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ESR Says as PCs Get Cheaper, Windows Will Die
james writes "Eric Raymond reckons Windows will be obsolete because people won't be able to afford it soon." Owning the OS gives MS too great of
an advantage. They'd sell the client for 5 bucks if
it meant that they could still control Office, the
server market, and the zillions of other markets that
their OS monopoly lets them crush.
No, Eric, microsoft will not go away like you've claimed for several years. Linux won't win the desktop 'war'. Get over it. Nobody cares anymore.
-
To be honest I don't think teh majority of Windows users actually bought a copy from a store.
When you go to the shops (or mail order) and buy a new PC, usually they have a software bundle with them and that's where you get your copies of Windows and Office (Well, mostly MS Works) from.
Because of this, and because it's very difficult to buy a PC *without* Windows, I don't think that this is at all true.
Chris
News flash: Product fails because no one's buying it.
Anyways, PC's are a LUXURY, not a necessity. You can either afford the box or you can't. Plus, how much of that cost is actually Windows? No one knows, no one's talking.
The average consumer thinks Windows is "included" with their PC purchase. That means that in their mind it's free, not a major portion of the actual cost. As long as that price is hidden it won't be a factor in a purchasing decision.
The single best thing we could get out of an MS settlement (since we're not going to get the break-up that they deserve) would be to require all PC sales adds to prominently display the cost of Windows and the percentage of total cost that it represents. That would certainly open a few eyes.
--- I wish I could hear the soundtrack to my life. That way I'd know when to duck.
It is easier to afford now that the *TOTAL* cost has come down. I had to save for a year in college to buy a Pentium 133 for $2400 and I was getting a good deal at the time. It's all relative.
Didn't he also say NT 5.0 would be DOA because of it's bloat and tardiness? I really wish ESR would stop making so many "predictions." It'd be a good move for his reputation and everyone else in the OSS community that feels the effects of the blanket associations with his comments.
This is a good point, I must admit I never though directly about this as a consequence of the reduction in PC costs, BUT theres a flaw in the Logic, software has ALWAYS cost more (since the late 70's) than the hardware itself, it may cause a shift, but certainly not the demise of MS.
MS would sell..hell give copies of Windows away if it meant they could continue their other markets, Less than 1/3 of MS income comes from desktop operating systems. Now that said they dont want to loose it but certainly it wont kill them.
Sig went tro...aahemmm.....fishing........
Ok lets just go along with this for a second and assume MS has no business sense whatsoever and would not adjust the OS price accordingly, will $350 pc's really be the norm? Even as PC prices continue to fall, it seems that most people are continuing to pay around $1500 or so for a computer because that is what they expect to pay for a computer. Systems that are really cheap have a negative stigma amongst consumers because they assume the computer is obsolete and will not meet their future needs. People are gobbling up multi GHZ machines even though a pIII would work for must people's needs.
People won't move away from Windows for 1 of 2 simple reasons, "I don't have time to learn something new" or "I can't transfer my MS Office documents to ". While there are falacies in both arguments, end users are a stubborn ignorant bunch for the most part.
Actually, those arguments are totally valid. If the makers of alternatives to Windows don't recognize them and address them, well, good luck with that.
Exactly! In fact, NT5 turned out to be the best OS release from MSFT ever. I haven't reinstalled it in the 2 years that I've had it installed, which is exceptional for a MSFT OS. The thing is pretty damn stable.
whatever
Thay can't lower prices. To ensure their massive cash flow they need stock prices to keep rising and the only way it will do that is if they post revenue increases.
The Desktop market is already dead for them. Too many buisnesses don't see the point of upgrading beond W2K. Office has the same problem. THis all has nothing to do with Linux.
The server market is the one place Linux is actually doing damage.
CE isn't making it's development money back.
WebTV was a big flop.
What's left X-BOX. Cell phones?
We have a company too used to being the dominant player to be able to break into new markets and going by the spew of new products into new markets lately they know the old revenue stream is dying.
Exactly. In fact, by making the claim that Microsoft can not lower their prices and survive, ESR is making the argument that Microsoft is not a monopoly.
The classic definition of monopoly power is that a company has the power to price above marginal cost - or the cost of producing an additional unit. While we know that real life is a little more complex than this classic definiton, by making the argument that M$ will crumble if forced to lower their prices, ESR is actually saying that Microsoft is not a monopoly...that the current pricing scheme used by M$ is driven by the market.
In one statement, ESR just poked a hole in his own argument without even realizing it. Nice job!
not the hardware.
The situation is like with DVD's. The medium (hardware) costs maybe $1, but the #&%/s can still charge $20 for a movie (software).
Suppose Dell could make a PC for $10. If Microsoft charges them $350 for windows, the end customer will have to pay $361 (at least) for a Dell w/ windows.
This won't change until Linux or another OS can challenge MS on the desktop. I'd pay for MacOS X if only they'd port it to x86...
The ESR Rap
(Chorus:)
I am EEE ESS ORR, elite hack-ORR, hear me ROAR!
1.
I am of the hacker elite, can't you see?
fetchmail, blindfolds in nethack, er... (hum-hum diddle dee)
Bow down on your knees, don't you diss me!
(chorus)
2.
I am an author, I "wrote" New Hacker's Dictionary
Well, shit, so what if I done stole it from MIT?
I didn't get in there, so I figured they owed me!
(chorus)
3.
I am founder and leader of OSI
Now my Open Source show is really on the road!
Free Software? Hah! Show me dat code!
(chorus)
4.
I am ESR Skywalker, elite Jedi Knight
I'm packing mah gun and I'm ready to fight
You diss me and I'll send you to eternal night!
(chorus)
5.
I am wealthy board member, VA Something-or-other
Got plenty dollar bills, at least on paper
What's that? Dot.com crash? Oh fuck! See you later!
(repeat chorus to fade)
ESR is being an optomist. While I agree that this is a possibility, I don't see it happening soon. There
are a few reasons why.
1) These PCs must be everywhere. There are cheap PCsnow that you can get. Someone mentioned that you can get cheap PCs w/o Windows at WalMart. That is all and good, but these types of boxes must be available everywhere, from every manufacturer. I doubt we'll see Dell advertise a $350 box without Windows anytime soon.
2) There has to be an operating system to replace
Windows on these boxes that is cheap. Linux is
not it. This probably would be a great place for
BeOS to have stepped in. I always envisioned
BeOS as being the ideal non-MS OS for the average
user. Unfortunately, they no longer exist.
Another unfortunate aspect is that there needs
to be an OS that essentially will need to have
a monopoly on these boxes.
Of course, it could be an Open Source OS.
3) The said operating system needs to have a few
good applications for it. One would be a fully
standard compliant web browser. Another would be
a word processing program with features roughly
equivalent to MS Word. There are some other
necessary apps, like perhaps a simple image
editing program, email client, media player, etc.
Basically, programs to cover all the bases.
4) There will always be people who still buy
computers that price in the thousands. These are
people who need and want more powerful PCs.
I doubt most gamers would care for the $350 PC.
I think that the number of people willing to pay
thousands for a superior PC is still high enough.
If the economy gets worse, however, this might change.
"You spoony bard!" -Tellah
I'm a college student, and I know that I can't afford anything near the amount of money that Microsoft wants to charge for office.
You're modded as funny, but I'll answer anyway: isn't the Student Edition of MS Office something like $99? And even if it was too expensive, as a student, you are unlikely to need the full features of office anyway and could buy the much cheaper but still quite useful MS Works.
The business world will never abandon Windows because they won't change the way they use computers. The cost of the computers used in business is viewed as an entire system, and software costs with support contracts are already a huge part of the total system cost. Even if the hardware got much cheaper it wouldn't budge the bottom line enough to make a difference.
The home computer market might be affected by this, but anyone who uses a computer at work will probably still want the same OS and software at home. MS already sells different levels of software between their home and enterprise users so they are aware of the price sensitivity.
If school boards can look beyond MS's bullshit fud they might consider open source to save money, but the reality is that they MUST teach what is used in the business world with real world hardware and software.
Walmart's experiment in selling computers without an OS will probably fail, though I hope they can make this program work for customers who know what they are buying.
For many people, the value of a product has more to do with the price than what the product can actaully do. By inflating the OS price, Microsoft marketing is trying to make consumers think it's worth more than it is. In the past they would inflate a price to increase desire, then slash the price to make the product ubiquitous, then slowly raise the price again. Why should they change a strategy that has worked so well thus far?
As PC hardware becomes cheaper, the OS will become cheaper, especially whenever a competing product comes on the scene. Microsoft is big and can afford to forgo profits much longer than potential competitors, thereby forcing them out of buisiness. Kind of like OS2.
----------- Sig what?
I'd certainly be happy to say he speaks for me, at least in a general, Linux community kinda way. I might disagree sometimes, but most of the time he's on the ball.
The whole problem with ESR and RMS is they're preaching a religion when all we want are tools and options to get our jobs done. People don't liked to be preached too, they just want thier options. It doesn't matter if you're right and you have the insight of King Solomon, people still don't want to hear you preach.
.COM bubble. (1993-1997)): Cheap communications medium offered by vast range of carriers (ISPs)
Now, If you can explain the *REAL* benefits of a *SPECIFIC* Open Source tool, or *SPECIFICALLY* how the open source model may benefit those involved (Benefitting usually implies the bottom line somewhere), THEN you will get people listening to you.
Look at the evidence:
The IBM PC clone didn't need a spokesperson, it's value being a commodity tool available from hundred and thousands of manfacturers spoke for itself.
As did the birth of Internet's commercialization (Not the
These products worked because:
1. They were cheap
2. They were valuable
3. They provided business opportunities for people to sell cheap and valuable products.
If you want Open Source to really take off, forget about a spokes person. Meet these three criteria, and Open Source will speak for itself.
"Communism is like having one [local] phone company " - Lenny Bruce
The PC pricewars came and went years ago. It was the age of the sub-$1000 PC, E-machines, Ellison's network computer, and all that. None of it happened of course. The market has stabilized since then. Computers are not getting that much cheaper anymore. You get a lot more value for your money each year: but in dollar figures the prices aren't dropping that fast anymore, if at all.
Pushin' 'n dealin', shovin' 'n stealin'
hasn't ESR noticed MS is diversifying it's business into games, tv and enterprise services? windows sales might become less important, but it's far from going away. get real.
For example, the studentdev.org thing they set up. Part of those programs was that students would get free copies of Visual Studio and Operating systems, to keep the students interested in developing for MS.
Lately, I haven't seen this so much, but I have seen the MSDN Academic Alliance, where they sell a massive license to a school for relatively cheap, and then allow all students in that school/deparetment to download all kinds of software for free legally. Included is stuff like Win2k Advanced server (which has a sticker price of nearly 4,000 dollars), and tons of applications. They will put the prices on the OS and development tools as low as they have to, just to keep corporations buying into their products.
XML is like violence. If it doesn't solve the problem, use more.
Unix standard ls format says that it was Dec.2001.
In which case 6 months is not yet up.
Hint to the slash maintainers. How about including years in article dates.
Eric Raymond is essentially correct on his assessment.
I am not sure if the $350 price point is the magic number but it could be that it is. Keep in mind that Wal-Mart now sells a 1 gig, 128 MB PC for $399 sans OS and monitor. PCs have been quoted sans monitor since the beginning of time. And, with the wide availability of free copies of linux in books and via download plus a lot of old copies of windows laying around, PCs sans the OS are marketable. Wal-mart thinks so. The white box boys know so. So too do the vendors that sell motherboards, chips and other parts as ordered by the most qualified of all buyers.
The interesting observation is the great sensitivity to this cheap PC issue during the DOJ antitrust trial. Microsoft tried very hard to convince the judge and the world that a typical PC costs $2000. The only reason for that is to downplay the impact of a $200-250 OS price from Microsoft. If PCs cost $2000, then the OS from the monopolist is only 10% or so of the total price. However, as Raymond points out, if the price is $350 or so, the OS from Microsoft could be 57% of the price. All of sudden, PCs sans OS are a lot cheaper. And, pricing PCs without monitors was engaged in as a practice to attract potential customers to the store. (Clearly no OEM thought a PC could be used without a monitor. And, few potential customers have spare monitors in their closet they want to use.)
The whole issue puts an interesting spin on the remedy proposed by the litigating states. Selling a bare bones OS may save Microsoft. It certainly reduces the burn of a $200-250 package included as part of a minimum purchase. This high minimum price also explains why the advertising from Microsoft often suggests that every single PC must have a browser, media player and any other gizmo software package that Gates thinks is neat. Gates can not be so stupid to think that all PCs do the same thing. Clearly he has more intelligence than that. It is simply a campaign to convince all consumers to not object to being forced to buy a whole pile of Microsoft branded applications before a competitor can make an impact on the market. Forcing the sale of the Microsoft branded media player is the next big push or force being applied to consumers. And, they are being forced to buy it if Microsoft and the DOJ can possibly do it.
The problem is (as Raymond points out) that all consumers are harmed by the process. Business computers may have no need for a media player. And, they certainly would prefer not to be forced to buy it for all employees. A media player is not going to increase the productivity of employees except in certain limited circumstances. And, if any customer has those circumstances, clearly they would prefer to pick and choose just which technology is best for their needs. Of course, the Microsoft plan is to prevent all customers from having that choice. The DOJ plan is likewise. The DOJ is now seeking to preclude all consumers from being to avoid buying a whole range of Microsoft branded products.
It is going to take more than just the while box boys and Wal-Mart. It will require IBM, HP, Compaq, Dell and others to sell PCs sans the OS (or PCs with a bare bones windows). Strange as it may seem, the litigating States may help save Microsoft from oblivian. Actually, Microsoft may figure this out on its own, although it may be too late by then.
NexuSys - Linux support by the best
Yup. This is a no-brainer bug that has gone unfixed for years now. I even reported this as a bug and it was closed for no apparent reason.
What's with not including years in article dates???
Steve Magruder, Metro Foodist
The cost of Windows to small OEMs is about $50, less at high volumes.
It's a mandatory component, just like a CPU or RAM or a keyboard. You don't say that when the price falls below X, you can no longer afford a CPU. The cost is whatever the cost is when you include all the components. The big players will use their purchasing muscle to get lower component costs and price so as to drive smaller players out of business, but nobody is going to price in a way that is independent of the cost of a mandatory component.
On the other hand, MS wants a broader consumer presence, so they may choose to create a separate "lite" version that they sell for less in order to make $350 computers possible. They could go all the way down to free for lite versions built around access portals to MS online services.
ESR's open source experience has apparently been more about politics than economics.
"Those who have never entered upon scientific pursuits know not a tithe of the poetry by which they are surrounded."
There's also another issue. The rise of the $350 is only ONE of Microsoft's problems. "Real PCs" are now getting to the point where they don't need to be upgraded as often. Hardware prices have managed to sufficiently outpace bloat growth for the time being. "Real PCs" continually get cheaper while continuing to add features that many "consumer" PC users don't fully utilize.
In general, consumers in general are bound to come to the realization that they really don't need a new PC, they really don't need a new OS, a new OS may not be any better than the old OS, or that they don't need a new version of MSoffice.
Once this occurs, and once consumers at large begin to revolt against the costs associated with the upgrade treadmill, Microsoft is going to be in deep doo-doo.
Mundane consumers may not give a damn about product quality, but they do tend to care about cost.
A Pirate and a Puritan look the same on a balance sheet.
As PCs get cheaper, if Microsofts high price becomes an obstacle to market domination then they will lower it. They only charge that much because they can. Bill Gates will do what he must to stay on top, if that means lowering the Windows price, he will. Then, he gets legions of sheep buying computers for the first time because the most important man in the world was nice enough to lower prices for them.
ESR is a smart man, I'm sure. But Bill Gates- I honestly do not believe he is after money. He just wants his software running everything in the world. I don't think he actually wants domination, but he wants a piece of every pie just to have it. If it got to the point where to keep the windows dominance he had to subsidize Windows out of pocket for a while, I am convinced he would do so.