they are too poor to buy Windows?

    • by SysKoll (48967) on Friday February 21, 2003 @05:31PM (#5356745)
      Mostly, [Paul McEntire] worries that it would take only a little price competition from Microsoft (MSFT ), which goes up against Linux in the operating-system market, to see the return of red ink.

      McEntire doesn't get it.

      Most of the Linux distro revenue comes from professional servers and technical workstation users who want paid support. These users couldn't care if MS gave away their products. They would consider switching to, say, IBM's AIX or Sun's Solaris if the price was right and the apps available. But not to Windows.

      The fact that this guy is not aware of this simple market reality and yet manages a stock portfolio is really scary. Keep away from his Marketocracy Technology Plus Fund.

      Now, on another hand, your argument about Linux on the desktop makes much more sense:

      I especially see this coming as the other divisions of Microsoft, such as MSN and the XBox, while still losing money, are not losing as much money as they used to, and thus Microsoft would no longer have to rely on Windows and Office as their cash cows so much as they have done in the past.

      Now that's a valid argument. It would not hurt the server sales but it would certainly hurt the Linux desktop numbers.

      However, keep in mind that Microsoft depends on the value of its stock in order to retain employees with stock options. Now take a look at MS'S SEC filing [sec.gov], especially Note 9, "Segment information". Their operating systems and applications account for more than 86% of their sales income (financial activities excluded). The other divisions, entertainment and consumer electronics, are barely showing up on the radar screen. Even if they were profitable, they really couldn't scale up to the Office+Windows income. A sustained price cut on Windows and Office would hurt MS's income very badly, send their stock price down, and bring down their option-based financial Ponzi scheme. So they just cannot afford to do it.

      See Bill Parish's report [billparish.com] for an overview of MS's financial pyramid. Recommended reading to understand what makes the Redmond Beat tick.

      -- SysKoll
    • Moderators!

      Why is the parent post rated so high?

      I think the parent poster does not understand linux. Linux will not just disappear because of competitive pricing. Linux would not disappear even if someone purchases every Linux distribution out there.

      Linux is the result of people interested in creating and sharing information, regardless of the prices or costs of alternative operating systems.

      I think, if Linux or free software some how relied on money/market share/stocks/etc it obviously would have failed so far.
    • Should Microsoft ever truly respond to the Linux threat, say by slashing their prices of Windows XP/Windows 2003/Windows Whatever in half, and slash the prices of Microsoft Office in half (much as they have already done in a recent promotion for Apple Macintosh users), it's game over for Linux on the desktop.,/P>

      That's ridiculous. If Microsoft slashes Office and Windows prices in half you wouldn't believe how quickly Wall Street would abandon their stock. Reducing prices to compete is a loser's strategy and bound to fail in the long run. Let's presume that Red Hat and Xandros go out of business (despite the fact that Red Hat has a big service revenue business). IBM and Sun, tasting the blood in the water, would buy them and match Microsoft's price drops dollar for dollar. Who do you think can go on without making much profit longer, the open source world or Microsoft? IBM could sell Red Hat software at a loss for decades as long as they kept pulling in the big bucks in service revenue. Microsoft has no such luxury. Once they slash the prices of their major products they will be hastening their own demise.

    • Except that some of us actually *prefer* Linux and won't switch to Windows no matter how cheap it gets.
  • So was google (Score:5, Insightful)

    by pb (1020) on Friday February 21, 2003 @04:19PM (#5355947)
    Although you'll also see articles like this [vnunet.com] out there.

    I thought the "Red Flags for RedHat" article was actually pretty good--after all, investors are cautious now, and for good reason; also, Linux distributions haven't been making money, especially when compared to sales of other server operating systems, and a lot of people are looking at the bottom line now, after getting burned.

    So, yeah, RedHat is a great company with a solid product... but always, always do your research first. I think that's a very responsible position to take. If you believe in RedHat, buy some stock--but don't bet the farm on it, especially if you might need that farm someday.
  • Pretty weak... (Score:5, Insightful)

    by Skyshadow (508) on Friday February 21, 2003 @04:21PM (#5355968) Homepage
    I read over the "Red Flags for Red Hat" article, and I have to confess I found it pretty weak.

    The notion that a company which went from a $2m loss to a $300,000 profit, which has a clear majority in terms of install base and which is the only company making money in its segment is headed for trouble seems like seriously flawed thinking to me.

    It seems pretty clear to me that Red Hat has the rare gift of competent management. Maybe RH isn't going to see a big pop in the next quarter, but it's hard to see how the "next five years" view isn't looking pretty rosy. I don't see the fact that it's not back to it's stupidly high .com-era stock price as any sort of a reasonable warning sign.

    Anyhow, I own a couple thousand dollars worth of RH shares, so maybe I'm just believing what I want to.

    • It didn't say that the company is weak, just grossly overvalued for a unprofitable company. But, if I were you, I'd kiss those few grand goodbye.
  • by airrage (514164) on Friday February 21, 2003 @04:21PM (#5355973) Homepage Journal
    THIS ARTICLE IS SPECIFICALLY DESIGNED TO BE VIEWED BY ADULTS AND THEREFORE MAY BE UNSUITABLE FOR CHILDREN UNDER 17. THIS ARTICLE CONTAINS ONE OR MORE OF THE FOLLOWING: PROVOKING THOUGHTS (PT), EXPLICIT SARCASM (ES), OR CRUDE INDECENT SPELLING (S).

    Why don't things evolve?

    I keep thinking about the space shuttle, and open-source, and Microsoft; also of tiny winged dinosaurs recently found in the Mongolian Highlands. All these controversies and discoveries start me thinking -- but mostly the dinosaurs. Why did those little dinosaurs sprout wings? What was the point? Don't they know that was a greater wind resistance drag, making it even harder to escape predators? Why did the space shuttle, built in 80's never upgrade? One could talk of the government and the fact that they never, ever, upgrade unless it's tanks or grenades. But the space shuttle, with it's aging tape-to-tape flight computers, and it's spray on foam insulation, and it's glued on tiles -- why evolve to serve this niche, then never evolve? Was it laziness, stupidity, or some perceived fecundity that we've reached the promised land?

    I can feel there is a tipping-point here, some wisdom I'm about to understand, and yet it eludes me. Back to Microsoft. Why couldn't Novell evolve? Did they think that a different password for everything was better than one password to rule them all? Why continue to chew the prehistoric cud whilst the meteor streaks across the sky - moocow!. Now it's Microsoft, you might argue, that is starting to run a little slower, a little more gamely, who sees the big game cats bearing down in their proverbial rear view mirrors. Will they evolve? Can they evolve? What will they become?

    And so open-source sits too at the precipice, but its penultimate creative spark blew apart at its evolution, splitting into various organisms wading the primordial ooze. Fascinating stuff: evolve now or later, but why not right at the beginning? Evolve on the starting line! It's a pretty awesome strain of thinking. Keep trying to get it right on the starting line -- holding back some DNA -- shooting off ideas that might work. Hyper, hyper-parasitosis. I believe it's the way of informational beings. Even WOPR decided [sciflicks.com] that there might be a better way.

    So why can't Microsoft evolve? I believe they can, but it must happen while, and before, the energy required to evolve is still greater than the remaining energy it has to sustain life. Can they evolve a hybrid, become open-source (you heard it here first!), jump from the abyss, sprout wings, and fly?
  • Perspective (Score:5, Interesting)

    by mao che minh (611166) on Friday February 21, 2003 @04:23PM (#5355996) Journal
    According to the article, Morgan Stanley is saving roughly $25,000 per server over 5 years by moving to Linux. Since it's a financial firm that knows howto account for evey obscure penny saved, this is most likely highly accurate. I have seen reports of German financial companies saving something like 6 million dollars by switching to Linux (over the course of the usual 4-5 year estimate). CGI shops are enthusiastically promoting open source solutions as a means of cutting costs.

    It is amazing that with such astounding real world examples of the cost benefits of open source (not counting all of the other benefits), Microsoft and Sun can still find ways to convince suits that the cost of Linux/open office/etc training outweigh the license and support savings made by dropping Microsoft or Sun. Reports and estimations of rapidly gaining Linux market share always bolster my hopes, but sometimes I just can't see it.

  • by Oriumpor (446718) on Friday February 21, 2003 @04:27PM (#5356028) Homepage Journal
    But if Linux' surge continues, it will be due in large part to the Goliaths of the tech industry. Companies including IBM, Intel, Oracle, and Dell have thrown their weight behind it--and have given the technology credibility with corporate tech buyers


    Ok that's it... people use things cause they're good, and cause they work. MAYBE the reason Linux works is because PEOPLE made it work... and PEOPLE use it.... and corporations are coming in now that it DOES work.... and not back when the kernel would segfault every 5 minutes.....

    People hopping on the bandwagon now, are behind the curve. And some device they use is probably already running it, and they don't know it.

    Now maybe that all these companies are recognizing linux I can get some drivers for my USB camera......
  • This is starting to become a refrain: "I'm glad they like Linux, but their ignorance concerns me."

    My favorite bogus line: Companies invest to create software, sell it, and pour a good part of the proceeds into building more. Pure drivel. As ESR has pointed out, the overwhelming majority of software is never intended for commercial distribution. Companies invest to create software and use it, not sell it. Their investment is much cheaper if they go the open source route.

  • by ins0m (584887) <`ins0mni0n' `at' `hackermail.com'> on Friday February 21, 2003 @04:35PM (#5356114)
    "...A good read to align yourself with what mainstream businesspeople are fed."

    Are you serious? IMO, this looks like FUD. Yeah, they talk about the "Linux Uprising" in the first article, and Tux looks like he's been living under powerlines in the top banner. Yeah, it's a bit of horse puckey how romanticized and incorrect they were in the first article (see: comments on Intel making "chips for Linux", "resentment for Microsoft", and "rotten economy" as reasons for Linux becoming a favored OS). No, they didn't address server benchmark testing or overall gains in stability and performance, but it's excusable....

    Read McNealy's article. Read "Before Linux is on Every Desktop". Touching on embedded Linux? Sun support for Linux for the sake of a *nix OS, and the primary pros that come with such a styled system? From McNealy: "The operating system is still the underlying plumbing on top of which you build the real value-add -- the applications and services to run your business....Linux impacts everyone <in the OS industry>." Coming from a CEO of a very influential company in the tech market, this isn't something to thumb your nose at.

    Yeah, there's FUD in the first article, but you really need to read all the articles before you recommend everyone to do the same with bad expectations.
  • by seelevarcuzzo (625460) <seele&obso1337,org> on Friday February 21, 2003 @04:43PM (#5356203) Homepage
    A good read to align yourself with what mainstream businesspeople are fed.

    in this case, who cares? as little as two years ago the media saw linux as some fly buzzing around bothering the big horses microsoft and sun. now its seen as a more significant player as a viable alternative to the giant expensive software companies.

    The computer realm may never be the same. Imagine the havoc in the energy business if some newcomer started giving away gasoline. Linux is bringing on a convulsion of that magnitude in tech.

    sure, *i* think linux is the greatest thing, and *you* think linux is the greatest thing, but that isnt going to make our boss think linux is a greatest thing. it takes zealous writers who like to think theyre on the cutting edge to write stories which put linux in all its glory. we can then go to our boss and say "look at this.. BUSINESS WEEK even thinks so!".

    two years ago, the business world saw linux as a toy. rehat and ibm have invested alot of money into linux, giving it exposure to more mature audiences than slashdot. now that linux has been out and about for businesses to play with, they realise that "this linux thing is really great". the industry finally sees linux as a threat and is willing to give it the attention it deserves
  • As the tasks home users wish to do become more and more Internet related, the home PC will begin to look more and more like a server. As this trend continues, OS's that are better for servers will become more and more the better choice. Ten years down the road, the idea of a 'desktop' computer will be almost nonexistant. The norm will be a server that runs a desktop-like windowing system. Why do you think M$ is pushing its servers now more than its desktops? Not only because it basically owns the desktop market but also because that, even though its vision of the future is warped and twisted, it still knows where things are headed. And this time it will be IBM that grabs the market.
  • At a trade show in 1998, then-President Steven A. Ballmer referred to Linux, the upstart computer operating system that rhymes with cynics, as "lie-nucks."

    Linus doesn't rhyme with cynics, even when pronounced in the North American version....

    Do people even research their articles anymore? Linux has about 3 different pronounciations that I know of, none of which are "wrong".
    • As Linus said (as told by John "Mad Dog" Hall): "I don't care what you call it as long as you use it."
    • Linux has about 3 different pronounciations that I know of, none of which are "wrong".

      This has been settled by fiat: Linus, original creator of the kernel pronounces it so that it rhymes with cynics. That's as close as you'll come to an official pronunciation for something that is maintained and owned by 10,000 different people, most of whom have never met.

  • by kwiqsilver (585008) on Friday February 21, 2003 @05:22PM (#5356662)
    I was not aware that the FSF was against selling software for profit. Somebody should tell RMS so he'll stop saying he has nothing against selling software. And so the GNU project will stop selling its software.

    I also didn't know Redhat isn't allowed to sell Linux. Does that mean I can get my $40 back from that copy of 6.0 I bought in '99?

    I guess business week will hire fact checkers as soon as cnn.com hires proofreaders...and MS hires QA analysts (call me flamebait, but I couldn't resist the urge).
  • by DunbarTheInept (764) on Friday February 21, 2003 @05:22PM (#5356670) Homepage
    I realize the technical details weren't the thrust of the articles, but that doesn't mean they have to just randomly make things up instead of telling the truth. Look at these quotes:

    Second, Intel Corp., the dominant maker of processors for PCs, loosened its tight links with Microsoft and started making chips for Linux.


    Before using open-source software, tech companies must sign a license in which they promise to give away innovations they build on top of it.



    Since when did Intel start "making chips for linux" (Well, I guess technically ever since the 386, in a way.)

    Since when did the GPL become synonymous with all of open source? (Not that they got the GPL all that accurate in the first place.)
  • by overbom (461949) <(overbom) (at) (yahoo.com)> on Friday February 21, 2003 @05:29PM (#5356730)
    if you read the cringely article about sun from a few days back, the articles here concerning Sun with Scott McNealy do a decent job of responding to some of Cringely's challenges.

    if you want to get a pretty decent picture of what Sun is going to do for their long term strategy regarding linux and the potential downfall of big-iron mainframe UNIX (think GNU/Linux on Polyserve), I think they're looking at sidestepping it altogether.

    They're going straight for Linux on the desktop with the Mad Hatter project -- McNealy makes a lot of sense on this, although it might just be the kool-aide.

    mike
  • Pretty Pictures (Score:3, Insightful)

    by justinburt (262452) on Friday February 21, 2003 @05:31PM (#5356755)
    A lot of the comments I've been reading, and quotations from the article, demonstrate that the writer of the article doesn't really seem to "get it" about nuances of Free Software, etc. (or even basic stuff like Intel building chips "for" Linux).

    But this is pretty typical BusinessWeek - the stories are consistently of a quick glance-over quality, rather than any sort of accurate and/or compelling analysis. If you pick up the print edition you will also notice LOTS of pretty pictures, which is true to the light-on-content feel of most of BW's articles.

    Most businesspeople just read it for a quick glance at emerging issues - so the very existence of the article is a pretty important step, and exactly how accurate the content is is in comparison, for now, somewhat irrelevant.
  • by sawilson (317999) on Friday February 21, 2003 @06:53PM (#5357407) Homepage
    Microsoft is dieing. No trolling intended here.

    Seriously. I mean, this is a story in business week
    predicting their demise basically. How can you stop
    a compeditor that doesn't have bills to pay, or
    debt? I mean, I was worried back in the day. I was
    sure they'd come up with some way of simply taking
    advantage of strong political ties to make Linux
    essentially illegal. That doesn't even matter
    anymore. Money is getting invested. Huge companies
    are in. I used to flat out laugh at the
    "world domination" types on here because it just
    sounded so silly. My argument was always, who
    cares about the rest of the world. How can they
    stop something free? It's turning out to be their
    achilles heel. Microsoft can't buy Linux out.
    Microsoft is moving too slowly to make something
    that can compete on cost. They've spent a fortune
    on trying to market their way out of this
    inevitable approaching death, and people just
    don't buy it anymore. I'm not saying that
    Microsoft will fade into the distance. That's just
    not realistic. But they will have to give up the
    childish name calling and get onboard at some
    point. The sooner they realize they need to give
    up the server market and embrace Linux as much
    as they can, the less money they'll bleed down
    the road. If they don't, they'll lose the server
    market within a short time, then they'll slowly
    lose the desktop market. It's all right there in
    that article. It's what I see. I can't be the only
    one. Imagine all the PHB's reading that going
    "wow, that geeky guy telling me about Linux years
    ago was right. We need Linux now". I don't even
    feel silly saying that. I would have a year ago.
    Scott McNeilly in a Penguin suit speaks volumes.
    It's only a matter of time now.
  • OS delenda est (Score:3, Interesting)

    by ites (600337) on Saturday February 22, 2003 @09:09AM (#5360066) Journal
    It's seemed evident to me for at least five years that Linux will become the commodity OS, much like TCP/IP has become the commodity networking protocol. Anyone still develop for LU6.2, SNA, NetBios, or Novell? It's not a matter of defeating Microsoft, or Sun. It's not a question of price or performance. Linux simply represents a common pool of 'best of breed' technology, good enough but no better, cheap enough but no cheaper, the sweet spot of operating system technology. It runs on every single CPU out there.
    It is a cute spectacle, watching the powers of industry as they debate and decide, negotiate and counter-attack. But the outcome of this particular technological battle was decided the day that Linux was ported to its second CPU after the 80x86. An ecosystem can support one species in a particular niche, and in the OS niche, that is Linux.
    Incidentally, for those monopolists out there, you might want to study the history of such technological movements. Not once has a technology survived that was the exclusive property of one group. Only when the technology was shared so that anyone with the desire could reproduce it, would it become a standard. Make money from proprietary systems while you can, but remember that the moment you stop herding the market your way, you will lose your grip on it.

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