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Why Microsoft Shouldn't Worry About Cannibalizing Their Userbases
New submitter coyote_oww writes "A ComputerWorld analysis article suggests that Microsoft should stop worrying about one product cutting into another product's sales, and concentrate on putting their best foot foward regardless of the impact on product lines. The big impact would be the price of Windows: '... Microsoft must, at least in the main, sell devices based on lower prices. And the only significant component of a Windows-powered device that can be cut further — hardware margins are at or very near the bone, and have been for years — is the Windows license.' It's still possible they could sell Windows versions at different rates for different devices, but that could get hard to justify to consumers over the long haul."
You know what I want? A lower-cost Windows targeted at gamers. I don't need drivers for scanners, printers, fax and other unnecessary crap if all I do is play games on it.
A Windows with less processes running would also mean a faster computer able to dedicate more resources to the games instead of crap I don't need.
Get free satoshi (Bitcoin) and Dogecoins
The article is on ComputerWorld, which is owned by IDG. They are quoting a research analyst from IDC, which is also owned by IDG. What's the motivation for writing this article?
Some people die at 25 and aren't buried until 75. -Benjamin Franklin
Steve should consider throwing his best chair forward.
A feeling of having made the same mistake before: Deja Foobar
from the article: "As part of the reorganization, Microsoft will consolidate all of its client OSes, including Windows 8, Windows RT, Windows Phone 8, Windows Embedded and Xbox, into a single engineering group [...] The Windows desktop client and mobile have a lot of common functionality, and a combined group could have a lot of synergy".
I fully agree, that's a good strategy (and it was about time)... oh, and one o the few times the word "synergy" makes sense!
The motto of the CEO at a company I worked for many years ago.
The real "Libtards" are the Libertarians!
Cannibalize your own product line before the competition does is an obvious necessity, yet it is the hardest thing for managers to actually do.
If Slashdot were chemistry it would look like this:Cadaverine
the introduction of Windows Genuine Advantage.
Before WGA was introduced, most people thought windows came free when they purchased a new computer. The rather high price for the OS was completely obfuscated. The cost was hidden because there was no impediment to installing a copy onto any machine so they thought it was free. All you needed was a copy. Well, MS decided they wanted to get paid for all of those installs. So, they introduced WGA. So, what happened... Well, people still bought new machines... But, when they went to use the new OS version on their old machines it didn't work because it could only be validated on one machine... Now, people still wanted the new OS so they went to see how much it cost and they were horrified by how much a copy of windows cost.
This left people with four choices:
1. Don't upgrade... (Look at how long it has taken to get people to stop using Win XP.)
2. Pay the high price. (Probably not)
3. Bootleg a copy. (Bit-torrent has lots of copies)
4. Look someplace else. (Have you noticed how well Apple has been doing lately)
Notice, in all but one unlikely scenario, MS doesn't make anymore money than they did before the introduction of WGA. But what they have done is enlighten people to the true cost of MS windows. Additionally, when someone doesn't upgrade or goes with an alternative to Windows, then third party applications suffer because the installed base of the current windows is diminished...
MS quite simply destroyed their own monopoly by trying to get people to pay for something they would never pay for.
Every time MS releases a new OS I keep thinking they would figure this out and drop WGA but they keep on striving for a smaller and smaller market share.
Simply put, having a solid monopoly is MUCH more valuable than the few sales they have made as a result of WGA...
Oh and lets not forget, WGA just pisses people off so as a paying customer... You get punished... Great business model if you want to shrink your market share.
The article talks as though Microsoft is a monolithic entity that will like a single intent. Like any large organization there it is a conglomeration of parts and they mostly act in their self interest than the interest of the whole organization. Most of the time there is a large overlap between the self interest and interest of the larger body. But Microsoft has some perverse incentives like giving part of the revenue stream from a product line as compensation to the top managers of that line. Sounds great in theory as a motivation factor but it can backfire too. These people in top management well versed in the palace intrigues have to let some other part cannibalize their revenue stream for the interest of the organization as a whole. The track record is they won't. Only when the "partner level" managers' bonuses (or is it bonii?) are tied to the over all performance of the company, not the individual parts under their control, they will let internal cannibalization. But letting their bonii depend on large parts of the company they have no control over is a tough sell too. It is a problem that developed over a long time. It won't be solved in short time.
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
Release windows for free, and we will finally see how it competes.
TFT (the fine title) suggests that they can still charge for windows as long as they keep eating the windows users (or only their bases?) without worry - and this "without worry" is somehow the miraculous key to the solution.
Not for free but they need to understand that as you suck harder and harder on the udder of a cash cow the less friendly that cow will be to you and will dry up or kick you in the head.
At this point it is difficult to believe that MS has not realized an honest profit from the honest investments it has made. They have done a lot of service but there is a point when the business model must change.
Worthy computers can be had for yuppiy pocket change and free software has gotten well beyond the experimental stages. Especially in server land.
The home computer model has changed, and there will be less and less need for WindowZ. My smart TV has more compute power than my early on desktops. Which were well beyond my 6502, MC14500 and 8080 processor based projects. It is a new day, MS and many others need to take stock or see their financial models fall apart.
Servers and server farms will grow.... but be in the hands of a small number of companies. In the price range of a UPS delivery van small companies will have local computer resources than can be installed and serviced by folk at an equivalent level of a USP van driver. Yes the Brown UPS vans are a marvel of technology but they make money delivering packages shipped for sub $10... that is astounding.
Chromebooks and the new XO tablet are showing that the old models are fragile and new ideas are welcome.
Raspberry-Pi and project boards like the pandaboard and Beaglebone Black are showing that sufficiently interesting hardware need not cost a lot of $$. Invest $100 in these school and development boards and revisit your education.
The future is at hand -- yet again.
Truth is stranger than fiction, but it is because Fiction is obliged to stick to possibilities; Truth isn't. Mark Twain.
I routinely use both Linux and Win7, depending on the client I'm dealing with.
A well set up Linux is easily the more responsive environment, and has less annoyances and inconsistent behaviors than the Windows equivalent. Simple stuff like using USB drives or wireless networking just works better. Switching back to W7 feels like wading through glue after a day or two on Linux.
If both OSs were priced the same, had identical OEM and software vendor support, I have no doubt people would largely choose Linux.