14 DAY TRIAL // Once the traditional anti-open source poster child, Microsoft is slowly seeing this aura eroding replaced as a direct consequence of the rise of new, more pressing, rivals such as Google and Apple. Furthermore, the Redmond company, once the epitome of the proprietary software business model, while still retaining its overall strategy, is more and more embracing open source with its own solutions mainly through its new found commitment to interoperability. Microsoft's relaxed approach to what used to be regarded as a fierce potential competitor was on display at the company's Financial Analyst Meeting 2008 the past week. The Redmond giant stopped nothing short of declaring an all out victory over Linux and open source.
"In the industry-standard computing space, a number of years ago we faced the challenge of what was going to happen with Linux and the growth of open source. And fundamentally we made a decision that business customers make rational business decisions, and the reason they choose an open source product is because they can solve the problem better than they can with a Windows-based product. So when you put it in those sorts of terms, the way we compete against Linux is very simple: we build a better product and we have a great value proposition. Today our customers know Linux isn't free and the overall cost of the solution is in fact in most cases quite a bit higher than a Windows-based solution. And if we can offer a better solution at a great price, then customers choose Windows -- and they are. So we are growing strongly," stated Bob Muglia, Senior Vice President, Server and Tools Business.
But Muglia wasn't the only Microsoft top executive to indicate that Windows and the Redmond company's products now have the upper-hand compared to Linux and open source. A similar perspective was offered by Kevin Turner, Microsoft Chief Operating Officer. Turner revealed that Microsoft considers the face-off with open source over the last couple of years nothing short of a success. The statement was based on the fact that the software giant managed to grow its shipments at a rate three times faster compared to Linux and open source.
Turner also added that Microsoft is by no means declaring peace. "And we're really getting the message out about the fraudulent perception of free in the marketplace as it relates to open source. IT pros and decision-makers are starting to get it, that it's not free, that there's a lot of TCO that goes along with that, and there's also substantial security risks that go along with it. And so we're really making some traction in this area, and we're going to continue to hit the gas and go more and more aggressive as it relates to winning share," he stated.
Microsoft Chief Executive Officer Ballmer tackled the same issue during his presentation. The company's CEO talked about the threat of open source technology and business model in the past tense. Ballmer pointed to five years back to open source as a potential threat. Additionally, the Microsoft CEO pointed out that Microsoft's focus is shifting away from keeping open source down and toward Software + Services and the online search and advertising markets.
"Today we live in a world where I think people worry about the risks in software plus services, and advertising. And what do I tell our people, the only way to really win this game is to go out there and do it every day. Nobody talks as much today about the risks in our business that come from Linux and open source. They're still there, they're going to be there every day, and yet we've done a very, very good job, I think, in the marketplace versus those risks," Ballmer stated.