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Google is Microsoft's New Open Source
Robert writes "Steve Ballmer told investors recently that Microsoft's biggest challenge is embracing software-as-a-service business models, as
embodied by rival Google Inc. Investing in software as a service and advertising-supported businesses is a challenge
like that which the company faced at the dawn of the open-source movement. To paraphrase
him heavily, the takeaway was: Yes, we're investing a lot, but it's riskier, long-term,
not to do so. We have a lot of cool stuff coming up and, yes, we are also playing catch-up
on a couple of fronts. His speech came a
month after Microsoft revealed that its R&D budget for fiscal 2007, which ends
mid-2007, would rise to $6.2bn." From the article: "We've
got to make this transition, which our industry is making, from software as a product to
software as a service ... If you want to be a leading software
company, you've got to be a leading software-as-a-service company."
Microsoft has real competition, forcing them to develop better, more competitive software. Downside?
Excuse my speling.
Making The Bar Project
We have now found the perfect slashdot headline.
All the key memes are there.
We need continue no longer.
Athletic Scholarships to universities make as much sense as academic scholarships to sports teams.
Ever the follower, never the innovator.
Go ahead and call me unreliable; reliable is just a synonym for predictable.
Microsoft will gladly embody software as a service. Infact, it might as well be their idea, as they are going to be generating much more revenue by doing this, effectively screwing the customer who has to pay more for the same poorly written MS code, and the customer will be more along the lines 'renting' the code since the eons of service renewals will never relent.
The 'software as a service' structure could be one of the worst ideas ever. Google offers actuall services, to mix it up, Microsoft on the same terms would be taking the whole idea out of proportion. You don't want to have to, essentially, RENT Microsoft Exchange Server, for example, would you? As compared to Google, the software they do distribute is completly free.
This is vaguely similar to the RIAA, etc wanting us to merely rent music, or repurchase it in a new format every so often, instead of owning it outright.
Music as a service. Software as a service. What's the difference?
"It is a greater offense to steal men's labor, than their clothes"
from Microsoft or anyone else. I will either use OpenSource software that's free (as in beer) or in cases where I must have some functionality that's only offered in a proprietary package, I'll buy software outright. If the only way to get a particular bit of software is to rent it, I'll go without.
:-> ) though I needed it enough in 2000 that I dropped the cash. (I don't do warez, so that's not an option)
Lots of the software that I use on a daily basis hasn't been updated in years. This is especially true of expensive packages like FrameMaker (5.5.6), Illustrator (v 10) and other software I purchased for consulting work back in the day. I'm not dropping another $600 on FrameMaker for the minimal feature updates (although I hear 7.0 has multiple levels of undo
I run Office 2000 (it came "free" with a PC) on my one Windows box, and don't see a compelling reason to upgrade. I certainly won't be paying Redmond a monthly rental fee to run an office suite. I allow Google to display ads, but I'm not paying Google any actual cash and I've pretty much trained myself so that I don't even see the ads anymore. Ballmer & company still don't get it.
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Maybe they will throw a couple hundred millions at wine, make their own distro and then offer services around it? I doubt they will do that soon, since that would hurt their bottom line for the moment. But as soon as the other business model promises more profit they could be able to make the switch if they are prepared. As far as I understand they are getting ready.
So maybe it is not time to dump your MS stock just yet.
Like with the Xbox they would enter a competitive market. Maybe then they will make better products. At least they should be able to, considering all the brain power they are sucking up every year.
So, their new challenger? Would it be more accurate to say their "additional" challenger?
Nah. Microsoft can't concentrate on more than one opponent at a time.
The funny thing is, I can't tell whether I'm being facetious, either.
I got my Linux laptop at System76.
Our personal thoughts about Microsoft, Pro or Con, are not that relevant in the larger scheme of things. If we look at Microsoft's total suite of products as a fairly well integrated (and improving) stack of platforms, tools and user interfaces for collaborative work, then the move to Software as a Service is both logical and perhaps ultimately the way everyone will go.
There are some many possible threads here that it's not possible to give a coherent discussion when I'm here at work, but here are some of the ideas that come to mind as an advantage of the concept from a somewhat Microsoft centric perspective:
Shortness of time limits clarity on these ideas. Resolving them in our discussions here can be fun, but I think Microsoft should pay us for the privlege. Don't you?
These are all areas where Microsoft can bring a very rich user experience that will drive the competitors to greatly improve their offerings. It will also force Microsoft to be more open and accessible to other vendor's products, solutions and open standards. Resolving all the issues involved will take a long time. I've been involved with these discussions for over a dozen years now. I expect it will take another dozen for these things to work as well as we imagine them to.
There's another point that's been made by others too. Moving from a license per box to a license per use and even mostly free stuff business model will be painful. Look at Novell. One of their biggest revenue problems is that the move to FOSS has occurred more quickly than they expected driving revenues down faster than they'd planned and could adjust for.
Microsoft will feel similar pain, but is learning from all the pioneers how not to get shot in the back. It is what they are best at
A hammer is not a "service." A paintbrush is not a "service." A car is not a "service." They are tools. And, unless people use them very infrequently, people don't rent their tools. They buy them so that they may own them. Software follows this analogy to a very high degree. Software is a tool and, as such, the market for "rented" tools is way way smaller than the pundits are predicting. This will become even more true as Open Source solutions continue to make inroads and force aside overpriced proprietary solutions that are buggier and offer almost no extra compelling functionality.
Microsoft does know how to Pwnz0r and expand existing markets but, so far, they have largely failed to create new ones. Software-as-a-service is a dead end, especially for a company the size of Microsoft.
Schwab
Editor, A1-AAA AmeriCaptions
What's with all the rants about renting software. That's hardly the point of the article or service-based software.
Service based software has many revenue streams and powerful advantages. First, it'd be great to have a virtual desktop that followed me whereever I logged into. Not only do my files follow, but I can login to a kiosk and actually edit my Powerpoint before a presentation (without the danger of locally saving it). This is a great model (with enough bandwidth) that facilitates collaboration and mobility.
Second, many companies are already paying through the nose for a similar model. We pay hundreds of dollars/year/user for PC service support with software. Many folks only occassionally use the MS apps, but we have to buy licenses for each PC. It would be FAR cheaper if we could centrally host the applications and pay by usage. And this would also enable us to automatically backup files and allow users to access programs from home. Users often lose data when their desktop crashes. No more with service-based software!
Third, look at the Turbo-Tax model. It's $70 for the desktop version (PLUS electronic filing fees) and $20 online with FREE electronic filing. The service based model would be similar. Pay $500 for MS Office or $40/year to use/access the same thing. It's likely to be MUCH cheaper.
Fourth, they'll also license it to folks like Google who will then provide it to us for free (or VERY cheaply as a premier member) as a service and part of their total desktop management.
Just wanted to point out that there's many good things about this. Dismissing anything MS does simply because it's MS totally misses the point. Sure, it could (and might) suck, but it could also be a great thing.
It's still missing a speculative question mark and the word 'killer'.
Bot Assisted Blogging
MS sells primarily Windows and Office. As I understand it, that's where their primary revenue comes from.
Windows 2000 or XP should be good for a long, long time. Remember Ballmer's famous "developers developers developers"? What's implied in that is that the developers want to reach as wide of a target as they can - that's why they're writing for Windows in the first place. The wider the target, the more software the developers sell. In short, to be operable on all flavors of Windows. Just last year I worked on a product and as part of QA we had to verify that it ran on Win95! Versions A and B!
So IMHO, that pretty much makes Vista optional - and it's going to be for a long, long time. Unless MS figures out some amazing way to get the developers to aim for a smaller locked-in target. I mean, think about how many machines are out there running XP today. How is MS going to tell all of those people to stop it, upgrade, and start paying MS rent?
And as for Office, if it's on a pay-as-you-go model, no business will stand for that for the same reasons. Again, they're competing against earlier releases of Office. And OpenOffice. Soon as a halfway competent accountant runs the numbers, the pay-as-you-go model will be avoided.
I'll betcha Vista and pay-as-you-go winds up being Microsoft's next Windows ME. Nobody will touch either with a ten foot pole.
Weaselmancer
rediculous.