Is Microsoft falling down slowly?

Guys,

Could Linux and the other "mayor" enterprises make Microsoft fall slowly? Linux is growing very fast and if others start to improve their products to do things like the report below, i think maybe Microsoft won't be the same in the next years. Besides, Linux fans are really happy that Microsoft is falling... and this is not new.

(Report from newsfactor.com)

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Sony (NYSE: SNE) has announced it will replace Microsoft Office with Sun Microsystems (Nasdaq: SUNW) ' StarOffice suite on most of its desktop PCs sold in Europe.

The Japanese computer maker said the switch will affect PCs sold in the United Kingdom, Germany, Italy, France, Spain and Switzerland. Sun has announced that discussions are under way to place the company's StarOffice 6.0 software on Sony PCs in other countries, too.

"I'm surprised that more PC manufacturers haven't done this," said Steve Kleynhans, an analyst with Meta Group. Kleynhans told NewsFactor that because of the cost factor, Microsoft (Nasdaq: MSFT) alternatives like StarOffice are attractive to PC makers.


An Easy Switch

Like Microsoft's Office package, Sun's StarOffice 6 is a suite of office productivity software, bundling word processing, spreadsheet and other applications typically needed for office work. The user interfaces of the Sun and Microsoft programs are similar, allowing a user familiar with one to switch to the other with relative ease.

Unlike Microsoft Office, StarOffice is an open source software product, and it is considerably less expensive. The new version of StarOffice retails for US$75.95. Microsoft Office sells for $479.

Additionally, the StarOffice program can be used on both Linux and Windows systems. The package uses an XML (extensible markup language) file format, allowing users to share or modify StarOffice content with commonly used software tools.


Eroding Market Share?

While Microsoft has a dominant hold on the desktop PC software market, Sony's decision to switch to StarOffice represents a significant victory for Santa Clara, California-based Sun.

Indeed, the company has worked hard to erode Microsoft's market share. In addition to including StarOffice with its server software, Sun has donated millions of copies to schools.

"Since [the software is] not costing them a lot, Sun hopes to make it up in the long run," Kleynhans said.

Analysts note that Sun has held discussions with ISPs to persuade them to include StarOffice with their basic offerings. Additionally, StarOffice is bundled with the offerings of many OS developers, including SuSE Linux, Ximian and Turbolinux.

Sun representatives were not immediately available for comment.


Big Guns

Sun has some powerful weapons in its efforts to gain more desktop customers. Chief among them is that the company has resolved file compatibility problems between StarOffice and Microsoft Office. In other words, if users want to transfer content between the two programs -- the most common example is Microsoft's .doc files -- the transfer should be problem-free.

An even bigger market factor benefiting Sun is falling PC prices, with some PCs flirting with a sub-$500 price tag. "The home market is extremely price sensitive, and manufacturers are doing anything they can to strip out costs," Kleynhans said. One of the few ways to squeeze extra profits from low prices is with software, he added, noting that StarOffice's low cost gives it a critical advantage.

Kleynhans speculated that Sun offered Sony the software at a price so low that it represents only a nominal profit for Sun. The reasoning behind that alleged strategy is that if Sun can gather a critical mass of home users, adoption in the more lucrative business market will follow.


A Third Player

The other competitor for desktop market share is Corel (Nasdaq: CORL) , which, like Sun, has only a small fraction of the office software market. Earlier this year, Corel scored a major coup by signing a deal to place its WordPerfect suite on PCs made by Gateway, Dell and Hewlett-Packard.

Analysts note that Europe is a particularly fertile market for alternative software products, largely because of European reluctance to embrace Microsoft. Yet, Corel is less well positioned than Sun to enter the European market, because it lacks the necessary alternative language versions of its office program.

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What do you think?

Thanks.

I use StarOffice, although the older free version, and love it. The only Microsoft thing on this computer is the operating system. I'm very tempted, after watching a demonstration of Lycoris linux, to switch. The only thing stopping me is my wife, who has a small fortune in graphics software, all of which needs Windows.

StarOffice is great. It's stable, relatively fast depending on RAM and processor, will convert to Word docs, and takes up less room than Office. I'll never go back. Another nice suite is OpenOffice, which is a Star lookalike and is free from http://www.openoffice.org

Looks like Microsoft is trying to make that not happen.

Quote:

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SEATTLE, Washington (Reuters) -- In a major strategy shift, Microsoft Corp. will introduce software based on the Linux open source operating system in 2004 for Web services and server software, market researcher META Group predicted on Monday.

Microsoft, which denied that it had any plans to develop software for Linux, is facing a growing threat from the open source software standard as it gains share in the corporate server market used to manage networks and data.

META Group predicted that Linux will be used on nearly half of new servers by 2007, up from its current share of 15 to 20 percent, making it difficult for Microsoft to ignore Linux as a platform for its database, Web hosting and e-mail server applications.

"We believe that, beginning in late 2004, Microsoft (and its partners) will begin moving some of its (to-date) proprietary application enablers (e.g., .Net components) to the Linux environment; this will gradually include the major Microsoft back-office products, such as SQL Server, IIS, and Exchange," META Group said.

Group: Microsoft will lower prices
In a further shift, META Group said that Microsoft will also re-price or separate its Windows server operating system "so that it can be favorably compared against 'free' Linux."

"I'm unaware of any efforts at this time to move any products onto Linux," said Peter Houston, senior director at Microsoft's server group, adding that there were no plans to detach or re-price its Windows server operating system.

"We have made a bet on Windows, and we believe that customers are getting value from the bet we made," said Houston, "and we're going to continue doing what we've been doing for customers."

Linux advocates argue that Linux offers better security, flexibility and innovation because its underlying code, or blueprint, for programs remains open to evaluation and scrutiny.

Microsoft, which has grown into the world's largest software maker by selling proprietary software that cannot be copied or modified freely, said it is not opposed to open-source software, and points out that its source code is available to approved partners and educational institutions on a limited basis.

Microsoft faced a similar situation a decade ago when its nascent server software was competing head-to-head with market leader Sun Microsystems Inc. , but Microsoft did not choose at the time to write software for Sun's proprietary version of Unix.

Linux use grows
Now Linux, essentially a free version of Unix, is eating away at Sun's share of the business server market.

Sun, a hardware and software maker, is now selling computers running Linux, a strategy that was also embraced by International Business Machines Corp.

Redmond, Washington-based Microsoft has toned down its criticism of Linux recently, after an internal strategy document said that some of its arguments against open source software has "backfired."

Instead, Microsoft has stressed that its software is more affordable when considering the total cost of using Linux, including ongoing personnel and administration costs.

Microsoft fights back
A recent Microsoft-sponsored study by researcher IDC concluded that servers based on Microsoft's Windows 2000 were cheaper to own and operate when used for networking, storing and sharing files, printing and security, while Linux servers were cheaper to operate when used for Web hosting.

"The IDC study shows that the upfront cost is a small part of the total cost to the customer," said Microsoft's Houston.

META Group's report also came to the same conclusion, saying that Linux's total costs of ownership were likely to be higher for mainstream server applications.

"IT organizations must evaluate platform costs from a total-cost-of-ownership perspective," META Group's report said.



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Copyright 2002 Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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I'm an OpenOffice fan myself, especially after installing it with SuSE 8.1 on my laptop, I don't ever plan on using word unless my college requires me to. And more on the topic of the thread, I could definately see in x years ms not quite falling, but moving from the throne they seem to be on at the moment. I remember starting out learning linux with Red Hat 6.1 or .2 and some old version of kde, now I check out RH 8 or some other up to date release and they are already worlds apart in useability, interface design, and just about everything else. I would almost be frightened to see what the opensource OSs look like in say 10 to 15 years?

"Instead, Microsoft has stressed that its software is more affordable when considering the total cost of using Linux, including ongoing personnel and administration costs."

Well, that sort of explains it all, doesn't it? If Microsoft says it, it must be true. They don't lie. Almost choked on my coffee typing that last sentence.

heh, and just the other day I found a $199 PC at WalMart (yes I know they are evil) that isn't running an Intel chip (or even AMD) AND they didn't have an MS OS installed on it. They are running some strange version of Linux that I have never heard of before, Lycoris Desktop/LX... hehe MS is taking a hit like I said they would soon.




El Diablo

El Diablo, Lycoris is great!! Check out http://www.lycoris.com

I've posted somewhere here before that Lycoris (a Redmond Washington firm) might be the Linux flavor that has a good chance of hurting MS, especially with WalMart offering it via mailorder. Don't know how good those computers are, but Lycoris linux is sure worth taking a look at.

Well, when you can get SuSe Linux 8.1 (personal edition) for forty bucks, or the Pro-version for eighty, and add the Star Office Suite for twenty-five, you have an OS and Office-suite for less than a C-note. Now, let me see, will offerings like that gain market shares? You can bet on it! JMHO, but MS gained it's market share by offering a turn-key product to a brand new market. There were not enough people around who could tweak *nix, and business as well as government had to hit the ground running. Now we have a population that has grown up with the 'puter, and todays kids are tomorrow's CEO's. Simple: 2+2=4 ;)

Microsoft will fall eventually. It's inevitable. The sad thing is that it never should have gotten this far. Microsoft had it all pretty much to itself in the beginning. There were others out there, but MS outwitted them in one way or another.

When they became the dominant software maker, I think it went to their head. The money was rolling in and all the world was their's for the taking and they took advantage of it, and took advantage of their customers with inflated prices and less than perfect software (in some cases. Some of their stuff is really quite good). Now, I think it's all going to come back to roost. Maybe not for a few years, but within the decade.

This is history according to me. Others may disagree.

Microsoft will fall because of Linux but also because only two products make up the majority of there income. Windows and Office. If people were to dump office in a big a way for cheaper alternatives like star office or open office M$ would be in deep ****.

Well from my own work I found M$ very expensive to support it takes this in the real world.
1. One full time person for an office of small business as in under 250 employees to track and document license compliance, to be safe one person per department plus one heavy hitter on Admin to explain to the owners that just because they want to deploy means there is no cost. M$ costs $$$ and owners wants are always bigger then what they want to pay for.

2. No you cannot roll over all those old Win 95 OS and Office to the latest and greatest because of the type of license you started out with.

3. One person to Admin SQL and track it's patches.

4. One person to track the latest patches for IIS.

5. One person to handle my system is frozen up AGAIN problems.

6. One person to Admin Exchange and keep track of it's patches.

7. Oh lets not forget we need a Information Systems Director to over see what everyone else is doing.

Yeah M$ has low Admin cost?$?$ I think M$ is still looking at the Nix software of say 1987 in their cost study.

after experiencing openoffice which came with redhat 8, i dont know why you would even bother to go out and buy m/s office really unless you really desperately needed it for something, where can you get a fully functional o/s with an office suite for nothing?

The only problem with the free Office Suites I've tried, and it's admittedly a minor point, is that none with which I'm familiar has grammar check. In my current occupation it's a big help. Even if sometimes the recommended corrections make no sense, I know something is wrong and can work to correct it. I use on older version of StarOffice, and things would go much faster if even a primitive grammar checker were added.