Microsoft in Peru, Living Room

Two pieces of Microsoft news today. tfofurn writes "According to this AP quickie and this Reuters story, both on Yahoo, Microsoft is donating 'about $550,000 in money, software and consulting services to the Peruvian government for educational and "e-government" initiatives' to Peru. The AP story mentions the conflict of this with Edgar Villanueva's proposal to have the government use only open source software. Villanueva (/. interview), you may recall, wrote a famous letter to MS Peru a few months ago." And many people have submitted stories about Windows XP Media Center, coming this winter to a living room near you.

Comments

Will everybody do the same?

[jmv]

It seems like MS is sending the message: "If you want to have 'free' MS software, say you're going Linux". Wonder how many organizations/countries without any intent to switch to Linux (will) have "Linux programs" just for negotiating with MS?

Re:Will everybody do the same?

[Jason Earl]

During Christmas time it is a fairly common practice (or it used to be when I lived in Peru) for the police to simply pull over motorists and demand money. Bribes are very commonplace in Peru any time of the year, but during Christmas the police stop even pretending to be upholding the law. They have got guns and you don't, and their children need Christmas presents and Paneton.

Lima is a city of something like 7 million people and this "donation" is supposed to help something like 20,000 students (a pittance). My guess is that it ends up helping far fewer students than that, and all of the help will likely go to the rich private schools that the politicos send their children too.

Unfortunately it is impossible to do business in Peru without bribery. I am just surprised that Bill Gates himself is delivering the money. When I first heard that Peru was looking at Free Software legislation I was very skeptical. There are lots of good people in Peru, and I don't doubt that Dr. Villanueva is an honest man and a patriot, but honest Peruvian officials are few and far between.

Re:Will everybody do the same?

[einer]

And if you were a company 100% on Linux or some other Unix flavor, you think switching to MS would not be "terribly painful and difficult".

Well, uhm... No. At least, not AS difficult. You see, Linux uses well defined standards and file formats instead of proprietary, constantly changing ones.

If it works, and does what they want it to do, why switch?

The business case for switching isn't JUST saving money. It's weening yourself off of said proprietary formats. Being locked in to a certain format might not be expensive RIGHT NOW, but using open formats means that it will never be any more expensive.

Re:Will everybody do the same?

[GSloop]

How about MS Word, Access, Excel and Powerpoint?

How about how Word 95 can't open any Word 97 docs. (Before you say, everyone does this... what was the necessity for this. If the upgrade was dramatically diferent, and it wasn't possible to use the same format, I might go easy - in this case, it seems really hard to make that argument.)

How about Access 97 vs 2000...

How about MS SQL Server, and your "special" extensions to SQL.

How about Active X, C#, HTML that only works on IE.

How about Kerberos?

How about breaking the OS/2 3.X compatibility mode every time they did virtually anything to Windows.

How about the totally bogus error messages you got in the beta versions of Windows 3.x when you were using DR Dos?

(Some of these are not propriatary file formats, but clearly demonstrate the capability and willingness to use despicable acts to maintain their power - and keep you by the short hairs.)

MS probably has one of the worst records of ANY company in the history of the computer industry. Locking you into a specific "hamster wheel" is their specialty.

If you like being MS's "hamster" go ahead. Many of the rest of us don't really care for it. For many reasons, money out of our pocket being one of them.

Cheers!

Its Basic Economics...

[FortKnox]

Let me tell you all the horrors of a capitalistic economy.

I own a lemonade stand that sells $5 lemonade. I have about 50 customers every 2 hours, giving me a nice customer base.
You see how I'm gouging people, so you open a lemonade stand for $1, and attempt to show people how to make lemonade at home for under $1.

I'll see what you are doing, and sell my lemonade for $0.50, which is less than it takes for you to make lemonade. For you to compete is for you to lose money. I can afford it, because I have capital sitting in a bank account. You go out of business, and I raise my price back to $5.

This is what MS is doing!

Its basic economics, people.
Now, don't give me the "linux is free" angle. Use the anology, but instead of money, use familiarity with the product, and the popularity with MS products vs open source ones.

This tactic is not new...

[malakai]

It's no different then scheduling the MS Sales Reps to come in for their 1hr long presentation, 45mins after you schedule the Oracle guys to come in for their presentation.

The two end up meeting in the hall, and notice each-other. Within literally hours you get phone calls and email saying to the extent "We really want your business, and well beat anything they offered".

Linux has to be prepared for this. Don't expect companies to back down from Linux competition simply because Linux is free. And don't expect companies not to use Linux as a expendable pawn in negotiations for better rates from existing vendors.

This is after all, how the free market works.

-malakai

Freedom

[Subcarrier]

Regardless, I said I was switching to Linux and never got a dime.

And I said unto Linus: "Grant me a boon or never again shall I touch Linux! I will rather take my fortunes with the Prince of Evil!"

And thus spake Linus: "Thou hast the option to do so, for I have given thee freedom."

And, overcome by happiness, I sank unto my knees and cried: "Never again shall I doubt thee, for I am indeed free!"

saw it coming

[Dr. Awktagon]

Ah I wish I could find the earlier comment were I said this is exactly what would happen in Peru. Well, no matter, this the usual Microsoft tactic. It worked in Mexico, now Peru. Will it work in Norway, a wealthier nation?

Must be nice to be able to print your own money like that: here's 1,000 CD copies of MS Foobar Pro, each worth $5,000 !! So we just made a donation of $5,000,000 and it's tax deductible (not that we pay taxes). And they'll still have to pay for upgrades. Beautiful! Let's see Open Source beat that!!

Re:Ahh, I see.

[ReelOddeeo]

Peru: We've decided to check into a drug rehab center.
MS: Here, have some more drugs -- for free.

Escalation - A chronlogy of events

[Cinabrium]

I'm not currently authorized to reveal my sources, but have some first hand information about the events surrounding Peru/MS case that could help to clarify things a little bit. The process of countering Dr. Villanueva's bill had several escalation steps; some of them saw the light, and some others didn't. I guess it's time to tell what I know.

1. Dec 14 2001 - Dr. Villanueva introduces the Bill.
2. Mar 06 2002 - Public Forum in the House of Congress (attendance > 500), chaired by the President of the Congress.
3. Mar 08 2002 - Universidad Nacional de Tumbes, a public university in Northwestern Peru, communicate their official support to the bill.
4. Mar 19 2002 - First counterattack: the Peruvian Software Producers Association (APESOFT)'s Chairman objections to the proposed Bill in "Gestion", a local newspaper.
5. Mar 20 2002 - Reply by Dr. Villanueva, in the same newspaper
6. Mar 25 2002 - Second counterattack - The now infamous letter of MS-Peru's General Manager to Dr. Villanueva
7. Apr 08 2002 - The well known reply of Dr. Villanueva
8. May 20 2002 - Universidad Nacional de Ingenieria (second largest public university in Peru, specialized in engineering and science) gives official support to the Bill.
9. May 27 2002 - Third counterattack - The American Chamber of Commerce of Peru (AmCham) sends a letter to the President of the Congress, opposing the bill. Same arguments as MS ones, plus some diplomatic threats as "...negative signals to private investments..." and Godzilla will eat our children.
10. Jun 07 2002 - Dr. Villanueva replies AmCham's letter.
11. Jun ?? 2002 - Fourth counterattack - Conversations, informal talks and "occasional meetings" of U.S. Ambassador Hamilton wih several high-ranked Peruvian officials, reminding them the dangers of approving the Bill.
12. Jun 11 2002 - Fifth counterattack - Letter from the Prime Minister, enclosing a memo of the head of the e-government project objectioning the bill. Same arguments as MS ones, plus "...negative impact in the process of renewing the APTA (Andean Trade Preference Agreement", plus the usual seven plagues of Egypt. Mr. Bermudez, the e-government guy, is known as being closely related to MS. Mr. Dañino, the former Prime Minister, is a lawyer whose law firm has MS-Peru as one of its most prominent clients
13. Jun 25 2002 - Universidad Nacional Mayor de San Marcos (the largest public university in Peru and the oldest in America [est. 1551]) gives official support to the Bill.
14. Jul 15 2002 - Sixth Counterattack - President Toledo's pilgrimage to Seattle, to receive the 30 coins (or less) from the hands of Mr. Gates

Except Mr. Hamilton's talkings, which were not recorded AFAIK, there is written evidence of all the facts stated above.

In addition, let me point out that, if Microsoft is pricing its consulting services at the same rate it did for their agreement with the Chilean Ministry of Education, the $550K "donation" means just 5000 person/hours of consulting.