Slashdot Mirror
Telstra Used Linux To Get Microsoft Discounts
awful writes "Last year Slashdot ran a story about Australia's largest telco moving to Linux desktops. Turns out it was all a way to get some tasty discounts from Microsoft. The Australian is reporting that Telstra just signed a four-year deal with MS for $AU15-20 million, for 40,000 users. No figures yet on how much of a discount Telstra got, but MS might want to rethink handing back all its cash to investors if this is how they're going to do business from now on ..."
One small setback for Linux; one giant leap down the slippery slope for MS.
If this sort of thing isn't direct evidence of the sure eventual demise of the Business Model as Bill Knows It, then I don't know what is.
"Thank you for calling Microsoft Corporate Sales--in order to direct your call, please enter 1 on your touchtone phone if you are oblivious to Linux. Enter 2 if you have priced a Linux solution for your enterprise. Enter 3 if you have considered a Linux operating system..."
"...all the labours of the ages, all the devotion, all the inspiration, all the noonday brightness..." yada yada
Sounds like capitalism at work :)
:) Way to use the free market to your advantage.
I love linux, but, go Telstra
Jay | http://oldos.org
Maybe, just maybe, this is how Microsoft intends to do business in the future?
This kind of first-MS-then-Linux-finally-MS stunts by any company is going to give free publicity to Microsoft, and more and more companies will be attracted to buying MS products because they thought they're getting a discount now.
And frankly speaking, $375 per user is still better than $0 per user, and lose face to Linux.
Uselessful technology (Air-Charged
I doubt it - this is the way business has always worked, it's only front page news because it's Linux vs MS.
If it was HP vs Cisco or any other 2 vendors which selling competing products it would have been rejected.
Hell, if you're in charge of buying product X for your company and DIDN'T try to lower the price buying shows quotes from companies Y and Z, I'd worry!
Looking for hardware (Currently need: Large Etch-a-Sketch) Have one? See my journal!
Somehow I doubt this is the case.
Telstra's IT head wanted to run Linux to cut costs. In a business they figure things out using a cost-benefit ratio. In fact, most human beings do this.
Microsoft simply offered them a deal with better cost-benefit ratio. Telstra aren't going to be downloading ISO's, they would be buying something like SuSE or RedHat. So Microsoft simply discounts prices, and Telstra has cut costs, without needing to move everything across to a new system.
As an Aussie, it's my duty to hate Telstra, but the headline is so very wrong.
--
The last digit of pi is four.
$500 AUD =~ $351 USD
$125 AUD =~ $87 USD
01100010 01101001 01110100 01100101 00100000 01101101 01100101
But this isn't just covering Windows Liscenses, It also mentions they're getting exchange 2003 and office 2003 plus they're probably getting quite a nice support package from MS. A copy of windows and office alone is more than $500 in store in Canada which has relatively the same dollar value as the Australian Dollar right now. Make No mistake, they definately got a discount.
In product pricing is trying to reclaim something called the "consumer surplus". The idea here is that the amount of money that each of your potential customers is willing to pay is different; vaguely speaking, you want to choose the price that balances out being low enough that you retain as many of your customers as possible, while being high enough that you make a lot of money on each unit. Still, there's always going to be that consumer surplus-- the amount of money lost to the fact that a subset of your customers would have been WILLING to pay much more, but because you have to charge them the same amount you charge everyone else you only got the same amount from them you got from everyone else.
This is why you're in very good shape if somehow you can work your way into a sales model where, as happens with an auction, or with car sales, you're somehow able to tailor your price to what exactly each individual customer is willing to pay. You maximize both the number of customers you get, and the amount of money you could get from each one.
This is where Microsoft's doing and it isn't a bad thing for them. Microsoft's prices are ridiculously high, and the market is beginning to realize this, but rather than actually correct for this and charge reasonable prices, they're simply continuing as they have and making special allowances for those customers who might be leaving.
Or, in other words: This shouldn't be seen as a victory for Microsoft's competitors because Microsoft's having to lower their prices for the customers who are threatening to leave. It's a victory for Microsoft, because Microsoft isn't having to lower their prices for everyone else.
For the benefit of our American readership, Telstra are Australia's local piece of evil incarnate. They're 51% government owned, so they combine the worst characteristics of rapacious private companies and pig-headed government bureacracy. They price-gouge to an incredible degree on access to the local loop, they deliberately delayed the introduction of DSL services so they could cream more money out of business clients using ISDN (at truly outrageous prices), and deliver shocking service to their customers (ask Bigpond broadband internet customers about the reliability).
Any sufficiently advanced technology is indistinguishable from a rigged demo
--Andy Finkel (J. Klass?)
That depends upon the weight of Australian Dollars and whether it is a metric ton.