On Jul 24, 7:10 pm, "Ezekiel" <y...@xxxxx> wrote:
> "Rex Ballard" <rex.ball...@xxxxxxxxx> wrote in message
> news:799e566b-2a2f-4755-a439-20dd268963da@xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
> > OEMs buy windows because they believe that it will help them sell more
> > computers.
> DUH! Do ya think that's why?
Actually they buy Windows because they believe it will help them sell
more computers AT A HIGHER PRICE.
Just selling more computers isn't enough. If they don't make a profit
on those computers, and enough of a profit to help them deal with slow
periods and adverse conditions, then they might consider other
alternatives, over the last 25 years, the OEMs have have considered
alternatives to Microsofts OS du jur, including DR-DOS/GEM, OS/2,
UnixWare, SCO Unix, Solaris, and Linux.
Of course, Windows NT 3.x, Windows ME, and Vista did not result in
substantial increases in sales and profits. When these systems were
released, initial premium prices quickly eroded into deep clearance
discounts, unsold inventory, and losses. If you are losing 20% of
your cost on every computer sold, you can't make it up in volume.
Gateway tried and went from a $35/share stock to a $1/share stock and
would have been de-listed if Acer hadn't purchased the whole company
at a "Fire Sale".
> > If Linux will help them sell more PCs than Apple, or the
> > other OEMs, and at a higher retail price, then they will start
> > installing Linux.
> Wow. And all this time the "advocates" said that Microsoft *forced* them not
> to sell linux. So how 'bout that... OEMs sell the hardware that will make
> them the most money. Ya learn something every day.
Microsoft's contract terms were designed to exclude competitors,
including Linux, OS/2, and UnixWare. This has been the case since
Windows 95, when Red Hat offered OEMs Linux for $2/machine for
installation in a "dual-boot" configuration. Microsoft demanded
exclusive control over the entire "boot sequence" from power-on to the
final display screen.
Microsoft tried to get around antitrust issues by saying "changes
require Microsoft's prior written permission", and OEMs and Vendors
have been allowed to make trivial changes such as adding their own
trademarks to the screen, adding applications to the desktop, or even
different backgrounds. These types of changes get approved very
quickly.
On the other hand, requests for dual-boot and virtualization
configurations have generally taken much longer to get approved, and
often the requests for such changes get "lost". Appearantly,
Microsoft has some guy who is on vacation more than President Bush,
who has a huge in-box piled high with such requests, and every few
months, the stack "falls into the waste-basket". It would have to be
an accidental misfiling, since deliberately throwing such requests
into the trash would constitute a violation in the complaince
monitoring requirements of the DOJ settlements.
Normally, Microsoft also offers discounts for these concessions, even
if the discount is only a few cents per machine, it absolves Microsoft
of responsibility, since the OEMs got consideration.
This year, Microsoft has been getting more revenue for roughly the
same number of licenses, which indicates that OEMs are paying more per
license, even though the license prices are public record (DOJ
settlement requirement). This would indicate that the OEMs are not
accepting the discounts for the restrictions, because they are losing
too much market share to Apple.
Remember that Apple has a deal with Microsoft which allows Apple to
sell machines with OS/X and Windows as a Virtual "client". My guess
is that HP, Dell, Acer, and Lenovo want similar options with Linux.
> > Note that
> > Xerox, Kodak, and other companies have a number patents which are not
> > available to Microsoft, but are available to Linux. Many of them are
> > critical elements of X11.
>
> Not available or not applicable? "Not available" implies that they won't
> license their technology to MS which is total bullshit because if they could
> make more money by licensing something to MS than they would. "Not
> applicable" means that Microsoft has no use for a particular patent.
Xerox wants to be paid for all the stuff Apple and Microsoft stole
from the Palo Alto Research Center back in the 1980s, the core of
Windows and Mac. Xerox did not force their people to sign the
"everything you ever invent is ours" nondisclosure agreements that
Microsoft and Apple now require of pretty much anybody who visits,
because they assumed that they were dealing with ethical and
responsible people (part of that Rochester NY mentality. They found
out too late, that neither Jobs nor Gates had any sense of ethics or
integrity when it came to ripping off PARC technology without paying
for it.
Xerox isn't the only one. IBM, HP, and DEC (now part of HP), were
similarly ripped off by Microsoft, and even though Microsoft made
limited restitution, it was similar to the "software coupons"
Microsoft gave the schools in it's settlements.
Microsoft's settlement with IBM included licenses for Windows that
could be co-resident with OS/2 and WARP. Then Microsoft demanded that
IBM kill off Warp 4.0 and sell Windows (95) exclusively. IBM and
Microsoft fought bitterly until Microsoft finally had no choice but to
give IBM a very cheap license, or face FTC problems, since the IBM
logo was in a prominent location as a Windows 95 supporter, and IBM
was ready to report the use of their logo as Fraud.
Microsoft's settlement with DEC was to write a version of Windows NT
for the Alpha chip, but only the OS was provided. None of the
applications worked on Alpha and the performance was horrible compared
to UNIX or VMS (Microsoft didn't bother to optimize).
Now, the wheel has come full circle, and the OEMs, including HP (who
now owns what used to be DEC) and Lenovo (who now owns what used to
be IBM's PC business), are looking at Apple's rapidly increasing
market share, and pretty much demanding the ability to offer a similar
package, with Linux as the primary operating system, and Windows as
the VM Client (same configuration as Mac).
If Microsoft doesn't make the deals, they risk losing market share to
newcomers such as ASUS, Everex, and even Panasonic, who have been
building a business based primarily on Linux, with Microsoft trying to
get a "back seat" into those markets.
One thing is for sure, Vista is not delivering the high profit margins
and volumes that had originally been forcast, and customer resistance
is very strong. Many corporations are refusing to place orders now
that OEMs are not offering XP as a preinstalled option. Others are
testing for compatibility with both Linux and their corporate XP
licenses, and those who don't make the cut (especially with Linux)
don't get ordered.
I've also noticed that almost all of the PCs made by HP, Lenovo, and
Acer are "Linux Ready", compared to about 60% in 1999, 70% in 2001,
80% in 2003, and 90% in 2006.
My guess would be that volumes of the "Linux ready" machines,
especially in the corporate market, have shifted by even higher
percentages, perhaps as much as 98%.
If Microsoft is willing to be reasonable, the OEMs will continue to
buy Windows/Vista, but they are more interested in getting those
licenses so that end users can install Linux and then legally use
Windows and it's libraries with WINE or with VMs such as VMWare, Xen,
or the other new players in this market.
These days, it takes about $100 and 2 hours to take an existing XP
laptop or desktop machine, generate a VMWare "appliance" using VMWare
Converter, saved to an external USB hard drive (that's the $100),
install Linux and VMWare Player, and move the VMWare image back to
the Linux box.
If you purchase a machine with an OEM license for anything other than
Vista Home Basic, you can legally do this, without violating the
Microsoft license. Microsoft tried to prevent this type of use of
Vista Home Premium, and had to back off when OEMs reported that these
machines were "rotting" on retailer shelves.
This was the first major concession Microsoft has had to make. In
addition, they had to permit Dell to offer "downgrades" to XP to those
customers who wanted it.
Who knows what other concessions will be surfacing this year
(Contracts are negotiated in June and July, and the resulting new
offerings surface in August and September.
I suspect that we will be seeing more machines with "Linux in Flash",
and more machines being shipped with both Linux and Windows
partitions, or Linux as the native OS and Vista as a Virtualized
system. This is the trend we have been seeing in the server market.
We may also see more Linux powered laptop and desktop machines in
retail stores. Retailers have been pretty badly burned by Vista, and
Linux might be just the kind of "new and different" they need to
generate some profit margin from PCs. Most of the retailers have been
sitting on "dead" inventory and end up having to give very deep
discounts in "manager's special" or "fire sale" prices. Essentially,
they are taking the loss because in a few more weeks or months, they
would have to pay to have the machines "recycled".
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