Using formal economic modelling, professors Pankaj Ghemawat and Ramon Casadesus-Masanell consider the competitive dynamics of the software wars between Microsoft and open source.
Microsoft vs. Open Source: Who Will Win?
About The Author
Eugenia Loli
Ex-programmer, ex-editor in chief at OSNews.com, now a visual artist/filmmaker.
Follow me on Twitter @EugeniaLoli
The article was a fairly straight-forward read until the end when the team was asked to make projections about how Microsoft could battle Gnu/linux and Free software. Some of it was really interesting. For instance, one suggestion they give is for Microsoft to promote forking of OSS projects, which will minimize linux’s advantage of “demand-side learning”.
I found this excerpt interesting as well:
# Decrease Linux’s demand-side learning.
1. Because the way to do this involves some questionable (from a legal point of view) actions, we will refrain from suggesting specifics.
I believe they are suggesting that Microsoft attack code repositories such as sourceforge, or personal sites that host free code. Also, one way they could achieve this is by contributing to free software projects code which is difficult to read, or in some other way obfuscates the source code.
heh… dude.. are you kidding… the us gov’t and the europeon union would come down on ms so swift they wouldn’t know what hit em…. ms is being closely watched.. they need to dot all their i’s and cross their t’s
Proprietory binary only software has become unacceptable nowadays. Open source is pretty much standard now and that’s what people excpect. Longhorn has already turned out a failure and more and more people are installing Linux on their desktops and notebooks. Linux has already pretty much become the standard.
I’m not saying Microsoft is going to do this. Read the article, they refrain from detailing how Microsoft could combat demand-side learning for legal reasons.
I suspect contaminating code is one such method.
And I really don’t think Microsoft is going to put “contributed my microsoft” in all their dirty work. It would likely be more difficult to trace, individuals who may or may not exist, anonymous sources from local hotspot IP addresses.
Realistically, Microsoft is not likely to do this, but the article raises “questionable” practices as methods for Microsoft to combat OSS.
Money might not buy happiness, but it can buy a lot of power and friends in high places.
“We conjecture that there are multiple equilibria and that the use of FUD to mold perceptions about future value becomes crucial.”
Mmm… I think they are over-estimating FUD… Although propaganda is still powerfull, in my thinking (which perhaps is maybe naive or wishfull), the internet is pretty much killing the effectiveness of mass propaganda (or will, in the future), because it empowers the masses (I hate this word, btw) with their own means of communication, so that the possibility of being manipulated decreases, as they can counter that propaganda by themselves, and form ways (communities, groups,etc) to defend their interests .
The bitkeeper example, the SCO example, the MS FUD example, show how hard it is to basically fool FSS/OSS communities, aswell outside people (as the FS/OSS also has the means to influence them, via internet)
In another note, I’d like to discuss “innovation”
This “innovation” concept is just an element of propaganda Microsoft has been hitting. And it is just ridiculous (*almost* as ridiculous as the TCO propaganda) . Besides the fact that OSS/FS does innovate, and there are lot’s of examples to show that, the most important thing to note is that innovation is useless, if it is controlled by one group, as the possibility of receiving the benefits of such innovation are reduced significantly (they come with strings attached, typical of market and economic pressures, at best, or due to just plain greediness, at worst). In fact, it is *freedom* that truly matters. As it is only with freedom, that innovation can truly benefit all.
” “Promote” Linux’s code forking. ”
This is what a well known distribution which came out of nowhere and became so popular in no time did to its Mother distro.
There was no apparent good reason to fork.
A reader here said that he was smelling a big rat. And I tended to agree because everything is just to odd.
I don’t think that’s really going to happen until GNU comes preloaded on retail computers. Most people don’t really think of “Windows” as an operating system. They probably don’t even pay attention to the fact that the software is called “windows”.
However, the transition to 64-bit has opened the market up to a few different CPU architechures. This is one area where closed-source binaries will be at a disadvantage. Also, with the exception of Flash, it seems like the web developer community prefers open standards. Apple does support such standards better than Microsoft, but GNU/Linux really cements themselves to unencoumbered technology. For this reason, Gnu/linux will always be relevant.
OSS can not win, simply because programmers need to make a living and they can not do that if OSS is the norm.
Most of these hobby programmers have actual programming jobs elsewhere that work on commercial software.
Besides, who wants to volunter all of their time on free stufff and not get paid for it if they are not insane? they would have to live in a box and work on a library computer! getting fed at the local free soup kitchen and food bank.
considering there are other huge software players, such as the #2 Oracle this article is really dumb.
people seem to think the only alternative to microsoft is open source…
I.. however.. think “Shared source”, the source that is open yet completely commercial (But the user can modify it if they wish to do so but not sell or distribute it) is the way to go.
there has not been any company that has made solid profit on OSS that does not impose restrictive user agreements (redhat) and dual licensing practices (sun, mysql)
Worthless article. This is like the “CISC vs. RISC” debates of 15 years ago. each side will borrow features from the other untill they’re indistinguishable.
This is what a well known distribution which came out of nowhere and became so popular in no time did to its Mother distro.
There was no apparent good reason to fork.
A reader here said that he was smelling a big rat. And I tended to agree because everything is just to odd.
Are you talking about Ubuntu!? I feel for the Debian community, but how long should users have to wait for changes? This has been an exciting time for Gnu/linux with the Xorg, Project Utopia, Xgl, Cairo, HAL, D-Bus, Beagle, etc projects, and Debian is still using linux 2.4.*. Meanwhile, Ubuntu has created one of the best, modern linux platforms available.
I know we’re all part of the same community, but that doesn’t mean there isn’t competition. And Ubuntu hasn’t made any attempts to undermine software Freedom that i’m aware of, so I don’t see where the problem is.
If you weren’t talking about Ubuntu, i appologize for making an ass of myself.
I disagree, 64-bit x86 is harsh competition to sparc, power, mips, etc.
and due to court rulings companies can use the x86 instruction set and the AMD64 technology can easily be licensed if not already available due to the so-called intel monopoly. It’s just an instruction set..
I don’t see why sun and ibm develope advanced x64 compatible cpus instead of sticking to their failling sparc and power cpus.
The only thing ibm has been successful in is the embedded market (video games?)
We’ll talk about ‘standard’ once the major computer manufacturers are starting to ship Linux boxes or when more than 1 people out of 10 use Linux at home in a desktop environment.
Open source will prevail, but saying it’s already the standard is just selling the bear’s hide before killing it.
“Are you talking about Ubuntu!?”
Suppose for a moment, just suppose, that I was.
Why couldn’t they do all they did without forking?
I am using Kanotix and it is just as bleeding edge, except that you can get Gnome 2.10 only from experimental.
However Kanotix is 100% Debian compatible. So it can be done: you can have a nice, bleeding edge distro without forking: bingo! What the article says all of a sudden seems to make a lot of sense.
Again they miss certain problems such as faulty programming. A few bugs and cripple your image and begin to push users else where. Such examples are the LSSA exploits, IE holes and various other forms of spyware exploitation. On the otherside of things the Linux camp is gearing up for this brave new world, http://www.linuxdevices.com/news/NS7277846850.html.
who wins? the customer wins. They can choose either to buy
expensive propietary software or get it for free and buy installation/maintenance, etc.
couldnt care less about oss’ merits as a business model, and less so about microsoft’s
> Linux has already pretty much become the standard.
LOL that’s true, Linux is used by almost 100% of Linux users nowadays, so virtually no one uses MS Windose. Why bother?
>who wins? the customer wins. They can choose either to buy
>expensive propietary software or get it for free and buy
>installation/maintenance, etc.
>couldnt care less about oss’ merits as a business model, and
>less so about microsoft’s
Yes, exactly. Competition is great. You see it already. Mozilla Firefox is beating up Internet Explorer, so Microsoft is promising tabs, more security, and some rendering improvements. You also see Microsoft lowering prices in some situations.
On the topic of prices and this article, has anyone noticed that Microsoft doesn’t seem to care who buy the teacher/student edition of Microsoft Office? As far as I can tell, there is no status confirmation process?
Proprietory binary only software has become unacceptable nowadays. Open source is pretty much standard now and that’s what people excpect.
What planet are you living on? Here on Earth, not only to regular people not even KNOW what open source software is, but most “IT Professionals” are strictly MS only.
At last, a reasoned analysis! Eugenia, can we please have some more quality control on this site and only have analysis articles that are of this calibre in the future, instead of the usual propaganda pieces?
OSS can not win, simply because programmers need to make a living and they can not do that if OSS is the norm.
Most of these hobby programmers have actual programming jobs elsewhere that work on commercial software.
Most programmers doesn’t work at Microsoft, the typical programmer work for companies that doesn’t sell software but real things that people actually need like housing, transportation, food production etc. They work on in house projects that will be much cheeper if they are don with FOSS than with closed source tools and libraries. This means there will be more money for the programmer.
So programmers will still make a living, they just wont make that living from working at software houses like Microsoft. As you can see, the fact that a program is FOSS doesn’t mean that it doesn’t have commersial value.
Okay, all the pro-Open Source guys out there, I have a question for you. If open-source development can catch and fix bugs better and faster than commercial development, then how do you explain this?
http://www.tomshardware.com/hardnews/20050606_192818.html
Can you explain why, after 15 years+ of Windows, a file is still considered “executable” because of its file extension?
Between 160 and 200 billion dollars in damages due to malware in 2004…guess what: 99% was due to flaws in Windows security.
That said, their comments about how Microsoft could improve its position basically reiterate stuff MS has ALREADY DONE.
And it isn’t working as far as I can tell.
The ONLY thing holding Linux back from the desktop and the overall enterprise IT arena is the lack of large, robust, FREE enterprise-level applications. The tools are there, but there aren’t enough community developments going on in things like enterprise applications integration (EAI), ERP, data mining, business intelligence yada, yada – the stuff you see being hawked in the IT trade journals for $100K-1 million and up.
And the only thing preventing that from happening is that a lot of programmers still believe in “job security” (especially after the dot-bomb) and don’t realize they can make a nice living writing OSS in their spare time, then when it’s done, customizing and installing and training and supporting.
Everybody in programming should have their own “OSS plan” – decide on a project in your vertical industry area of expertise, get together with others in your vertical industry, and build it. Then form a vertical market consultantcy and use your OSS product to get work.
Proprietory binary only software has become unacceptable
nowadays. Open source is pretty much standard now and that’s what people excpect.
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Ummm… I’m gonna have to say no on this one. Good, fully featured software is what people accept. I’m not trying to bash open source software (I have a few handy open source utilities I use all the time) but right now there is NO opensource alternative to my Photoshop, Maya 3D, or Dreamweaver. Sure, you gotta pay good money for the software, but the ease of use and time it can save you ends up making up cost in the long run.
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Longhorn has already turned out a failure and more and more people are installing Linux on their desktops and notebooks.
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Longhorn isnt even out. Sure, it may not look overly impressive now, but you never know what might happen in a year when its released. Juste because people install Linux doesnt mean it becomes their main OS. I know a few people who have installed Linux and it either gets deleted when they need more space or it just sits there and never gets booted into.
OSS can not win, simply because programmers need to make a living and they can not do that if OSS is the norm.
Most of these hobby programmers have actual programming jobs elsewhere that work on commercial software.
All right. But if all software will open and free when will this programmers work ?
Your wrong, but here’s why I think you ar wrong:
People are employed to make software for inhouse applications, but a lot of them also make them for companies like microsoft, sun, oracle, apple, etc.
When the employee base at the corporate software houses are cut in half that puts lots of people out of work that have to look for work elsewhere. That cuts the volunteer base greatly. It’s already hard enough to get open source projects off the group with a good community of contributors, think about how much more difficult it will be.
ALSO IF YOU THINK ABOUT IT CLOSELY:
also, a lot of the inhouse applications are made because the lack of the ability to modify expensive commercial applications. IF there are open source alternatives to this that are available for free the programmer’s workforce that make applications for inhouse uses will be more than cut in half because it will be reduced to people that just modify apps..
People will train to support the software and install it–not how to code it. The volunteer base will shrink greatly without jobs in the software industry because not many people do work for free.
WHY I RELEASE OSS APPS:
I release open source software myself only because I feel that it a) its dead and will not sell, so why not give and spread my name and b) dual license it or bsd/mit/ccdl,etc. license it so that i can get FREE work and that gives me the ability to sell it.
SO…. OSS can only exist is Commercial software exists….. Things like FreeBSD would die(or not be updated that much) if it were not for the commercial involvement in the project.
Think..About..It… or… think.. different…
Tell me, how you make money on this unless if you do it in great volume?
The only reason a company would do this would be to make money (redhat?) on someone else’s work (open source software)
or because they failed at making their own software sellable so they ride a “movement” of loyal “fanboys” that will use their brand and get their company advertised (novell?)..
Sorry, but I have no reason to buy maitenance or installation for open source software (like linux or freebsd) because it’s extremely easy for me and a lot of people to do this themselves and not waste money on what the open source community gives away….
which might i had is the main reason why I use OSS but I know that it is impossible for open soruce software to only exist and that Commercial and OSS must co-exisist for the quality of themsleves.
When you think about it.. those big contributors to OSS projects are infact employed by a commercial software company or a company that has restrictive useragreements.
does not take a genius to relize this I think.. let me know if I’m an idiot and give me lengthy explanations on BOTH sides
OSS has becoming relatively fast a massive knowledge tank that can benefit all.
”
The only reason a company would do this would be to make money (redhat?) on someone else’s work (open source software)
”
who is maintaing gtk, glibc, writing tons of kernel code, started freedesktop.org, wrote hal, dbus? gcj?
Your wrong, but here’s why I think you ar wrong:
People are employed to make software for inhouse applications, but a lot of them also make them for companies like microsoft, sun, oracle, apple, etc.
I suppose the figures may vary from country to country.
Where I live, software houses accounts for less than 10%
of all programmer employments.
From the article:
Consider SCO, a small Swiss-based “vulture” firm that had bought up…
But well…I guess If your so high on your mathematical models, these things can slip by 😉
I don’t see why sun and ibm develope advanced x64 compatible cpus instead of sticking to their failling sparc and power cpus.
Because it’s difficult to see how they could build better x64 CPUs than Intel and AMD.
So it’s either stick with what they got or buy from Intel and AMD. At least Sun might go with the second approach soon.
Mike wrote: I believe they are suggesting that Microsoft attack code repositories such as sourceforge, or personal sites that host free code. Also, one way they could achieve this is by contributing to free software projects code which is difficult to read, or in some other way obfuscates the source code.
The authors called it demand-side learning: That is users learning how to use Linux, how to report bugs, and how to contribute code.
There’s no need for Microsoft to take the illegal road – the Linux ‘community’ is doing that already:
* Every proposed standard is discussed for years, and waits for implementations for several more years.
* Old webpages with outdated tutorials aren’t removed, and the vast amount of irrelevent mailing list archives covers useful information in google.
* Lots of programming languages and libraries for basically the same thing make code sharing harder then necessary, and results in nearly the same applications with the mere difference of being coded in [insert_language], not talking about the number of incompatible licenses.
However, that’s what Open Source is all about, isn’t it?
is that the OS will be irrelevant. Sun allready have realized this as they opensorce Solaris. What counts will be the software that runs on it. This is what makes the windows platform so strong.
Today, free software becomes more and more cross platform, we have windows versions of qt, gtk++, wxwidgets,… some toolkits even expand their crossplatformness to the Mac. According to the authers this will increase the value of the windows platform. That may be true, but it will increase the value of the application even more.
The idea that Microsoft could lower the price of windows to make a living on windows only software will not work. There will be free crossplatform alternatives that lower the price even in that sector.
Microsoft also faces the problem of having old customers as their worst competitors, nowdays it is very hard to get sombody to upgrade to the next version of MS-Office as there is no business case for doing so. This makes it hard for them to change their software and file formats in a Linux/FOSS unfriendly direction. To make it worse FOSS software will typically run on both old and new windows versions creating even less incentive to upgrade the OS
itself.
More and more can be done through the web. In that area Microsoft have no edge anymore. IE6 is far behind its free competitors. It will fall even more behind as new versions of mozila and others probably will hit the market before IE7 is released. Even if Microsoft manages to release a good IE7, they tell us that it will not run on win2k. This platform still make up about 30% of Microsofts customers.
On the server side Apache holds about 70% of the market.
Can you explain why, after 15 years+ of Windows, a file is still considered “executable” because of its file extension?
This is a meaningless question, that has nothing to do with the discussion. However, Microsoft is big on supporting all it’s customers (incl. DOS users), hence I suspect it’s for backward compatibility.
Between 160 and 200 billion dollars in damages due to malware in 2004…guess what: 99% was due to flaws in Windows security.
Ahem. This is do to users not properly configuring their machines. Microsoft is guilty of not providing a proper configuration out of the box. Once properly configured, Windows is the safest OS around.
thgis is the anonymous comment about customers winning. I was commenting about the benefits available to the consumer, being a company or whatever. Maybe a company would be inbterested in
runing the company and in generasting profits rather than spending time conmpiling a kernel or typing ./ configure . As a CEO, I would want to log in to my computer at my office
and run the place, and pay a team of programmers to run ./ and config or make. In this country, for example, most unemployed recent studebnts who just finished college go to work for change at companies maintaining a company’s systems. There are very few program inhouses, only two.
Until people stop expecting Linux to be a “free Windows” it will have a hard time with gaining the majority of the Market share. Most of us here know the Linux a better OS on countless points but that dosent change the fact that most humans are not as adventurous as we are in the geek community.
I propose addicition counseling for M$ products.
🙂
-nX
If your choice is Linux for schools or Microsoft Windows for schools (but with a license cost of US$ 1.50, agreed with Microsoft), and you are an ONG in one of the poorest provinces of Ecuador, what would you choose?
I’ve read the article yesterday and today I see it already happening.