Matevž Gačnik's Weblog

Having an option is always a good thing, right? But there comes a time when we all have to face the truth of the free (economic) world. There are things that just do not fit in common line-of-though agenda.

Like this one (Rob Enderle, link):

Windows is free to the OEMs. In fact, not only is it free, but Microsoft, in effect, pays them to take it. Regardless of the cost, Windows is a logical choice, and a straight pass. Dell (Nasdaq: DELL) pays about $80 for it and typically charges about $80 for it. There is rarely much of a mark up. If Microsoft were to lower its price that lowered price would be reflected in virtually all desktop hardware immediately.

Microsoft provides a number of services which include development support, service support, marketing support, technicians, classes, databases and support materials, and it picks up a lot of the service load as well. In addition, it provides marketing co-op dollars, incentives for early adoption of new products, and ensures a somewhat level playing field (which could be good or bad) for the vendors.

This is the world we all live in. Market share is made by a conglomerate of superiorities. Not necessarily just technical ones. We do need to acknowledge that sometimes market can be gained by offering better business environment for the complete food chain. One needs to respect the box movers too, they need those extra dollars. They need the extra revenue.

Now, here's the question. What if RedHat/Apple/Ubuntu had Microsoft's position? What would happen then?

Short term? Lower prices - better quality of life.

Long term? The same thing.

If Apple had an opportunity to excell at Microsoft's position, I bet they would exercise it! Actually, they are doing it already.

That's why I (mostly) agree with the quoted article.