08.05.09

Why GNU/Linux is Microsoft’s #1 Desktop Threat, Shareholders Are Finally Being Informed

Posted in Apple, Finance, GNU/Linux, Microsoft, Vista 7, Windows at 9:19 am by Dr. Roy Schestowitz

“We are not on a path to win against Linux”

–Jim Allchin, Microsoft's Platform Group Vice President

Summary: As Microsoft’s earnings fall by a third (again), the reasons are being further analysed and Microsoft investors warned

NOW that it is easier to show ordinary folks that Net Applications is a joke, other writers remark on the inaccuracy of their numbers, which were held up by opponents of GNU/Linux as though these were a gold standard. Paul Rubens writes:

Now, of course, one can discuss Net Applications’ methodology endlessly and question the credibility of any organization that has to revise its figures by as much as 50 percent. But that’s all rather missing the important point. The point is that America’s purchasing patterns aren’t necessarily the same as the rest of the world’s.

Had Net Applications bothered with parts of the world like Russia and Brazil, Apple’s share would drop further and GNU/Linux climb sharply. But Net Applications is probably concerned about paying clients like Microsoft and Apple more than it cares about accurate representation of the truth [1, 2, 3, 4].

“According to Steve Ballmer, GNU/Linux has more market share than Mac OS X (on the desktop).”According to Steve Ballmer, GNU/Linux has more market share than Mac OS X (on the desktop). Microsoft’s internal communication as well is overly obsessed with GNU/Linux, and not so much with Apple. The matter of fact is that Apple only jeopardises Microsoft’s wealthiest of customer bases, whereas the vast majority of the clientèle does not fit into this privileged class.

Microsoft’s fight against GNU/Linux on the desktop is evident based on Comes vs Microsoft exhibits. Microsoft is admittedly scared of GNU/Linux. Our latest post about the Halloween Documents was cited widely and it received some interesting replies. “Barney” writes under the headline “consistent business model of anti-competitive methods”:

they talk like this is competition but it is like many others have said, they’ll say their horse if faster than yours, your horse is slow, and then instead of working on making sure they have the fastest horse, they put 100% of their efforts into shooting your horse.

Have you seen anything where they talk about making a better product and actually competing? No. And that stuff linked about the NetPC( NC or Network Computer ) was revealing in light of the netbook market. Consider how they are “competing” with Linux on netbooks by signing exclusive Windows XP deals such that executives from the OEMs publicly apologize for someone showing Linux on one of their netbooks. I’m sure they want to see the netbook market die off like the NC market and are using many of the same tricks and techniques. There is the smartphone and Android market too. Microsoft paid off every phone manufacturer to plug a version of their OS which was a year off at the exclusion of any Android devices or discussions even though many of these same phone manufacturers planned to ship Android phones in the next few months.

Same old Microsoft and same old Microsoft business methods. A new Microsoft my arse.

“GH” argues that:

MS wants to blend with the oss community to mix code and then like SCO from the deep, make claims against Linux.

Microsoft’s 10K says: “ITEM 1A. RISK FACTORS Our operations and financial results are subject to various risks and uncertainties, including those described below, that could adversely affect our business, financial condition, results of operations, cash flows, and the trading price of our common stock. Challenges to our business model may reduce our revenues and operating margins.”

GNU/Linux is among those risks (not just on servers, as we noted before [1, 2, 3, 4]). More news sites are beginning to write about this, e.g.:

1. Microsoft Acknowledges Linux Threat to Windows Client

Microsoft for the first time has named Linux distributors Red Hat and Canonical as competitors to its Windows client business in its annual filing to the U.S. Securities and Exchange Commission.

The move is an acknowledgement of the first viable competition from Linux to Microsoft’s Windows client business, due mainly to the use of Linux on netbooks, which are rising in prominence as alternatives to full-sized notebooks.

2. Microsoft Blames Open Source for Sales Slump

For many of the regularly caffeinated it was the closing of 600 Starbucks locations; for a large portion of the medical community, the announcement of the sinking crocs ship. As for the tech geeks, it was surely Microsoft’s first-ever drop in annual Windows sales that made them realize: Oh my, the economy really is messed up!

In this case, however, the economy is not the only culprit. Microsoft’s Q4 report to the U.S. SEC includes a rundown of their risk and competition factors, and on that list are both Linux and open source solutions.

3. SpringSource, Canonical, and MySQL join Red Hat on Microsoft’s hit list

Today, life is a little less rosy for Microsoft, as it calls out in its recent 10-K filing with the Securities and Exchange Commission. As TechFlash highlights, Google Android is now called out by Microsoft as a competitor, as are Apple, Opera, and Google in browsers, whereas only Mozilla was deemed worthy of Microsoft’s competitive glare in 2008.

Because of GNU/Linux, Microsoft is competing on price now, rarely charging as much as it is able to get away with given a monopoly. This does not prevent the company from dabbling with price hikes though. From the British news:

Windows 7 upgrade rip-off for UK customers

Microsoft imposes 100% price hike

They give the illusion that Vista 7 is worth something and then bundle it with PCs to make it look like a bargain. At the same time, Microsoft bullies GNU/Linux vendors using racketeering tactics; it is always trying to tax Linux. Here is an old but highly relevant quote:

[Judge Thomas Penfield Jackson] went as far as to compare [Microsoft’s] declaration of innocence to the protestations of gangland killers. He was referring to five gang members in a racketeering, drug-dealing, and murder trial that he had presided over four years earlier. [...] Jackson believed that Gates & Co.’s “crime” was hubris—a refusal to acknowledge that the nation’s antitrust laws applied to them. He was only half joking when he told me, “If I were able to propose a remedy of my devising, I’d require Mr. Gates to write a book report.” The assignment, Jackson said, would be a recent biography of Napoleon, and he went on, “Because I think he has a Napoleonic concept of himself and his company, an arrogance that derives from power and unalloyed success, with no leavening hard experience, no reverses.”

Not much has changed since then:

Notice how Steve [Ballmer] diverts the attention of the public from the real issue here: money.
What Steve here tries to underline – as he has done in oh-so-many-occasions – is the fact that everything has a price. If his company sells, then by comparison, what is free must also have a price. You see, for Steve is crucial that the consumers get brainwashed with this idea. Otherwise they could all just wake up one day and say “hey – what have we been paying for all this time? Why can Linux be free?”
So this is the story of the happy little “intelectual property” fairy.
Steve used to call Linux users “communists”. Linux used to be a “cancer”. Do you know what communists do? They monopolize people.

GNU/Linux is Microsoft’s Nemesis. █

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