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

[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.

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.

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.

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: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.