Wal-Mart, Moore's Law and Open Source

J.E. Kazor writes: "In MIT's 'Technology Review' magazine, Michael Schrage writes about Wal-Mart, Moore's Law, and Open Source. Perhaps instead of spending all of our energy bashing bashing the 800-pound gorilla, Microsoft, we should align the support of a 900-pound gorilla, such as Wal-Mart. Such a symbol of cost conscious efficiency should embrace the benefits of Open Source."

Comments

Microsoft the lesser of those two evils

[the_radix]

So, instead of tackling what many people consider a monopoly, albeit a harmless (in the ecological sense) one, one should ally him- or herself with a company that the majority of liberals in this country believe is both an ecological destroyer and a monopoly on a much worse scale?

Microsoft is software, with a dash of hardware, but they are still a high-tech company. Wal-Mart is a retailer that drives many other small local retailers out of business. Considering how easy it is to get high-tech things on the market through the use of the internet, versus the difficulty of being a local merchant, I would call Microsoft the lesser of two monopolies. If Microsoft suddenly used its power to lower all its prices so that other non-free (beer) software companies couldn't compete and went out of business, would you be happier?

Yeah, I chose Microsoft over Wal-Mart. So mod me.

Re:Microsoft the lesser of those two evils

[Nelson]

I think it remains to be seen if Walmart is a monopoly or not. I'd be willing to bet that in a large number of areas where Walmart has a presence in the western US and the midwestern US they are the only source for a large number of products.

They aren't a pure monopoly, but neither is MS, nor was US Steel, or most other monopolies. They are a defacto monopoly in many cases though, just like MS is. The typical Joe 6pack goes and buys a computer, he buys an MS product or a set of them, whether he knows it or not. If you live in rural Kansas or Nebraska or Texas and you need to go buy something, a large percentage of the time it's going to be from walmart, not becuase of cost but because it's the nearest store you know will have the item you wish to buy.

I think the original message hit it on the head with Walmart. If you look at their managment, it's mostly white men, to a startling degree. There have been inqueries and lawsuits around racism and sexism at Walmart. They have a history of union busting, not that I think unions benefit the consumer a whole lot but it's disheartening the know that a corporation has chosen to close a store (a huge part of a local economy) because its employees' political views and associations they may have. And if you take the defacto monopoly business to heart and then realize that they are the only source for music, books, and even medications in some places and then look at what they have chosen to sell and not sell (I'm speaking directly about medication and contraception here, morning after pills, etc.) we're talking about a company that not only has a huge impact on the economy but on the lives of people and how they live them in a lot of places. This is not a company you wish to partner with, I think they make MS look like saints.

Personally, I think the matter of opensource allies is kind of missing the point. We need to keep doing what we're doing. It's not a matter of IBM, Sun, Walmart or E-Trade agreeing to use free software that makes it better or takes it to the next level, those are signs that what's happening is the right thing. This is a community lead effort and if we want things to be better then become part of the community, help out, write code, use it. Looking for allies is passive. If walmart starts using linux, it won't affect or impact any of us any time soon (unless they employ Linus and bully him or something) It might give it more legitimacy but it already has legitimacy and you further legitimize it by using it and working on it. If we work on it and make it better then they will use it becuase it's the best thing to use, that's what's happening elsewhere and that's what undoes the MS monopoly.

Re:Microsoft the lesser of those two evils

[Registered Coward v2]

Wal-Mart is a retailer that drives many other small local retailers out of business.

Wal-Mart doesn't drive stores out of business, ratehr, it's the consumers who chose Wal-Mart over their local stores that cause small stores to close. It's a matter of choice, and many people chose to vote with their pocket book. Wal-MArt often is no cheaper than other chains - in fact, their policy is to price at the competitor's prices and make a greater margin due to lower costs. If a competitor wants a price war, they'll fight back and win, but they typically don't start one.

So how do local stores survive - by offering things, such as service and selection, that Wal-Mart doesn't. I buy video games at a small store - I know the owner, and he tajkes care of me. If a game is junk, he recommends not buying it. When PS2's were hot, he had them for his regular customers - at retail price. If I want a certain used game, he'll hold it when he gets it. Wal-Mart doesn't provide that service, and I'll pay a little more for it. He also beats the big chain rentals by charging less and having reasonable late fees - such as a dollar for one day rather than a full 3 day rental price.

Price isn't everything, and by serving customers who value service over price, small stores can survive. Wal-Mart's real threat is to the Kmarts and Targets - which is why Target went up market and KMart looks like it'll stick to urban locations here wal-Mart can't get space and some Super-K's.

Re:Microsoft the lesser of those two evils

[jtosburn]

This is only true where Wal-Mart has established, large scale competitors.

When Wal-Mart opens a new store, they usually sell many items at a huge loss, ostensibly to draw in new customers. But since many local, small-scale businesses cannot afford to match those below cost prices, they founder and die. Once gone, wal-Mart raises prices. This is called predatory pricing, and is illegal. In that kind of game, the deepest pockets win, which is why when they compete with larger companies (Target et. al.), their prices are similar; they each have enough resources to price match the other for an extended period of time.

Wal-Mart has been found guilty of predatory pricing and fined. But the practice continues. Hence the comment that Wal-Mart drives local, small retailers out of business. They do.

You're right, though, in that one of the real problems is that most people shop to save a buck. They'll drive all over town getting 18 mpg in their SUV because Coke is $0.49 cheaper at Schnucks this week.

Wal-mart is a tough customer

[jACL]

When working for a past employer who sells its merchandise through Wal-Mart, I was exposed to its methods.

As a retailer with Wal-Mart, your product has to maintain a 98% sell-through rate, or you don't sell through Wal-Mart anymore. (This, by the way, says something to me about the Mandrake distro, which still sells at Wal-Mart.) You're required to keep track of the inventory using Retail Link.

Wal-Mart piloted Retail Link across the Internet via VPN in 1995 using Sun's Sunscreen product, prior to the standards even being accepted -- they're a bleeding edge company. Wal-Mart is always keeping an eye on ways to streamline its operation and cut costs. You can bet they've already checked out Linux. If it saves them on operating margins, they'll be ahead of the curve.

quandry

[Alien54]

here we have again a situation where the consequences of a programmer philosophy may at some point clash really hard will political philosophy. A sort of cognitive dissonance, at least for some folks.

what happens when the technology you are promoting is adopted by people you might not like? You know, the whole anti-globalist thing?

Lots of differnt answers to that question.

Get real.

[mindstrm]

Open source hippies. Sheesh.

"Embrace open source?". The hell the should.. just as they should not 'Embrace' any other buzzword or technology. Why? Because to PROPERLY be flexible, you have to look at ALL Your options.

That's the problem with many open source zealots these days. So many of them can't see beyond the purchace price of the software, or the fact that they can hack away at the code. They blab about security.
Open source security? Is open-source a better model for security? In a way.. as anyone who cares to can go have a look at it.. but does that make anything open-source better? No, absolutely not. It's like arguing risc-vs-cisc... someone saying their processor is 'better' because it is risc. In other words, they mix up a technology or methodology being better with an actual implementation being better.

Cheaper? Certainly in some cases. But in others, the cost of windows is NEGLIGIBLE compared to the cost of other tools in use... tools that don't HAVE an open-source equivalent. Tools that have some serious technical support.

I'll advocate free tools anytime... if they make sense. But in many cases, the proprietary stuff IS better, that's reality.

Re:Walmart.. or Big brother?

[dj28]

What? It's their property; They can put as many security cameras as they want on their property just like you can do to your home. They can also CHOSE which music they want to sell. You don't have to shop there. You act like they are forcing you to shop there. Get real. I don't know what moron modded that up.

Given Walmart's current Point of Sale OS...

[Anonymous Coward]

I don't see them converting any time soon. As a former employee of a very large company which provided Walmart all of its Point of Sale equipment, I can tell you that Walmart runs all of its Point of Sale devices on an OS called 4690, which has a shell and set of APIs that look a whole hell of a lot like DOS, while having some nicer things in the kernel like multithreading. This OS has been specifically tweaked and enhanced over the years particularly for these guys, and I can tell you that they aren't going to abandon this OS that has been essentially created for them and for a particular purpose; it is absolutely rock-solid for what it does, granted that that is slim. But I am agreed that Linux would be a great alternative for an emerging Walmart. Many large companies want to run cash registers on wimpy (486 or worse) boxes, which Windows doesn't do so well.

Wal-Mart sells "Naked PC"'s

[mikethegeek]

Wal-Mart is selling PCs without OS's

I submitted this as an article to ./ 2 weeks ago. Rejected. This is a major example of how Wal-Mart could hurt MS.

Re:Wal-Mart and Open Source? Never...

[Anonymous Coward]

You obviously do not work at corporate in arkansas. They already are experimenting with Linux at corporate. If tests go well (most likely they will), they will start rolling out Linux into stores in about 12-24 months.

My understanding is that they are always seeking ways of lowering cost and have realized that staying with an M$ based system would not lower it anymore (high price on OS,sysad, virus protection, software cost, && development productivity ). This is a company that is ALWAYS trying to lower the overall cost / transaction. While they have spent BILLIONS of $ on hardware and software, they have already paid for it. By moving to Linux, they are able to re-use the same hardware. The companies who did not provide Linux based apps to Wal-Mart when they asked once (& only once) will simply not be part of the plan. Apparently, they have in extreme measures of security and most folks do not find out until they are rolling out the products into stores.

As to training, I would think that creating a similar interface for the users would allieviate all that. However, the turn-over rate of employees means that wal-mart is always training employees anyways, so that make that argument simple FUD.

Re:I pay $.77 for gas... thanks Walmart!

[VAXman]

Sure I *love* spending the .91 a gallon I pay for premium fuel, all sparked by a Walmart gas war. They are selling at cost. They have been doing this for the past week. 2 mom and pop stations are now doing the same. I'm sure "the mart" can hang on much longer then mom and pop can.

THE HORROR! I'm sure all those mom and pops like Shell, ExxonMobil, and Chevron are shivering in their shoes. Maybe they'll actually be forced to come up with ways to be more efficient, so they can lower the cost, too, and reduce their own prices.

Walmart, huh?

[filtersweep]

"When it comes to managing high-impact innovation, there is no contest--Sam Walton still matters more than Bill Gates. "

What the article doesn't mention is that many metro and suburban communities VIGOROUS oppose (if not block) the openings of new Walmarts.

There have been huge union issues related to Walmarts the sell groceries.

At a more immediate level, it is downright depressing seeing retirees slaving away minimum wage.

There are a TON of sites about the evils of Walmart:

Walmart Memoirs

Walmart Trash Page

Yahoo stuff

And lest you forget all the censorship that Walmart does regarding music....Censorship at Walmart on Yahoo

I could go on and on about their business practices.

Not to mention that you could hold Jerry Springer auditions at almost any Walmart in the US...

I fundamentally find it ironic that Walmart is used as an example... a very profitable retail chain that is widely hated... that has many questionable business practices... that crushes and destroys the small "mom and pop" retailers in smaller communities.... then again, maybe it is the perfect example?

The facts from a former corporate programmer.

[Anonymous Coward]

I'm posting this anonymously because, well the NDA's are pretty vague as to what I can really say and what I can't....

1. Wal-Mart *DOES* use Opensource

A: About 2 1/2 years ago they started looking at Redhat, about 6 mos later (and I quote the memo that went out, given that's been 2 years ago, but I still remember it) "We will be consolidating our existing Unix Platmforms on Linux", yup, the ISP (In store processors) were to move to Redhat on Quad Dell box (they are btw Dell's largest single customer). I have no idea what the current progress of this is, but given Kevin Turner's (the CIO) statment to "Make Open platforms really Open" I doubt they would turn back on that commitment.

B: Perl. Perl is an offically approved Language to develop on inhouse although we had quite a bit of resistance from certain in-house teams at first.

2. Wal-Mart "going opensource" (as one poster put it) would have little effect on Sun or Oracle. This is because neither are approved vendors. Sun pissed Wally World off years ago and Oracle is deemed to be just too damned expensive (as was MS SQL Server, Informix and DB2 where the only approved databases).

You will likely NEVER see contributions back to the community from Wally World, they simply don't allow that kind of feedback. Remember your talking about the Worlds largest company, that despite the 1700+ Programmers they have in-house, don't even allow regular Internet access from Corporate (certain sites only and no download access regardless).

The author of the article should have done a bit more research on the topic before writing the story. A quick email to president@wal-mart.com would probally get you a better response.

BTW: also remember your talking about a company that does NOT patent it's internal software like many other companies, they view it entirely as trade secret instead (just ask Amazon.com :-) )

Re:Walmart.. or Big brother?

[Cutriss]

Given Walmart's practices of invading cities and eliminating all the mom-and-pop stores, I think I can safely say that they are forcing you to shop there<\QUOTE>.

"Efficiency" really stealing from public good

[michaelmalak]

"Such a symbol of cost conscious efficiency..."

Wal-Mart "passes the savings on to you" by:

1. Importing goods produced by Chinese slave labor
2. Transferring "last mile" distribution costs to customers, taxpayers, the environment, pedestrian safety, ...

This second item bears more explanation:

• Wal-Mart takes from its customers. Customers "willingly" drive farther to shop at Wal-Mart, but usually based on the price of gas (6 cents per mile) rather than the full amortized price of automobile operation, which according to AAA is 51 cents per mile.
• Wal-Mart takes from taxpayers. Wal-Mart generates a lot of VMT (vehicle miles traveled) but doesn't pay for the roads to carry it. Oh, they may pay for an extra lane and signal in front of the store, but not for increased capacity in the several-hundred-square-mile market area.
• Wal-Mart takes from everyone in its market area. VMT by its nature steals from the public good because cars on a per-mile basis don't pay for their negative side effects: air pollution, water pollution (including temperature rises due to impervious surface runoff), noise pollution, increased danger to bicycles and pedestrians.
• Wal-Mart takes from the environment. Besides the environmental concerns due to increased VMT, there are two more. First, there is the runoff from its vast parking lots and large store (during a rainstorm, this suddenly increases the temperature of streams by several degrees, which kills fish since fish cannot tolerate temperature changes the way people can). Second, Wal-Mart makes disposable buildings. Wal-Mart builds its large buildings to last seven years, then leaves them as vacant blighted eyesores as they move to even bigger superstores.

When it comes to Wal-Mart, "efficiency" means "theft" -- not the sort of efficiency that Linux should associate itself with.

The perfidity of Wal-Mart is not the point

[Jack William Bell]

I wish I had some way of marking every "Wal-Mart is evil!" post as offtopic in one fell swoop. Walmart probably is evil to some extent; every large corporation is. But the author's use of Wal-Mart as an example tends to obscure his real point. The key passage in the article is the closing paragraph, quoted here with every instance of 'Wal-Mart' changed to '[Big-Biz]':

Today's economic reality is that high-tech decisions made in Arkansas play a larger role in boosting America's productivity than decisions made in Silicon Valley or Seattle. If you appreciate clever innovations, spend more time with inventors, entrepreneurs and venture capitalists. If you want to know which innovations will rewrite the productivity statistics, ignore early adopters and identify the [Big-Biz] in key vertical markets. Moore's Law is a necessary but not sufficient condition for economic growth; [Big-Biz]'s motto is what makes Moore's Law matter.

Those of you who want to focus on '[Big-Biz]' as evil are obscuring a more important question; can Open Source break into [Big-Biz]? The thing is, computers really have produced a considerable pay-off for [Big-Biz] and small-biz. That is why they use them. In the case of [Big-Biz], however, cost-effictiveness is probably the sole reason they use them. [Big-Biz] doesn't care about the cool factor.

So, if we want to see Open Source grow beyond colleges and a few small-bizs we need to seriously consider how to show [Big-Biz] they can save money by adopting Open Source Tools.

Implicit, but not mentioned explicitily, in the article is the extra question "Can we get [Big-Biz] to adopt the philosophy of Open Source as a cost saving measure as well?" By definition [Big-Biz] wants to make lots of money and to squeeze out their competitors. That kind of behavior is what made them [Big-Biz] in the first place. From their viewpoint you don't squeeze out your competitors by creating great tools and giving them away for your competitors to use against you. We need to find ways to make the argument that the win from this behavior is greater than any possible loss.

However, if you hate [Big-Biz] because you hold anti-capitalist views, then you should also be against helping them to understand Open Source. Personally I think that kind of stance is both quixotic and wrong-headed. But you should be clear in you purposes.

Jack William Bell

Re:and another thing they sell

[Captn Pepe]

Judging from their size and crazy profitability, I'd guess that no, there's likely someone else out there not boycotting WalMart. Too bad, really, because it is really a poster child for much of what is wrong with corporate America. I.e. make as much money as possible, with no regard for the costs to society, except when executives feel like using the vast power of a megacorporation to further their personal agendas.

Consider: WalMarts destroy local business via predatory pricing, aggressive marketing, and outright intimidation. Best estimate, for every two jobs created by a WalMart, three jobs in the larger community dissapear. These jobs are regularly worse than average, too: less than 35% of WalMart employees have health insurance, a majority the jobs WalMart creates in communities are part-time, with variable hours and no benefits or opportunity for promotion, and as a result, a significant fraction (a majority in some areas) of WalMart employees live below the poverty line. WalMart justifies these facts by claiming that it primarily creates retail jobs appropriate for working part-time after school or in conjunction with a "real" job. This, when it is single largest employer in many communities.

Nationwide, a majority of WalMart employees qualify for food stamps.

WalMart is also guilty of enforcing cultural homogeneity. Because it is such a large buyer, many publishers in a variety of media -- especially music and magazines -- have begun self-censorship out of fear that WalMart executives will yank a given product from their shelves. The article linked from this story discusses WalMart's increadible influence in the IT market; their influence in a dozen other industries is even larger. People yell about Nike and The Gap because they are brand-image based empires, but most of the output of Mexican, Pacific, and domestic sweatshops ends up on WalMart's shelves, and WalMart is big enough that they don't have to care if people hate them for this.

The WalMart model is a major contributor to urban sprawl and the degradation of community-oriented life. By destroying the local business base, and by locating stores on huge plots of land on the peripheries of towns and cities, it contributes to the flight to the suburbs, thereby increasing dependence on automobile transportation and the assorted problems that leads to.

Enough ranting for now, but maybe you understand why some people aren't too fond of this company. I can't possibly include a reasonably comprehensive set of links here, since people despite WalMart for so many reasons, but a really good links page can be found at Wal-Mart Watch.