Software Piracy Due to Expensive Hardware, Says Ballmer

frdmfghtr writes "ZDNet is running a story where Steve Ballmer tries to pin the blame of software copyright infringement on expensive hardware: 'One way to stem piracy is to offer consumers in emerging countries a low-cost PC, Ballmer said. "There has to be...a $100 computer to go down-market in some of these countries. We have to engineer (PCs) to be lighter and cheaper," he said.' Does he think that cheaper hardware will make copying software harder to do?"

Comments

Geez Louise

[AKAImBatman]

He's really grasping at straws, isn't he? Anecdotal evidence suggests the exact opposite. When the price of hardware goes down, the market generally demands that software costs go down as well. That's why there's so much griping about Windows being large chunk of computer costs these days. I've even heard people use that as justification for pirating software! ("My computer only cost $500, so why should I pay Microsoft $250 for Windows?")

In addition, many people seem to be particularly upset that they're forced to pay Microsoft enormous sums again, and again, even if they don't want to. In other words, people feel like they've already payed Microsoft their dues, so why should they pay it all over again? This has the effect of delaying upgrades until new computers are purchased, with businesses being the primary exception.

Because of Microsoft's stranglehold on the market, they are able to rope companies into upgrade contracts that extort payment for new versions. Under these contracts, failure to upgrade results in higher costs for later upgrades. So much higher that it makes more sense to upgrade now rather than later. Could any other company pull these sorts of strong-arm tactics? Of course not! In any other business, you'd find a competitor and switch to them (or at least use it as a negotiation tactic).

Let's hope that the rise of Mac OS X, Linux, Novell, and Sun as desktop competitors will finally provide a viable choice for both home and business.

Re:Geez Louise

[gcaseye6677]

Balmer just keeps getting dumber and dumber. When will the board of Microsoft wake up and can his ass? He seems to be one of the few people in the world who just cannot grasp how fucked Microsoft will be once their Windows/Office revenue stream dries up. All he has to offer is excuses and half-baked ideas like product registration (did anyone not think this would be cracked?) and licensing deals that are so unappealing they lead companies to seriously consider other platforms. Balmer is the perfect example of a PHB in the extreme.

Re:Geez Louise

[tambo]

He's really grasping at straws, isn't he?

Absolutely. By this reasoning, gasoline if cars cost less. Although the products are used together, their prices and markets are almost completely unrelated.

In addition, many people seem to be particularly upset that they're forced to pay Microsoft enormous sums again, and again, even if they don't want to.

Correct. That is, of course, Microsoft's core business: virtually all of their strategy involves cementing the position of Windows on the desktop, so that they can charge people again for the same product every time they buy the machine. An even better example is Microsoft Office, which hasn't noticeably improved since before 2000, yet still costs $250 or so.

Let's hope that the rise of Mac OS X, Linux, Novell, and Sun as desktop competitors will finally provide a viable choice for both home and business.

Sadly, that really won't happen until there is one compatible, OS-neutral software platform. Most new commercial software is written for Windows - that's simply a fact - and it's because of (a) the network effect of such a large market, and (b) the success Microsoft has had with making Windows software development incredibly easy. Compare a nicely-fleshed-out Windows application, with automatic visual styles and Direct3D and OpenFileDialog boxes, with wonky Java applets that might run in a browser, and might just break.

So the way to break the Windows monopoly is to create one finely-honed programming platform. When the latest 3D games and business apps run just as well (or better!) on Linux as on Windows, the migration barrier will be much reduced, and people will switch in greater numbers.

- David Stein

Re:Geez Louise

[Daengbo]

When the price of hardware goes down, the market generally demands that software costs go down as well.

This is exactly what I was thinking. When I lived in Thailand, the government promoted a low-cost computer with Linux pre-installed. They offered easy financing with 0% interest through the governments ?credit union?, I think.

This did not in any way affect the piracy problem. In fact, it created such downward pressure on MS's prices that the first crack appeared in the "one price around the world" policy. The piracy rate didn't change (it couldn't really go up...), and in the end, nothing changed.

Low hardware prices will not solve MS's problems.

Re:Geez Louise

[Anonymous Coward]

He seems to be one of the few people in the world who just cannot grasp how fucked Microsoft will be once their Windows/Office revenue stream dries up.

Luckily it's more of a raging torrent rather than a stream.

Chess_the_cat. Banned. Again.

Re:Geez Louise

[Ohreally_factor]

This is as non-sensical as his iPod = theft spew. In fact, maybe that's his game. Whose hardware is generally perceived as "expensive"? Of course, he doesn't actually want to mention the company name. Right after he ragged on the iPod, that company reported some amazing profits and sales figures for the iPod.

Re:Geez Louise

[Vitus Wagner]

programmers out on the street with signs that say "Will program for food!".


I wouldn't buy this. Results of their programming doesn't justify even food.

Re:Geez Louise

[IWorkForMorons]

Never mind that Microsoft programmers are some of the most handsomely paid in the business.

Correction: *Fulltime* Microsoft programmers are paid handsomely. The rest of the programmers are getting screwed. Go read No Logo if you don't believe me. So the "Starving Programmers" commercials will be real. Real, as in their actually starving, but not because you won't more for software...

Re: Geez Louise

[ThosLives]

[offtopic to main thread, but on-topic to parent]

...until there is one compatible, OS-neutral software platform...

What do you mean, "until there is..."? There are many, many "OS-neutral" platforms out there. Part of the problem is that there are too many. But that shouldn't mean all that much - if one company picks one for all their apps they should be fine.

Here's a simple example. I'm working on developing a game. Say I want to sell that game on as many hardware platforms as I can tolerate. Let's say I happen to write that game using OpenGL, GLUT, and one of the standard C variants (ISO, ANSI, whatever). If I do that, I only have to make one version of the source code, compile for a bunch of targets, and I'm done. Sure, the performance might not be the best across all platforms since any interface I make for OpenGL is going to be a "second" window system on top of the host OS. But that's not the point - the point is that if you use some standard API (standard console i/o, OpenGL, etc) and don't go munging in "tricks of the host OS", the technology for OS-neutral applications has existed for years.

I only say this because I have written simple and fairly complex (generally console based, mind you) applications using standard language features that first-time compile and run on Windows, Mac OS (X), HP-UX, and Solaris. I've even done the aforementioned OpenGL work that is consistent across Mac and Windows (I don't have access any more to the HP-UX or Solaris machines).

What people sacrifice to follow this route is a "host OS look and feel" by using the host OS API calls. I'd rather, as an application programmer, have the ability to call simple graphics APIs and define my own behavior - closer to what things like OpenGL, GLUT, X-windows, and even DirectX provide rather than even things like Swing or all the widget toolkits for X-windows. Yes, it's nice when a host OS provides "standard controls" but then I have to port and "support multiple platforms". If I hire some guy to write my own standard GUI library and use something like OpenGL that's fairly ubiquitous as my "OS abstraction layer" then my application looks and behaves the same on all systems. This, to me, is more valuable than having all the applications on a system look the same.

Okay, I realize that was a lot of text to try and illustrate my point. My gut feeling on what you propose, though, is that it's more politics than technical difficulties. After all, what is an operating system really but an abstraction layer to the hardware; all the rest of the crap that is part of a modern "OS" is really applications. I think when the paradigm shifts back to "the OS just provides access to the hardware functionality" then software writers will be better able to write applications that work on any hardware - so long as the hardware API is consistent!

Incidentally, the cost of software would indeed come down if there were fewer platforms to support as complexity will be reduced. The more combinations of any product there are, cost goes up drastically. But, again, the "common OS" or whatever doesn't really even begin to address the issue of cost of hardware having anything to do with software piracy. Piracy is simply a market reaction to the cost of purchase vs the cost of getting copying, distributing, posessing, and using unpurchased software. (Since the cost to do this is zero, and the cost of risk getting caught is below the purchase price of most software, people will continue to pirate software).

Re:Geez Louise

[hobuddy]

Java is a nearly total failure at desktop applications, and will remain so, because Sun doesn't give a damn about enabling native Java apps to deliver user experiences comparable to those offered by native apps.

Every day I use one of the most successful Java desktop applications (jEdit), and like it very much. So it should tell us something when the author of that application, Slava Pestov, advises programmers to "just give up" on Java for the desktop:

It is clear that Java was never practical for developing real applications, and never will be. Instead of asking how you can revive something that's obviously dead and gotten much more hype than it deserves, you should be asking if there's better technology out there.

Re:Geez Louise

[j-turkey]

NOBODY and I do mean NOBODY writes Java Applets any more. Java Applications are what have been working to displace Windows dominance. A few examples:

Azureus Bit Torrent Client...

I'm with you about the Java Applets. F-U-G-L-Y. However, I'm going to use your post to illustrate my point earlier in this thread about Java. However, I've used Azureus quite regularly on multiple platforms. It's an excellent application. I've also used BitComet, a Windows-only C++ native BitTorrent client. Although the latter is only available for Windows, the performance differences between Azureus and BitComet are astonishing. BitComet's memory and CPU utilization are significantly lower, and from an antecdotal "application snappiness" level, BitComet just crushes Azureus.

This it not to sling mud at all of the Java-lovers out there. Its a fine development package, and definitely has its purposes. The point is that under most circumstances, a lower level language, while generally more expensive to develop, can yield greater performance. To me, this is critical.

This single example clearly doesn't drive the point home, and I've seen studies that tend to show otherwise, but this just provides a single real world example of where a lower-level language-based application can outperform its counterpart. Finally, I don't have a problem admitting (disclaiming) that I'm slightly biased against Java after working on a few Java development projects in the early days and been infuriated by its performance.

Re:Geez Louise

[BaldGhoti]

Except he's bald, so instead of Pointy Haired Boss, he's a Pretty Hairless Boss.

This guy doesn't know geeks!

[slars]

OK, give me a $100 computer, but I'll still refuse to pay for Micro$oft crap on my computer!

Re:This guy doesn't know geeks!

[gl4ss]

heheh..

who in their sane minds would pay MORE for the os than the computer?

is he just thinking that "hmm. yeah.. so they can buy this computer at 500$.. hmm.. if the computer part just cost 100$ then they would be able to afford to pay us 400$. CALL THE PRESS! *mokeyjump* *monkeyjump* "

Re:This guy doesn't know geeks!

[saintp]

It rather startles me that both Microsoft and Sun are yammering about hardware being free and software costing money when, if we've learned anything in the past 13 years, it's the exact opposite. Hardware will always cost money; bricks and mortar don't want to be free. Manufacturing costs will always exist (except in some nanotech utopia).

Software, on the other hand is information, which desperately wants to be free. And, contrary to the predictions of Schatz and Ballmer, software already is free.

Until they make hardware freely duplicatable, it will cost money. It's more expensive to make 100 sticks of RAM than one. But it's no more expensive to make 100 million copies of Firefox than it is to make one. In fact, it's no more expensive to make 100 million copies of Windows -- legal or not -- than to make one. That's Netcraft confirms that Microsoft is dying: with information gaining increasing freedom, a company that sells information will be hard pressed to survive. A company like IBM, on the other hand, which sells silicon but gives away information, can expect a long and prosperous future.

Re:This guy doesn't know geeks!

[bentcd]

In my opinion, if I manage to do such a good job automating my activities that I make myself redundant, I will have achieved an astonishing success and I will leave my job with a grin on my face.
I'm a clever guy, I will find something else interesting to do to put bread on the table.
I can see, however, how this might be a scary prospect for the leeches out there :-)

Re:This guy doesn't know geeks!

[sjames]

I don't think that calling that out was inappropriate.

It's perfectly fair to disagree with the implied sentiment, but calling the statement wishful thinking was like saying "water wants to flow downhill" is wishful thinking when what you really mean is that dams are a good thing (or at least inevitable).

Wow.

[rudy_wayne]

It's absolutely amazing that the head of one the biggest corporations can publcily say something so totally and utterly stupid.

Re:Wow.

[TheLink]

Since most of these public figures aren't actually that stupid/ignorant, they are probably assuming their target audience is.

CEOs (and many other smart public figures) don't speak to individuals. They speak to targetted masses. They manipulate masses not individuals.

When public figures (which CEOs are) get away or even rewarded for saying stupid things it doesn't prove or show that they are stupid, it is the public who are stupid. And so far many of such public figures are being rewarded for doing such things (notable politicians and leaders included).

I believe this is an act of cynicism not stupidity.

It's fun to watch when they miscalculate. But nowadays it's quite disgusting how boundlessly stupid/ignorant the public is.

Re:Wow.

[amightywind]

They let Bush do it all the time, and he's the head of the biggest corporation in the world. ;-)

As opposed to Kerry? Kerry reminds me of a ventriloquist's doll. The DNC chairman has his hand up his ass making his mouth work.

price of the PC???

[Gothmolly]

So I buy a $100 PC, but then need $700 for an OS and desktop suite (WP, spreadsheet, et. al)? Steve, put down the pipe, you've been hanging out with Darl too long.
Or is this a sinister MS plot to get people hooked on cheap PCs, then use a subscription $9.95 a month model to 'rent' the software?

Ah....No

[deanj]

PCs are cheap here. You can get an entry level PC for less than $500. Still there's piracy.

Look at the Palm or mobile phones. Cheap cheap cheap. Still there's piracy.... and a lot of those programs only cost $5.

The cost of hardware and software have nothing to do with it. If there's a way to get a "free copy", some people will always go that route.

Re:Ah....No

[vidnet]

Finally someone who gets it! People don't pirate because they can't afford software. A $5 midlet or $10 shareware app is less than what most people spend on a dinner or throw away in the arcade at a whim.

It's not only cheaper, it's also easier to find a serial online than it is to paypal the money and wait for the mail. Not to mention it's likely the only way for kids without Visa or parents who trust online shopping.

Better Solution...

[YodaToo]

Offer them excellent open source software for free. This way they won't even be tempted to pirate the stuff.

OK, that explains it...

[schon]

MS's problems aren't because they don't understand security, or customer satisfaction, or that monopolies are held to a different standard..

It's because the people in charge live in a different universe!

You have something with almost zero marginal cost, and mark-up measured in thousands of percent, and he thinks the problem is because the *hardware* (which has a large marginal cost, and has mark-up measured in the single-digit percentages) is too expensive?

Sweet Jebus, software is pirated in third world nations because the software is too expensive.

I wonder what color the sky is in his world?

You can find $100.00 PCs

[gi-tux]

If you look for something that is old enough. Oh, but they won't run his bloatware :-| I guess that he is still wanting to sell M$ software, not use them with Linux.

So he is talking a $100.00 PC with a $200.00 OS and $500.00 office suite? How is this going to cut down on piracy?

He's crazy like a fox.

[AtariAmarok]

He may look like Young Frankenstein, and dance like Elaine Benes, but the man is a shrewed business shark. Either what he says is true, or more likely it is a "FUD" plan by Microsoft to achieve some sort of effect that we are not discussing here. From my point of view, however, his statement makes no sense at all.

Re:He's crazy like a fox.

[antiMStroll]

Some MS representative has publicly stated in the past - Gates I think - that in the future hardware will be free and consumers will only pay for software and software services. In economics it's known as the "Batshit Crazy" theory. This is just more of the same from Balmer following the party line. You also have to question how cagey it really is when every CIO worth his salt knows of the free OS alternatives and MS is being forced to release 'cut price' versions of its OS in Asia.

How will this work?

[Negatyfus]

A $149 PS2 didn't stop GTA: San Andreas from being pirated.

It's a sport for the crackers, often easier than buying for the consumers and always cheaper. So how is paying for software to compete with getting it for free and without leaving the house?

Re:What's MS going to Do?

[xmas2003]

YEP - right now, a retail copy of Windoze sells for something like $300 (my guess is bundled cost to Dell/Compaq/etc. is around $50 or so) ... so for the $500 hardware PC, the incremental cost of the OS from the manufacturer is 10% ... so it's still somewhat "hidden" - I DO wonder if they actually sell much Windoze at the retail price of about $300.

Now ... PC hardware drops to $100 ... so now the cost of the OS is 50% ... becomes a LOT more visible to both the manufacturers and also the end-users.

And finally, as the parent points out, what happens when a service is provided and the hardware is provided for free ... ala how Cell Phones are done today.

Re:What's MS going to Do?

[Errtu76]

Running an aplication without the use of an OS ... uh-huh. Exactly *how* this application is supposed to run is beyond my imagination. Also think about this: would you really store your sensitive data on a public system? What if it's compromised? What if it crashes? And paying for something that's free now?

sigh... RTFA

[Jrod5000 at RPI]

i know i'm a fool for thinking /.ers should try reading an article before ranting (especially one about MS) but...

all ballmer is saying is that people in developing nations will be more likely to pay for software if they have the option of owning a computer. you can't pay for windows if you can't afford a pc! its a valid point, though obvious.

Steve, it's your fault ppl need faster hardware

[Leknor]

Umm, Steve, it's partly your fault people need faster hardware? Each new release of MS {Windows,Office,Whatever} needs bigger and bigger specs. If Windows Longhorn ran faster than Win XP on the exact same hardware, the base price for new machines would drop due to natural market pressures. Instead each new release inflates the system minimum requirements which naturally inflates the cost of a baseline system.

Disclaimer: pretty much all of the computing industry, including open source software, are constantly requiring more and more powerful CPUs.

XBox?

[klogg_siebentag]

The XBox is a cheap hardware platform, and pirated XBox games don't exist...

He thinks he can use the cell phone principle

[mocm]

I don't know how they do it in the US, but here in Germany you can get your cell phone very cheap or for free if you enter a long term contract with your cell phone company. They are betting on the fact that once they you don't have to pay the money all at once they can bleed you dry little by little.
If you have a low hardware price the entrance barrier for getting a computer/cell phone becomes very low. They hope most people don't look at the montly costs too closely and once you have the hardware it would be stupid to waste the money you already spent ;).
If you can do the same with a computer and lock up the hardware so that only your software runs on it, they hope to get a lot more money. The same principle works for video games, printers and razors.

They're looking at the problem the wrong way

[JayBlalock]

You know, I've decided all of these "anti piracy" measures have started actually affecting how corporate minds think in places like Microsoft and the RIAA. They're looking at piracy like the US government seems to look at terrorism. There are X pirates out there, and if we can just make them stop, then everything will be hunky-dory and sales will increase a thousandfold.

This, of course, is nonsense.

They are asking "How can we stop piracy?" when what they NEED to be asking is "How can we increase sales?" These aren't equivilent questions in the least, but they seem to believe they are. We all read that story about piracy in Russia. If a single $15 CD costs approximately 1/4 of an average citizen's weekly pay there, there is simply no way in hell they're going to be paying $200 for MS Office. EVER. Doesn't matter how frigging cheap you make the computers, even if you give them away in very large cereal boxes, the people are NOT going to spend half their month's paycheck on a piece of software.

This will not hold true in ANY scenario. Ballmer & Friends appear to believe that if they eliminate piracy, copies of Office will fly off the shelves. Even if they did manage to make a copy of Office which was 100% unpiratable (for the sake of argument), that wouldn't spur sales any. The people would just start pirating some other piece of software, or use OOo.

The *only* rational solution to the problem is to drop software prices. The ONLY one. No other solution has the potential to actually increase software sales. (which certainly should be their goal, unless they've given up on actual profit in their eternal search for scapegoats) Yet that's the one measure Ballmer says they will NOT implement.

Interesting, huh?

My theory, incidentally, is that Microsoft is terrified of these hypothetical localized copies of their software leaking into the mainstream and selling at a discount. That's why their cheap XP-lite is so crippled. It doesn't HAVE to be, but they're so protective of their market share that they're unwilling to risk it in any way, even at the potential benefit of even more markets.

Either that or, as I said, they've become so focused on pirates that they've forgotten to actually do business in the meantime.

Re:What's MS going to Do?

[Tenebrious1]

Running an aplication without the use of an OS ... uh-huh. Exactly *how* this application is supposed to run is beyond my imagination.
The parent said boot and connect to a google-like service without an OS. That's entirely possible through PXE. Once you connect, your system downloads a minimal linux OS, and *then* runs the applications on the service.

would you really store your sensitive data on a public system?
Sure, that's why we have strong encryption.

What if it's compromized?
Like home machines don't get 'pwned' now? Their data is probably better off on some major service that actively takes steps to ensure system integrity. Crashes are no different.

And paying for something that's free now?
As for paying, well that's been tried before, free pc if you subscribe to a service; that didn't go over too well with people, so that's about the only part that would be a problem.

Sell Windows at $50

[Anonymous Coward]

I have always said that if Microsoft Windows XP Pro was around $50(USD), I would happily pay for a real copy. Then, it would be worth buying because:

-I avoid the hassle of copying a cd or looking for it online.
-I avoid the hassle of obtaining a key that works...possibly having to find key generation software out there...which may have a virus or spyware in it.
-You don't have to worry about not being able to get software updates because they figured out your key was fake.
-You actually don't hurt Microsoft, and instead help their revenue, which helps to pay for development of new software.
-Microsoft quits bitching (you really can't blame them).
-You get that "feel good" feeling of not being a criminal. :)

Microsoft, please look into selling Windows at an approximately $50 retail price. Sure, there may always be software pirates, but at $300...that just hits my checking account too hard when I'm already in 9k of debt like many out there. That's my honest take on it. I wonder how many other people out there feel the same way. Maybe windows is just overpriced...

An idiot...

[Eggplant62]

Ballmer is clearly out of touch with reality on this. Cheap hardware will not change the software piracy problem a whit. Why do people pirate software? Because operating systems run $80-$120, Microsoft's Office suite costs $450, Anti-virus runs $40-$80.

These ridiculous software prices, the constant need to upgrade and relicense and pay the same prices over and over and over -- that's what drives people to pirate software. Or turn to open source software solutions. Microsoft's trash got tossed out of my house on its ear 5 years ago. Nuttin' but Linux and there are scant few things I can do without their virus propagation system.

OS-as-service

[Vitus Wagner]

This solution exists for twenty years. It is called X terminal.

As for your questions

What if it's compromised

There was posted news on slashdot many times, that Windows system on broadband connection is going to be compromised in 20 minutes without qualified sysadmin supervising.

System offering public service would be supervised by team of qualified admins, so it is much less likely to be compromised.

What if it crashes

Do you have backup device capable of backing up your hard drive? Do you use it daily? What would you do if your system crashes? Spend a day reinstalling everything and loose data?
If public server crashes, it is likely to be fixed by its admins very soon, and your data restored from backups.

It is much more probably that your connection to this server would crash. And deprive you from working with entirely functional server. It is a drawback of OS-as-service solution.

And paying for something that's free now?

Are you sure it is free now? I'm running couple of X terminals home. One of them is more than 10 years old and never need hardware upgrade. But if I count all the money I spent upgrading my home computer last 10 years, it would probably cost more than $50/month. And countless hours administering the system. How much your work-hour cost?

Re:OS-as-service

[FireFury03]

Are you sure it is free now? I'm running couple of X terminals home. One of them is more than 10 years old and never need hardware upgrade. But if I count all the money I spent upgrading my home computer last 10 years, it would probably cost more than $50/month. And countless hours administering the system. How much your work-hour cost?

The most common reason for a top of the line system is gamaing - that's something that cannot be done on a remote server (there's just not going to be enough bandwidth to shift all the video data between a remote server and your monitor). I don't play much in the way of games (the odd game of BZ Flag and thats about it), so I'm quite happy with having a system that's not top of the range.

I bought a P200 in 1997 and that served me well until 2002. Yeah, ok it got a few upgrades on the way - hard drive, CD burner, modem, monitor, etc. The only one of those upgrades that wouldn't have been applicable if I was using a remote server to run all my code is the hard drive. I'd still have got a CD burner (so I can keep a personal backup of the data, coz I wouldn't trust a remote service with the only copy, and to burn music CDs). I'd still have got a new monitor - using a remote server won't stop me wanting a decent quality display. I bought a new modem coz the old one died - it wasn't a big deal coz I just lost my internet connection for a while, but if I was using a remote server for everything that would've keft me computer-less until I bought a new one.

In 2002 I got a new machine - Athlon XP 2100+. Again, that's had some upgrades, but nothing that I wouldn't buy if I was using a remote server to do everything: scanner, printer, new mouse, DSL router, etc. I fully expect that machine to last me until at least 2007.

Hell, I still use my old P166 laptop - it needs a bit more memory really, but it's still fine for browsing the web and running a few Eterms.

My Athlon cost me 300ukp (no monitor, etc - I reused my existing monitor) - assuming a life of 5 years that's only 5ukp a month, and I for one prefer to have complete control over my system - in short, I know how clueless some of the techies at these companies are (hey, I've done tech support for them) and I wouldn't trust them to run my systems.

Remember, most upgrades are either stuff like printers, scanners, etc. which people need locally whatever they're doing, or games related stuff, which would have to be local for bandwidth and latency reasons anyway.

And countless hours administering the system. How much your work-hour cost?

Yes, fair enough, the time I spend adminning my systems does add up, but most of that time is coz I want to either set things up exactly as I want (something I can't do if I'm relying on someone else to do it for me), or because I'm doing something new, cool and bleeding edge (something I'd probably have to pay someone a lot of money to do if I weren't doing it myself).

I'm also not sure how you stop clueless lusers doing stuff like installing spyware - either you prevent them from installing anything (which would make it terribly restrictive) or you have to live with the fact that users will install dubious stuff.

People want computers to be appliances which they don't have to maintain, like a toaster, but they also want to be able to take their toaster and install a coffee maker, microwave and washing machine in it at will. I don't believe it's possible to have an appliance computer thats flexible enough for most users to use as their desktop machine. Although it's easy enough to do - stick the OS on a read only device along with any programs you want and make the storage device for the user's data non-executable - there's almost nothing they can do to break it then... but I wouldn't want to use that kind of system.

A computer is more like a car - it needs maintaining by someone who knows what they're doing. I maintain my own computer. I take my car to the garage and get a professional to maintain

Just a guess

[Dragoon412]

But it seems to me that piracy is so rampant not because of hardware costs, but because software costs will nickel and dime you to death (obviously, this doesn't apply to OSS, so spare me the "OMG use Lunix!!11" responses).

So, first I start off with the $300 OS.

Then, take a look at the other day-to-day software a typical user will (probably) need / want:

-Anti-Virus......$50 / year
-Compression.....$25
-Anti-Spyware....$25
-Firewall........$50
-Image Editing...$200+
-Decent IMing....$20
-Office..........$150+
-Popup Blocker...$25 ...and that's just to start; basic sorts of things that a typical home user would have. Suddenly that $500 PC isn't such a good deal.

Re:What's MS going to Do?

[badriram]

Hence they came up with that really cheap version of windows for some parts of the world. I think he wants cheaper computers with the cheaper windows in all the homes.

Lets say out of the 250Mil or so middle class in india, 50mil get a computer because of cheap computers and OSes that is an extra 15billion in MS pocket...

Software Piracy due to expensive software

[Anonymous Coward]

I think what Steve Ballmer meant to say is that Software Piracy is due to expensive software. Hardware now is the cheapest it has ever been for such capable systems. If commerical software is such good value for money, why would there be such growth in the use of open source software? Why should people pay full price for a slightly modified Windows every few years that only brings more obtrusive 'Product Activation' and 'Digital Rights Management'? These things only serve to irritate users, and make Windows an unacceptable choice. Users should be free to install as many copies as they like on their own systems, with no extra cost for multiprocessor licences, server versions, etc. These are the reasons that I switched to Linux myself, along with the improving usability that Linux is achieving, and ethical concerns about buying US products, given the recent behaviour of the United States.

Re:What's MS going to Do?

[Anonymous Coward]

The price your quoting represents the OEM version that requires it to be purchased with hardware. The XP Home Upgrade runs $105 and the XP Home Retail runs $199. NOTE: These are the NewEgg prices.

As for piracy, I tend to think the price of the software/music/video/etc... is what really drives the piracy. Here is a question then...why is it that every new console game tends to run the same price when obviously the development cost are probably quite different between the games?

Software 'rental'

[glomph]

This is where it's headed. The Microsoft Tax paid monthly, or your machine turns into a 100% space heater(as opposed to 97% when running MS crap). Will be the best thing that ever happened to Desktop Linux (or other free alternatives).

Cheaper hardware is the reason for pirating....

[bernywork]

I have the distinct feeling that this isn't true.

1) I have a work PC, a home PC, a laptop, and a work PC at another site that I spend half my time at. Why does that mean I have to fork out for 4 X copies of Windows XP to keep the corporate standard so that I can connect into the network?

2) People see the OS as an enabler for the hardware, nothing more. People talk about Windows, it's the standard, they don't like the idea of paying for it, as if it's built into the cost of a PC as far as many consumers are concerned. A lot of people don't realise that they are paying for it when they purchase a new PC.

3) People don't mind paying a percentage of the cost of a PC for windows e.g. 10%. Now, the cost of an OEM license of Windows is about 1/5 or more the price of their PC. They aren't willing to wear it.

4) People have forked out for Windows again and again and again. They really want something new that will really impress them. (As a community, we really need this ourselves on linux to boot MS out of the market but nevertheless) They aren't recieving that at the moment because of the whole thing about it being the standard...

Either way, they are seriously lost here.

IBM bought Unix and made AIX as an enabler for the hardware they were selling, the market hasn't changed. Microsoft had better realise this fact and fast.

what?

[suezz]

gee steve I built my computer right at $110.00 - I went to local store and looked at the price of windows xp pro and it was $196.00 and I would have to buy more ram for windows xp pro which would increase the price of hardware even more - instead of that I downloaded fedora and it installed nicely and works great - does what I want it to do - so what was the point of his article. he is an idiot - how does he keep his job anyway - if somebody wanted to build a computer to use at home for the $100.00 budget they can - now if they want to put his os on it then it gets to be double and triple. just shut up steve - I am sick of hearing about your stupid remarks. do some research before you open your fat mouth.

Re:What's MS going to Do?

[Tooky]

Gaming is a specialised application, as such you'll buy specialised hardware to run it. Whether that specialised hardware is a console, or simply a video accelerator it doesn't matter. A system where a game runs from a DVD wouldn't be impossible, with save data being saved to your central repository. It can all still fit into the model.

You're probably right that a 1GB of storage won't be enough for everything though... but then storage will be much cheaper by then anyway.

Commoditization of Software not Hardware

[Facekhan]

Software is going to become a commodity not hardware. Hardware already is pretty cheap even while hardware development costs and productions costs often exceed the costs of a disciplined software development project. Microsoft has two cash cows and almost everything else they make is a flop at least in part because they are not disciplined spenders. Office and Windows are gradually waning as all cash cows eventually do and that waning is increasing. The software market is undergoing a slow but very major correction in the form of FOSS. Because competition was blocked by a monopoly and because the equipment and knowledge needed to develop a competing product were relatively widespread would-be competitors reacted by building their product in such a way that Microsoft's bankroll it uses to compete (or anti-compete) becomes mostly irrelevent. You can't buy out FOSS, you can't sue it out of existence, you can't target any specific company or person in order to get rid of it. FOSS is a response to the heavy handed tactics of Microsoft and to a lesser extent it is also related to a number of other near-monopolies that developed in the software industry.

Windows and particularly Office cost way too much. One would never think that in this age of 3d-games and super computers in the home and screensavers that cure cancer that an unimpressive package that does word processing, spreadsheets, boring presentations, and a seldom used database would be sold for $400. They simply fought all their compeitors to death or scared them enough to stay out of that market.

Software is what is going to get cheaper. FOSS software makes it possible to get the most use out of each line of code by allowing it to be used over and over by different users who have different needs.

The ever shrinking cost of a low-end PC have already commoditized hardware to about as low as it can reasonably go given that hardware manufacturers are not going to waste their time building old parts to sell for pennies when they can build new technologies to sell at a higher price. Then mass market them at the midlevel and then drop down the price to move out the remaining inventory when they announce something new at the high end.

Some components can get cheaper especially when sold at retail chains like CompUSA and BestBuy where a hard drive still costs $80 no matter how small. Its their minimum hard drive price. You will often see a drive going for 80 or 85 and it will be double the size of the one going for 79.99.

Re:What's MS going to Do? Cope, or DIE!

[davidsyes]

Driving those prices down will not be hard for manufacturers, as greater consolidation will continue to force smaller, or less nimbler, players out, or for them to thrive unexpectedly.

Unfortunately, and not regrettably, for microsoft, they cannot accept lowering the cost of their software. They are addicted to cash and power as junkies are to powder and temporary euphoria.

However, the AMD/Intel component of the equation must not be ignored. The equation must be balanced, and microsoft is the inequitable portion of the equation, NO matter what the claim to provide. As AMD & Intel and BIOS chip makers approach a symbiotic or near-convergence situation, computers will essentially be very mobile and OS independent or OS agnostice right in the palm of our hand. Promises will eventually be delivered, but microsoft will be on the low side of the properly balanced equation.

F/LOSS/Linux will drive the point home. It is inevitable, since the profit side of the F/LOSS equation is SERVICE-oriented, not charge-for-code oriented.

This is as it should be. Thanks to F/LOSS, maybe a new paradigm will emerge the victor for the next 20 or so years.

Re:I beg your pardon?

[l3v1]

Good point. And I add another one: I live in the EU, I have two engineering degrees and I earn ~$380/month. No, it's not the best I could get, but it's not the worse either (you could tell me to get my a$$ in the US and get paid, but I'm staying sorry guys :D ).

No way I would change my Debians just to pay loads of cash to Ballmer&co.

People Steal Because They Are Thieves By Nature

[geoffrobinson]

Why is this so hard to understand? People will come up with all sorts of explanations for their behavior. They do it because they can get away with it. Stealing in the retail industry is rampant as well. People are just stone-cold thieves. Now, software which is priced to high may make the rationalization easier, but in the end, you steal because you want to.

Apple proves this false

[Noksagt]

Mac hardware is more expensive than PC hardware (before any true believers jump on me, I'm not making any value judgement here). Yet Mac software is pirated disproportionally less than software for Windows. Yes, Windows is significantly more popular. Apple is said to have ~3% market share. But I would say there is more than 100 times more software packages that are more heavily pirated under Windows.

OK I'm going to state the obvious

[rcb1974]

Balmer thinks that if hardware were cheaper, people would have more money left over. If people have more money to spend, they can better afford Microsoft software. Balmer thinks that if people could afford Microsoft software, then they would rather buy it than pirate it. He probably thinks that it is less of a hassle to buy software than pirate to it. There are people who think the opposite for good reasons.

However, like traffic tickets and sales tax, MS Windows is a regressive tax; it hurts the poor much more than the rich. The solution is to scale the price of Windows so that it is a fixed percentage (like 10% maybe) of the total PC cost, but with a max cap of say $200. Under this pricing scheme, a $300 PC would cost $330 if you wanted Windows on it. A $10000 PC would cost $200 if you wanted Windows on it. That would make Windows more affordable in developing countries where cheap PCs are in high demand.

As far as the big picture is concerned, what Balmer ought to consider is what _Microsoft_ does that is wrong and evil. Exploiting the poor is evil. A lot of people simply don't realize just how _evil_ exploitation really is because they haven't lived in 3rd world countries. Strongarming businesses is also wrong. Releasing insecure software which forces IT folks to spend countless hours dealing with spyware, viruses, and/or trojans is evil too. No wonder Microsoft has an image problem!

I think the main reason why OEM hardware manufacterers still don't sell PCs with no OS installed is because Windows allows them to test their PC's hardware. This comes in handy when you have to provide support for your product. Instead, what OEMs should do is include test software on a bootable CD that tests all the PC's hardware. What do people think about this?

Re:What's MS going to Do?

[squaretorus]

so far as I can figure out you can still keep your accounting spreadsheet and those jpgs of your ex gfs boobs on a $100 PC.

so just what kind of sensitive data do YOU keep on your spanky expensive hardware?? or shouldnt I ask

I think that we're all missing the point.

[yaddayaddayadda]

Software is pirated because it CAN be pirated. You're gonna have a hard time pirating silicon. This is the prime difference between SOFTware and HARDware. Trust this, if Linux weren't open source, people would pirate it. People pirate software they will never use to it's full extent either. I wonder how many people have pirated copies of Autocad that they really don't know how to use at all. How many pirated copies of photoshop are used just for resizeing and converting image types? Why do people steal things? That's a real question. They steal what they think they "deserve". It's a real bullshit mentality. At least in the case of stealing Windows XP, people really do get what they deserve. Sorry I'm going on so long here, but new ideas keep popping up. Yes, I'm suffering from post before you think right now. Maybe it boils down to laziness. People will steal Windows XP before they learn to run Linux. People will steal Photoshop before they find out what other options that exist for less money or for free, as in The Gimp. So, who are the real assholes? Sure, Ballmer makes some pretty outrageous statements and basically exists to ruin the good names of the software developers and geniuses that work for him. But, the real assholes are the unwashed masses that allow companies like Microsoft to make products that actually push up the cost of hardware by being bloated and full of useless "features". Let's face it, without customers, a company means nothing. This is not to let MS off the hook entirely though, they do everything in their power (too much power) to keep customers "loyal". As stated in Full Metal Jacket, "It's a huge shit sandwich, and we're all going to have to take a bite." But that's not entirely true either. Believe it or not, Microsoft actually "helps" open source users by forcing an increase in the power of hardware systems. My Linux box really flies on some pretty cheap hardware. It's just a P3 1GHz/512MB RAM/GeForce 5200 and it runs great. Most people wouldn't even purchase a system with those specs if they saw it in a store. I'll tell you what, I bet it runs better than most P4 systems sold with windows in most cases the average user comes across. It's not that I can't afford a fast computer, I'm writing this on a G4 Aluminum PowerBook, a computer I was proud to pay a ton of money for. Anyway, Ballmer, you may be right, statistically, but philisophically, you're dead wrong man. Matt

Not Cheaper hardware.. DRM hardware

[nurb432]

Saving a few bucks on your PC wont effect the fact that the software is overpriced. These days the hardware is not the prime factor in cost like it used to be. ( unless you go for one of those esoteric gaming machines or special purpose workstations )

However, if they have a hand in the 'specs' of these new low cost PCs, you can bet they will be so restricted that using anything that is copied ( or not approved to execute ) wont happen..

its a switch of cause and effect to please the uninformed masses..

Re:Actually...

[aristotle-dude]

If this was true, mac users would be pirating "more" than PC users because their hardware is more expensive right? Funny how it seems to be the other way around.

Re:What's MS going to Do?

[BasilBrush]

Then it's not the difference in price of the hardware at all. It's the reduced price of the Windows mini-me.

Reducing the price of hardware to less than $100 has no reduction effect on piracy. Indeed increasing numbers of poorer users are likely to increase piracy absolutely and as a percentage.

The real thought in Ballmers mind is that a fundamental redesign of what people refer to as a PC to something like an Xbox 2 with PowerPC processor crossed with MSN TV would enable them to get full blown palladium implemented without the the requirement to be backwards compatible with older software. That's the sub-text here.

why do you care?

[popisdead]

Steve Balmer has nothing intelligent to say. Who keeps getting his quotes, from where?!?! are they actually getting them from, and why or how is this slashdot news? I come here to read news posts that are interesting. Not soap opera media attacks.

This should be a wakeup call for hardware venodrs

[Anonymous Coward]

I wish I could post this logged in, but due to some biased moderation of what were intended as jokes I can't. Slashdot sucks munkee bawls.

This should be a wakeup call for hardware vendors to DROP M$ LIKE A ROTTEN POTATO .
They've just come out and said, you guys don't provide value to the equation, we do. We want the biggest part of the pie.

The Dells and Gateways of the world can still make their piddling single digit margins selling their hardware the penguin people just as well as 'doze users. (Hell, if they don't have to pay the M$ extortion, that's more money for them).
Microsoft, on the other hand, has nothing else to offer. They must convince consumers that they provide some sort of value for their money.

The only way M$ can make a rational argument for this is in a package lease kind of deal, where the customer coughs up $25 / month. Out of that, the pie has to get split up among : 1) the hardware provider, 2) the ISP, 3) the software providers.

Re:What's MS going to Do?

[Simonetta]

Dear Leader Ballmer was probably thinking along the lines of the fabulously successful RIAA model. That is, the consumer buys a portable CD player for $25 and then a constant string of CD purchases for $15 each.
He'll probably point out that the customer is 'saving' money with the Microsoft model, where they buy the PC for $100 and then the Windows for another $100 just once. Or at least until the next $100 upgrade.
The general consensus is different. A lower PC cost would make it less likely that people would buy an operating system that is 50% or more of the cost of the PC.
I have never accepted the idea that the 'operating system' is a seperate component from the computer and should be purchased seperately. I have always just made a copy of what's available from friends and work and used it.
Having a computer and operating system sold as sererate components makes as much sense as having the auto industry be in the practice of advertising and selling cars routinely without steering wheels. Then by historical quirk and tortured legalities offering the steering wheels for $1000 extra. Then having a dumpster behind every auto distributor full of perfectly good steering wheels that people can install in their new car for free.
It's a totally absurd situation and I don't feel the slightest bit of guilt rejecting it. All the basic fundamental research in computer science that led to OS development in the first place was done with US taxpayers dollars. MS coders were just recoding the same routines, data structures, and algorythyms that taxpayers paid for previously in military R&D. Nothing new has ever been developed north of the California border.
My first five computers (Radio Shack MC10 CoCo, Timex-Sinclair 2000, Atari XL, Apple II, Commodore 64) had no seperate operating system requiring seperate purchase. The idea that I'm going to pay the richest man in the world $100 for something that was deliberately left of the computer is absurd and insane. Don't even bother to ask anymore, it's never going to happen.

Re:Denile is a Bitter Surprize.

[Big Mark]

There's nothing stopping OSS projects buying a fancy pants design from a professional and releasing it under the GPL - if you give a designer (espescially new ones with zero reputation, who'd love to list your app in their portfolio) enough money for a design he'll give you the intellectual property rights in it, and if you choose to release your IP rights under the GPL, there's nothing anyone can do to stop you.

excepting lawsuits

It's a trick! Get an ax!

[Anonymous Coward]

By the time hardware manufacturers can produce a decent PC for only $100, the hardware will be crammed full of all kinds of DRM goodies to prevent you from illegally copying or using illegally-copied software.

The low cost would just be an inducement to "upgrade" to a shiny new computer that will only let you do what They wany you to be able to do with it.

Re:What's MS going to Do?

[TiggertheMad]

My first five computers (Radio Shack MC10 CoCo, Timex-Sinclair 2000, Atari XL, Apple II, Commodore 64) had no seperate operating system requiring seperate purchase. The idea that I'm going to pay the richest man in the world $100 for something that was deliberately left of the computer is absurd and insane.

What do those computers you mention have in common? There were 'no seperate operating system(s)' to purchase. You got them with the computer (and paid for them in the purchase price, even if you were not aware of it) because you had no choice. If I recall correctly, Bill made money by creating an option.

1987. I am programming away on my parent's Apple 2e, and my dad brings home a copy of something called 'MS-DOS'. I couldn't figure out what it was for, until I realized that I could use it instead of Apple DOS. (Ironically, I thought it sucked. Guess I was ahead of the times...)

Don't pay $100 to Bill for an OS if you don't want to. But, to call it insane that you actually have the option to use a non-propritary OS on your computer is...well, insane.

Hmmmm ... what about Apple ...

[adzoox]

That's interesting considering that greater than 90% of all installed Macs have completely legitimate software on them .... the last time I heard that number was below 50% (for a totally legit system) on the Windows side.

And since Apple hardware is more expensive (at least initial purchase) then this hardly holds any water.

Ballmer's WRONG, hardware is cheap. Numbers here:

[Ralph Spoilsport]

Let's double the cost of the computer he considers too expensive, from $500 to $1000, and skip the obvious discussion of the MS tax - we'll stipulate that it's a Windows machine, even though I use a Macintosh. This is not a point of practicality, just a point of economics.

Now, let's see: I want to get MY work done.

My clients are in video, audio, web, and print. I need:

Adobe Photoshop
Adobe InDesign
Adobe Illustrator
Macromedia FreeHand (because I like to work in it better than Illustrator)
Macromedia Dreamweaver
Quark Xpress (for cranky or fussy printers who are still runnning Quark 4 on OS9 or 2000)
Macromedia Fireworks
Macromedia Flash
Ableton Live (for music development)
Adobe Audition (for Windows based destructive editing)
Propellorheads Reason (for composition)
AVID DV Express, Pro edition (for video)
Adobe After Effects
Adobe Premiere (because it comes with the Video Bundle)
And, of course, MS Office

TOTAL COST OF SOFTWARE?

Assuming I buy most of it in Bundles (Adobe Creative Suite, MM MX suite, etc.) I come out to a rough number of:

$7700

At that point, a $1000 computer is one of THE LEAST of my expenses. When you bring in a DV camera, a decent audio ADC, Firewire RAIDs, scanners, printers, and similar crucial items, a $1000 computer becomes even less of a cost to the total operation. A $500 computer becomes insignificant - heck - it's almost impossible to find a decent multichannel audio ADC for less than $600.

Ballmer is COMPLETELY wrong, or, more likely: HE'S LYING. SOFTWARE is the expensive item, followed by peripherals. The last item is the computer. The expensive part of the computer is not in its cost, but in configuring it to one's needs, which takes time (which is extremely expensive) software (which isn't cheap) and peripherals (which can be cheap or extremely expensive).

RS

Ballmer cracks me up

[carldot67]

I have SEVEN "sub-$100 machines" in my care. Assorted P75, 133, 200, 350 and they all run either Linux or BSD. None of them are capable of running Win 2000 or XP.
Ballmer forgets that the reason people have expensive, high-spec machines is because THATS ALL XP WILL RUN ON.
Good lord, Steve, get a clue!

It's a fixed size pie...

[rnturn]

... and Microsoft wants a bigger piece.

``Does he think that cheaper hardware will make copying software harder to do?''

Nah. My theory is that Ballmer sees their problem as people are spending money on hardware that Ballmer thinks they ought to be spending on software. Every dollar that Intel/Dell/HP/etc makes is a dollar that Microsoft didn't make. No one should be expecting Microsoft to be lowering their prices in lockstep with any price reductions that the hardware vendors put into place.

What Microsoft is hoping for is a situation where cheaper computers are in the hands of the masses resulting there will be an even bigger demand for software. What they don't seem to realize is that, for poorer countries, that could easily mean an even bigger demand for counterfeited software. Or the folks in those countries will just load a free OS on those computers. Microsoft would like very much to prevent that from happening. (Good luck with that.) The trouble is that someone from a poor country has a small set of choices. Say they've got $500 to spend. They'd like a computer (perhaps so they can become computer literate and work for one of those outsourcing companies):

• Option 1: They look at a computer with Windows+Office. It costs $500 which includes a $100 computer and $400 worth of Microsoft software.
• Option 2: They can get a $100 computer with $40 worth of a commercial Linux distribution and have an extra $360 left over to feed their family.
• Option 3: Get the $100 computer and borrow Linux from the guy down the street. Now he's got $400 more for food.
• Option 4: Get the $100 computer, use a ripped off copy of Windows. He's still got the extra $400 for groceries. And if the buyer is a struggling small business, a chance to win a visit by the local police and a representative of the BSA. Oddly enough, this can happen if they choose Option 1. (What an incentive to go with Microsoft. Where do I sign up? :-) )

Ballmer seems to think that people will choose Option 1. I would contend that Option 1 is the last choice people will make. (Me personally? I'd go with Option 2 since it allows me to support the OSS "industry".)

Some day they'll understand that the world is not always looking for ways to send their hard-earned money to Microsoft.

Re:We're on the way there...

[Anonymous Coward]

I've been using Macs since '95 and I've been told by "experts" that OpenGL and other cross-platform standards would make gaming available thru all platforms.

I was very happy because Macs are always lagging behind Windows PCs in game availability.

That simply isn't holding true because most developers are using DirectX (DirectSound, Direct3D, etc.). It gets even worse: most graphics cards have Direct3D acceleration built-in and the it seems rather clear which API developers should use *to get to the major audience*.

Yea, I know these very same cards offer OpenGL acceleration, but it's not so tempting to the developers for some reason. ;-)

Conclusion: as long as Microsoft dominates the market, developers will still use their (MS's) API's, cause they're coding with Windows in mind in the first place. As long as these developers keep doing this, Microsoft will keep dominating.

Damn! I just want to see Half Life 2 coming to the Mac!

Re:What's MS going to Do?

[Daytona955i]

It's called a network PC... it was tried, it failed. It's rumored to be making a comeback but people want to own things... not rent them, and here I would classify software as a thing.

The other bad thing about network computers is that you are at the mercy of the people who maintain the programs to install the latest programs and hopefully have what you want. I could see it work in an office environment but not for home use.

The only reason he claims this is that a lower cost of hardware would allow them to raise the price of their software. Personally I think it's the high price of software that causes rampant piracy. I mean if you could get windows for $20 would you pirate it?

MS gets it backwards again...

[kidMike]

This is like saying that starving people in "Third World" countries simply need access to cheaper silverware to eat with...

kM

Re:What's MS going to Do?

[Anonymous Coward]

If you got MS-DOS to run on your Apple //e in place of any Apple Operating System, you were WAY ahead of your time. To do so was simply impossible without an ungodly-expensive piece of implant hardware that was basically an entire IBM PC on a board, and even then you still had to run the Apple OS on the host hardware to activate the implant hardware.

But nice try. I see you even managed to fool the mods into believing you.

Re:What's MS going to Do?

[Anonymous Coward]

"1987. I am programming away on my parent's Apple 2e, and my dad brings home a copy of something called 'MS-DOS'. I couldn't figure out what it was for, until I realized that I could use it instead of Apple DOS. (Ironically, I thought it sucked. Guess I was ahead of the times...)"

HUH?? I liked the rest of your post but unless I really missed something, how did you manage to take MS-Dos and use it on an Apple that uses different formatting on th disks and a processor with completely different instructions? I guess I'll have to whip out my apple ][e out of the garage and slap in my ms-dos 1.1 boot disk and watch the amazing transformation.

cheaper hardware means more expensive software

[Anonymous Coward]

Some have said that a decrease in the price of computers will cause a decrease in the price of software. This isn't true.

Since they are compliments, a decrease in the price of computers actually results in greater demand for software and an increase in price. This is simple beginning college economics.

A simple example of this is to consider what has happened to the price of software as computers have gotten cheaper over the last few years--price has actually gone up. Software is more expensive now than it was 5 years ago.

What Ballmer is doing here is advocating lower hardware price precisely because he knows it means Microsoft will be able to set a higher price for Windows as there will be more demand.

No need to worry however, as influential as he may be, he certainly isn't powerful enough to lower hardware price just by saying it should happen.

Yes, Make your HW cheap so MS can still overprice!

[Jackie_Chan_Fan]

This is silly. So nvidia, intel, all the board manufacturers lower their prices so MS and the other corperate software giants can still sell their software at insane prices? "hey make your stuff cheaper cause they cant afford ours" Doesnt work.

Really cheap computers

[budgenator]

How about Linux on a Xbox? If Microsoft is losing money on the game console and expecting to make it back on game disks ala the Gillette Biz Plan, then Linux on Xbox would be the death-of-a-thousand-cuts!