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Linux's Role In Microsoft's Decline
nerdyH writes "As early as last quarter, Microsoft admitted that Linux and netbooks were eating into its fat profits. Recently, it came home, with the software giant announcing its first-ever layoffs. LinuxDevices interviewed Linux Foundation Director Jim Zemlin on Linux's role in Microsoft's misfortunes. Zemlin sums it up pretty well: 'Companies can offer their own branded software platform based on Linux. If Microsoft is getting 75 percent margins, you would like some of that high-margin business, too.'"
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Yeah, it couldn't be because there is a massive economic crisis going on. It's all Linux.
Microsoft is getting beaten down by Apple at the high end and by Linux on the netbook space. Obviously, I don't mean that people are buying linux netbooks. Hold your horses there. But MS's bargaining position has changed because of linux. They could have said in 2002 that netbooks should cost $600, because of the $200 windows copy. But that does not apply anymore. They sell XP for $28-$32. This is a huge relative loss to what they were making.
And at the high end, Apple is all over it. Take a look at bestbuy. It is rare to find a $1000+laptop, Apple notwithstanding. Or take a look at Amazon's best seller list, only to find hordes of netbooks and macbooks, perhaps with a 1 in 20 Vista machine.
To make matters worse (for MS), if these high-end phones and proposed tablets such as the techcrunch one come to life, they won't be using windows. Nothing below $300 can afford windows, even at $32.
Finally, MS's stock price has been walking sideways for years and years and years. They cannot bring the best talent in the basis of money or stock options alone. This is not the year of linux on the desktop. But its presence is being felt in the markets undergoing disruptive innovation, like the netbooks.