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Will Microsoft Subsidize WinXP For Lindows Buyers?
kinema writes "Ars Technica has an interesting little article about Microsoft's alleged "dumping" of Windows XP. It seems that Microsoft is selling XP through TigerDirect for only US$50 to customers who have purchased a Lindows computer." Note that Tiger says nothing like this on their site (No, you can't buy WinXP for $50 there); Lindows CEO Michael Robertson says (in the linked column) that "Microsoft's latest offers to TigerDirect are extremely lucrative and I wouldn't be surprised if they ultimately cave to Microsoft's pocketbook." PR ploy or reality, you decide.
If you had bought a Lindows system, why would you wanna buy XP. You've obviously made a choice not to buy windows.
-- Karma Karma Karma Karma, Karma Chameleon - Boy George
I mean, do we *really* want Lindows to be the thing the masses at large associate with linux, or alternative OSes in general?
Machine9dotNet
Like the friendly neighborhood drug dealer, Bill says, "Here, have this first taste on me..."
People who have bought Lindows PCs are not going to want to spend yet another $50 bux on something that their computer does for them already.
From what I've seen the concept is to eliminate the M$ tax and make the machine as cheap as possible...this kinda defeats the purpose for the user.
I dont know that this is new news,
Microsoft seems to have been taking heat for something or another for as long as I can remember.
On the otherhand, all compitition play dirty. Dont they?
How Now Brown Cow
So, the main competitor to M$ for home-user computer Operating Systems allegdes that M$ is discounting windows XP when specifically targetting Lindows users?
Could be, certainly within the GatesBorgs resources and methodology. Equally however, this could be a cleverly designed ploy to increase the profile of Lindows.
I'll wait on some hard evidence.
Note: I'm not saying I like M$, but I'm certainly not about to go off on some raving Linux-fanboi rant without seeing some evidence first.
An infinite number of monkeys will eventually come up with the complete works of
IF and it is a BIG IF, if this is true then what happened to the Anti-Monopoly laws?
Interesting that in all of their supreme intelligence the DOJ and judge thought that their measures would tame the beast.
AND IF and again it is a BIG IF. It it is true. MS should be split right then and there into multiple companies... Sometimes the buck has to stop!
"You can't make a race horse of a pig"
"No," said Samuel, "but you can make very fast pig"
I would think this would be great for Lindows users.
This would make it cheap to make a dual-boot computer! I wouldn't mind having a Lindows computer for some daily work and piddling around. I would setup the dual-booting for games that only run on Windows. I could see paying $50 for it, but not $200...
I'm not a big Microsoft fan, but I am a game fan.
dochood
Why is it that anything Microsoft does is considered bad?
When Microsoft overcharged $200 for WinXP, everyone was criticizing them. Now that they are releasing it for a more reasonable price, they are still getting criticized. We should decide on the price we want. Do you want WinXP at $200 or $50. I would rather have $50.
Besides, is competition not one of the good things GNU/Linux has done to Microsoft? When they had no competition they kept high prices. Now they are reducing prices to compete. Is that not what we want?
PR ploy or reality, you decide.
/. poster with an overly creative mind. Microsoft couldn't give a rip about Lindows or any poor sucker that bought a bluelight Walmart special.
Neither, just some
I swear, there should make a "creative writing" section (and even icon with it)!
SEO Copywriter. Just Say ON
As a CD cost next to nothing in production cost they doesn't stand to loose much. On the other hand they distract people who away from lindows by saying: "Hey! Come get the real thing(tm) for only $50". My best guess is that lindows will suffer from this tactic move.
Unethical, sure, but thats not new. Squash competition before the competitor has any money. Seen many times before!
Exactly. Tell the customer: "buy Lindows for $50, then buy XP for $50, throw your Lindows into the trash, and notice how you've only paid $100 for your XP rather than $200"! And most users would be curious enough to keep Lindows around (rather than throwing it away), and might have a look at it one boring Sunday afternoon. In conclusion, this looks like an excellent deal for the customer, for Lindows, and for Linux in general!
To all who replied, here's a quick business lesson.
You have the development costs of creating WindowsXP (Cost A)
You have the support cost of maintaining WindowsXP (Cost B)
You have the manufacturing cost of producing a single copy of WindowsXP (Cost C, and let's assume that all fixed maufacturing costs such as the buildings and machines are included in the fixed development cost)
If MS sells n copies of XP, their costs are A + B + ( n * C ).
So if they sell 100 copies, it's A + B + 100*C
If they sell 10000 copies, it's A + B + 10000*C
A and B are already factored in. They know they have to pay for those no matter how many copies they can sell and they must price WindowsXP with some margin over C, and not worry about A or B.
If they can sell many copies of WindowsXP for a large margin over C, then they'll recover A and B very quickly. If the margin is small, it will take longer to recover those costs.
Microsoft estimates how many copies they can sell at various prices and chooses the price that allows them to recover A and B the fastest.
With a relatively small variable cost, it's almost impossible for Microsoft to "dump" their prices in the traditional definition of the word, which is temporarily selling below your variable cost to eliminate competition.
In the Lindows case, they're just reacting to market pressure.
That's what pays their developers' salaries.
OddManIn: A Game of guns and game theory.
I don't think that this will work well mainly because the people buying $200 computers won't pay $50 for something their computer already has, and more importantly, they wouldn't know what to do with it. Installing an operating system, which while isn't that hard, is not something that is not done by many people. I only envision 2 groups of people buying these computers. Those that don't know much about computers, and those that know too much about computers. The first group would be even less likely to try to undertake installing an OS and the later would already own a license for Windows or be smart enough to install some other OS.
First they ignore you, then they laugh at you, then they fight you, then you win. -Ghandi
The only surprise here is that Microsoft is acknowledging how overpriced Windows is. I loaded OpenOffice on my son's computer for his homework last night. For the average user with light word processing needs, Redmond's bloatware much too expensive as well.
What's the big deal here? Companies have been offering cheap upgrades for years. If you have a mobile phone from company X, you can almost always get a mobile phone from company Y for less than the "normal" price.
Microsoft has done this before, as well. When Windows 2000 was released, it cost $250, but it was available as an "upgrade" for $120. There was no requirement that the upgrade be from an earlier version of Windows; in fact, it was explicitly stated that this was an upgrade "from any operating system".
Tarsnap: Online backups for the truly paranoid
I love linux as much as the next geek. Heck, I'm running gentoo right now. But from a consumer perspective, those Lindows PC (when they're running Lindows) are junk. Relatively few scanners, printers or digital cammeras will work with them. Especially the kind of cheap scanners, printers and digital cammeras that a person buying a $200 computer is likely to buy. The software is going to be, like it or not, unfamiliar to nearly all consumers. Plus it won't run all those games and apps consumers see on the shelfs, and tech support lines aren't 24hrs (I know this isn't an issue for people reading this, but to joe average this really matters). This is not to say Lindows is a bad distro (It's not, it's actually pretty good and getting better). It's just not ready to go head to head with windows like this.
:), after they're established. In other words, I want them to behave like apple, at least early on, and find themselves a nice moneymaking nitch. By selling the hardware themselves (or by proxy by controlling what walmart is bundling) they can control compatibilty and give the user a more consistent experience.
So why do I want MS subsidizing XP on those boxes? Because every unit they move is a little money into Lindow's pocket. Maybe not as much as somebody buying click-and-run, but it's better than the nothing they'd get if the end-user just returns the damn thing because none of there peripherals and software works. Because as it stands now, Lindows by itself isn't going to make it.
What I really like to see from Lindows is them selling a complete package. Computer, monitor, printer, scanner, cammera w/smartmedia reader and software to make it all work. Brand the whole shebang, maybe take a loss on some components so you can make your money elsewhere, and above all abandon the silly notion that they're going to make money competing with microsoft right off the bat. That comes later
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
rather than dumping. IANAL, but I thought most countries had laws that are supposed to prevent the kind of practice alleged here: offering substantial incentives only to a specific competitors customers in an attempt to drive that competitor out of business.
I want to make sure that I don't overlook an important facet of the proposed discount. That Microsoft considers Windows XP only $50 superior to Lindows in enough ways that the discount is warranted. Is this a testimony for Linux on the desktop or what? If the Lindows product (tightly controlled for a Linux distro) did not have sufficient quality to make it an alternative, then MS wouldn't be paying so much attention to it. I do not use Lindows, I am a Debian guy myself, but I have to be honest... I'm interested in taking a look at what Lindows has to offer, which makes you wonder if the discount MS is offering is going to have the intended effect.
We evaluated a Lindows PC for use in a Citrix/Terminal Server environment here at my work. There were a couple problems.
1) The Lindows PC didn't run any of the binary releases of the Citrix client availaible from their web site.
2) The Lindows PC didn't have a compiler that would allow me to compile the Citrix Client from source. Nor could I compile rdesktop to use the RDP protocol.
4) In the end I had to set up a java jump page on my web server for the Lindows PC to be able to log into Citrix via Java. It was less than pretty and was not the solution my company needed.
5) That PC is now running Windows 2000 Pro in our shipping department. For 200 bucks I'd gladly buy 10 of them and throw win98 and a Terminal Server client on it to replace our other aging PCs. At least everything will have the same hardware. (The PC's come with a driver disk that has all of the windows drivers on it.)
Apple free since 1990!
Not too long ago, Ballmer gave an interview and said that MS was concerned about the cheap Linux boxes being sold because the owners would turn around and put pirated XP on them in under a week. This is an interview within the last 3 weeks or so, but I couldn't find the link. This is a typical MS FUD tactic. Provide some hearsay evidence that Joe Sixpack runs down to WalMart and gets his Lindows box to turn around and get a warez XP. That is, Ballmer says 'cheap Linux box == piracy' - first step in the plan. Now they pull this stunt at TigerDirect and you'll see that MS will give some explanation that their trying to stop 'piracy'. Walmart may be a different story. Bill Gates may be the richest guy in the world, but at least 3 people on the top ten list have the last name 'Walton'.
I've been swashdotted -- Elmer Fudd
I've heard dumping defined as selling a product for less than it took you to make it. It's a bit harder to judge this in the area of software, since it is very cheap to reproduce. However, I would think that by now Microsoft can easily sell Windows XP for $50 and still make a profit, so how is this dumping? It's just that MS has been overcharging before this.
so what you're saying is, you can't be assed to set up a secure Win2K box for your folks, with patches, and bugfixes, but you have no problem setting them up a secure Linux box? That sounds pretty biased to me.
For home use, Win2K is just as stable and reliable as any run of the mill Linux distro.
You seem especially hypocritical considering they already know how to navigate Windows to some basic extent, while they know absolutely nothing about Linux and will have to learn from scratch.
And, for the record, the command line is not arcane. I know of no other easy way, for example, to go into a directory full of MP3s, Oggs, and WAVs, and move only the Oggs to another folder. In DOS, it would be something like this:
cd \music\downloads ..\ogg
move *.ogg
In Explorer, it would involve hunting through and finding all the Vorbis files, and then Ctrl+clicking each one, and then cutting them, and then going up a level, and then pasting them in the ogg folder. As another example of the command line's usefulness, can you imagine pinging a site with a GUI? That would be retarded.
Jesus Chr*st that is NOT captialism. MS being an monopoly CANNOT sell it's products for $1 each in order to keep competitors from entering its market. That is illegal plain and simple.
Your vision of what captialism is is whacked. The worst thing that can happen in a capitialist market is one company gaining complete control. Sorry but being a strong advocate of capitialism myself I see this as among the worst things any company could do to maintain a monopoly.
If you wanna get rich, you know that payback is a bitch
You'd lose the case, because about $50 is what MS charges companies like Dell per copy when they buy in bulk. Their lawyers would say that this is the fair value, and the rest is markup for the retail distribution system. Pretty high markup, but hardly unprecedented.
In any case, if Microsoft can be accused of dumping for charging $50 for their software, couldn't a case be made against Red Hat for providing free ISO downloads? Isn't that dumping? It costs more than $0 to provide that service, so they are clearly dumping it.
... that Michael Robertson heads up the an Anti-Trust suit against Microsoft within the next 2 years for anti-competitive practices.
This is price dumping to prevent a competitive marketplace, raising the barrier to entry for competitors, pure and simple. If Microsoft keeps this up, the Justice Department is going to actually have to do some real work and actually punish them.
Or not.
"To make a mistake is only human; to persist in a mistake is idiotic." Cicero