Linux, Market Share and the Desktop

Many people take as a given that the desktop computer market is ossified and completely dominated by Microsoft. But, taking the global view, the PC market is anything but saturated. Some huge, untapped markets will ultimately decide how the market share pie will ultimately be divided. There will be room for Microsoft, Apple, and Linux, but how will it shake out?

Before I begin outlining why I believe Linux is not threatened by Apple’s move to use Intel processors, let me tell you a bit about myself. My entire life I was surrounded by technology. As my father is an electrical engineer, I was probably one of the only kids in my neighborhood who knew what an oscilloscope was, or why anyone would want to have one for personal use. I tinkered with taking apart electrical devices, such as alarm clocks and small TV’s (the shock from the back of a 13″ TV tube is something never to be forgotten). Much of my time as a kid was spent playing with Legos, reading, and becoming a poor baseball player with poor eyesight. Sometime in High School I developed a love for writing, most likely spawned from my love of reading. I spent 1 1/2 years at the University of Illinois where I pursued a major in Secondary Education, concentrating in English. I also performed in 2 student written plays and had a thankfully short tryst with the ROTC (ah, the lure of money for books, tuition and food). Finding myself in a difficult position financially, I left school to work. It was while taking time off from school that I met my wife, who, being the quite intelligent and sharp person that she is, realized that I had a geek-tech side just bursting to come out. When I returned to school (a lovely, small New England liberal arts college) I promptly dove into Computer Science as my major with Computer (or, as many others refer to it, Management) Information Systems as my minor.

While in school, for the second time, I had a professor whose only flaw was that he was certain that Apple would be bankrupt and out of business in two years’ time, that the company was no longer relevant, and we should all concern ourselves with the dominant platform of the moment, Windows 95. This was about a year or so before the world heard of an iCEO or Windows 98. Well, we all know the rest of that history.

Upon graduation I found meaningful, and somewhat gainful, employment with a government contractor developing software for the Navy. I was responsible for taking legacy Unix (specifically HP-UX, or as my co-workers lovingly referred to it, PH-UX) applications and rewriting them in Java. Mostly front-end GUI work, but fun and educational all the same. I also worked on a large scale simulation system, and helped run our company’s test facility. Meanwhile, my wife had attended RISD, graduating with two degrees, a BFA and a BGD (Bachelors of Graphic Design), and had found herself redesigning Tupperware’s website. Together, we had written two children’s books, one of which came with an interactive CD-ROM that I developed in Macromedia Director. Because of my wife’s schooling and work, I found that Apple was far from dead, that their OS was superior to Windows, mostly because it just works, and that Apple’s hardware is built like a tank. Meanwhile, I was finding many faults with Windows, including Windows 2000, and decided to give this thing called Linux a try. My first distro of choice: Corel. Fun and amusing, but my USB Zip drive wouldn’t work, and I didn’t feel like hacking anything. Next, I believe I tried a flavor of Red Hat. Again, too much under the hood just to make the thing usable. So, I gave up for about two years.
Forward to today. My wife and I own a successful fine stationery company. We recently attended the National Stationery Show and our products are in all parts of the country (and, yes, I am proud). She’s still running the same Macintosh we bought so many years ago, and my PC has about two original parts. But, I run Windows 2000 and SUSE 9.1 (soon to be 9.3) on it. And, I look forward to the day that I replace my desktop with a laptop, and we both get Mac Minis for work.

As you can see, I’ve had a fairly diverse background, but have always been surrounded by, or somehow involved with, technology and the tech industry. I do my best to keep abreast of the industry, its problems and its successes. From my particular vantage point I see three operating systems, each competing with each other, but also quite entrenched in their user bases. Two of the three will grow their market share at the expense of the third, and the reasons are fairly simple.

One thing is certain to happen over the next couple of years: Macintosh sales will slow, not drastically, but more so than many think (or, maybe more accurately, the rate of new adopters will cool more significantly than thought). This slow will contine until Apple gets its OSX-on-x86 act together. Of course, anyone who has any idea about the tech industry and a vague clue as to human nature can see the slowdown in Mac sales coming. To spell it out explicitly, Mac sales will slow because Joe and Jane Smith from down the block don’t understand computers at all. Little Bobby, who lives next door and works at CompuMegaSaleMart, only understands what everyone has told him. Macs have no software available for them and that this switch to Intel processors means that the Macs bought today will be obsolete in 18 months. No one wants to hear that the new computer they just bought, even the $399 Blue Light Special Dell, is ever going to be obsolete, even though they will want something new and improved in 6 months, but won’t have the money for 12, therefore creating obsolescence in 12 months anyway. So, when Joe and Jane Smith go into CompuMegaSaleMart to buy their new email/web surfing/recipe writing/occasional school paper word processor computer, they speak with little Bobby. Who nicely shows them the new DellGatewaySonyWhiteBox-Windows-XP-running computer. When Joe and Jane ask about that cute little Mac Mini/iMac that they’ve heard so much about, little Bobby spews the same disinformation to them that he’s received from all those “in the know.” Not really having a clue about computers, and not wanting to buy a computer that has no software available for it and will be useless in 18 months, they opt for the DellGatewaySonyWhiteBox, helping to ensure that, at least for the next couple of years, Symantec and McAfee will stay in business.

Okay, so you ask, “Where does Linux fit into all of this?” Well, it fits in where it fits in. Meaning, it fits in with people like myself, who are looking for a system that they can use without worrying about viruses and trojan horses and spyware; those who like the feel of Linux, the way it hums along and almost never needs to be rebooted (outside the occasional kernel upgrade), the way you can hack the system to your liking, the way your inner geek gets to come out and play. It fits in with students and small business people who can’t afford new equipment every 24 months and the Microsoft Windows license to go with it. More importantly, it fits in where there are large populations of poor people. Namely, countries like China, India, Namibia, Peru, etc. Large populations for whom a license for Windows XP, Office, Norton Anti-virus, etc. would take up most, if not all, of their yearly earnings. It is the developing nations that will lead the adoption of Linux. But, don’t fool yourself, it does not fit in on the desktop of large corporations looking to save some money. Maybe, one day in the future, but not today, regardless of the extra costs associated with the defenses required by running Windows.

Now, take a moment to think about all those poorer nations, and how they can best become ever more competitive in an increasingly technological world. If the Chinese government wanted to obtain a Linux distro, from Red Hat or SUSE, all they would need to do is buy the $54 Upgrade version of SUSE 9.3 (or, for $99 they could get the full version with the printed manual). Then, as long as they never see any money from this, distribute copies to their entire population. Every man, woman and child. Over a billion people. And they would never violate the license. India could do the same. Again, another population that exceeds 1 billion people, who, for the most part, are exceedingly poor. Of course, I am being a bit na�ve here. It would cost enormous amounts of money and man hours to implement such a scheme. Not to mention the acquisition costs for the hardware to run the software. But, remember, the OS doesn’t cost anything, so the initial investment in software is $0. Plus, most Linux distros come with so much packaged software that most any need is met, whether it is writing papers, developing software, or surfing the web (I know, OS X is comparable, however, Linux will run on most any x86 based hardware; OS X is locked into Apple hardware and you can’t legally re-distribute copies of the OS). Now, here’s a system that costs next to nothing, outside of man hours and support staff, to deploy (especially in a virgin market), combine that with relatively modest system requirements, its good-enough-on-the-desktop-for-most-people-to-use status, and I believe we have a winner. Who cares if they prefer Gnome to KDE? They can have both. Finally, the peasants get to eat their cake. How do you say “Microsoft who?” in Chinese?

Now, let’s take a step back for a minute. Let’s try to remember that from our current viewpoint the PC market is fairly fixed. Therefore, we can all talk about market share winners and losers and the fact that Microsoft owns somewhere around 90% of the market, and no one can break the monopoly, etc., etc. However, the market for PC’s is, from worldwide vantage point, not fixed. There are many untapped markets; again, all those poor nations with poor people who are working very hard to no longer be poor nations with poor people. Microsoft is desperately trying to get into those markets with cheap Windows. Add to that their current advantage of Windows being the standard OS on the desktop, and they are well served and armed in their crusade to maintain their dominance in the marketplace. But, remember, we are also dealing with human nature and new markets with little money. So, why pay for cheap legit Windows when there is even cheaper and/or free Windows from the guy standing on the corner? The perception that Apple is too expensive has too long a history and is entrenched too well into the minds of many to make them a viable competitor to cheap and illegal Windows. Enter Linux, the only other serious threat to Microsoft and Windows in these new and poor markets. Linux is a favorite in Brazil and a serious contender in many a municipalities around the world. Cheap to free and favorable licensing. Of course, we should not forget about Apple. They will make inroads with market share gains in many countries where they already have a good foothold, which will slowly spill over into other countries (especially as price parity between Macintosh and Windows based systems is realized in both reality and perception). And, as other factors such as Windows/Office compatibility, freedom from viruses and other malware., and extreme ease of use (most everything just works), plus the added iPod halo effect, take effect, the Macintosh presence will grow into all markets. The Macintosh will be more prevalent in some places, while nearly invisible in others. But, in fact, their worldwide market share will grow and many of the old stigmas will fade into legend. I predict that in the next five (okay, maybe 10) years they will see themselves become, once again, a dominant player in the PC market, with a market share in the 20 – 30% range. Microsoft will continue to see shipments of Windows increase in the ever expanding marketplace, although their market share will decrease to somewhere around 60% by the time Apple has that 20 – 30% share. Which leaves somewhere between 10 – 20% of the OS market open to someone. And that someone would be Linux.

Will Linux be able to actually gain that market share, or will Microsoft and Apple eat Tux for lunch? Of course Linux will grow in market share, it will survive on the desktop in both homes and offices. Even if usability never gets better. People want an alternative to the expensive proprietary systems from both Microsoft and Apple. People want a secure system, one in which they needn’t spend hundreds of dollars a year (especially when they don’t earn much) on extra security measures that eat resources and need constant updating. Poor countries need a solid, stable, secure system that runs well on older hardware and is inexpensive or free to obtain. But, in order for Linux to actually reach that 10% point (remember, the Mac right now is only somewhere around 3 – 5%) usability absolutely needs to be on par and/or better (mostly better) than Windows. Forget about the Mac. Apple is ease of use. The best anyone else can hope for is to be firmly in the shadow of Apple. Now, what do I mean by usability? Well, the ability to fix things, everything, through a GUI environment. The command line is for geeks like myself and old schoolers (although, I do prefer a good GUI). The ability to switch from Gnome to KDE to Fluxbox to AfterStep to WindowMaker (you get my point) and have the identical desktop icon layout. The ability to plug in any hardware and have it just work (well, at least at the level of Windows). Inconsistencies fixed (hmm, no one is immune from that one). Windows compatibility on par with OS X. Many of these issues have been greatly resolved in just a couple of years. Many of these issues are still only perception, the fix already exists, the ease of use is already there. Some of these issues still need work. I leave it to the marketplace to decide what’s what.

But, my point remains, Linux is today a viable alternative to Windows and OS X. Linux is an excellent environment for those with limited funds. The marketplace is not this stagnant, limited growth place, even today, and even with technology as pervasive as it has become. As the world becomes more advanced, as those nations that are behind the wealthy few gain wealth for themselves, the need and hunger for safe and secure computing will grow. The marketplace is still expanding. Apple and Linux are poised and ready for growth. Only Microsoft stands to lose market share in this new, expanding world. Apple’s switch to Intel processors only stands to hurt Microsoft (the reasons for which many people have already touched upon). Cheap and free Linux only hurts Microsoft. It is the simple reasons of a globally unsaturated market, human nature, economic realities and needs, and security concerns that will fuel the growth of Linux. And, unlike with US politics, there is room for three viable platforms. To each their own.

Removed for privacy reasons; 6th August, 2007.