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The March of Penguins

As the New Year approaches, columnists and analysts invariably dust-off their crystal balls and indulge in the industry’s long tradition of fortune telling. I’m no different, although making predictions becomes easier as a sense of certainty creeps back into IT after a long absence.

Last year, I warned you that Linux would become a hot technology, which is normally a safe bet, as the temperature of the Open Source market has been increasing quarter on quarter since 2000 and server revenues have grown by over 50% year-on-year.

2003 was however, the first year that Microsoft started to feel real pain from the growth of Open Source computing and although in relative terms, Linux shipments remain modest in contrast with Windows, Microsoft is starting to resemble the old Soviet Union in the face of the rise of a penguin-powered ‘Perestroika’.

The coming year will see an acceleration in the migration process from Windows NT and the remaining Netware base of around four million Servers. For very good reasons, Microsoft wishes the market to move rapidly towards a uniform Windows 2003 environment and for equally good reasons; many CIO’s are worried by the cost implications of such a move. After all, the Windows environment isn’t cheap and Microsoft licenses represent a significant proportion of any company’s total cost of ownership (TCO) by the time one has added-in major server applications such as Exchange 2003, the Live Communication Server and the SharePoint Portal Server.

Pursuing the TCO theme, IBM, Novell, Oracle and others will be encouraging their customers along the Open Source road and in the coming year, we should expect Linux to finally make real progress on the corporate desktop, driven by the commercial and competitive interests of Sun and Novell/SuSE.

With nations like Brazil, Thailand and Germany examing the Windows proposition very carefully and even rejecting it, Microsoft will need to quickly revaluate its defensive strategy against Linux and arrive at an argument, which accepts the increasing fact of co-existence and offers a compelling TCO and security answer to its critics. The company may also have to review its licensing agreements and the double standards, which encourages the arrival of ‘special offers’ for customers or continents showing public interest in Linux.

In a recent Comdex interview, Bill Gates, in answering a question on the growth of Linux, is quoted as saying, “Five years ago it would have been Windows versus OS/2. A few years before, it would have been Windows versus Macintosh. Before, maybe it would have been C/PM 86 and before that maybe CP/M 80. There has always been some challenger to the operating system. Linux - which is only a kernel - is not where the interesting stuff is going on nowadays”.

I’m sure Bill is right about the inevitability of competition but I wonder if he’s experincing a form of denial over the march of penguins. There has to be a limit on how much business is prepared to pay for ‘Interesting stuff’ and if IBM and Sun and Oracle can deliver that same ‘Stuff’ to your desktop at a fraction of the cost of a Microsoft alternative then that’s going to be pretty ‘interesting’ to any finance director.

Visit PC World and you’ll see the population at large loves Microsoft software. More accurately perhaps, they love software and they love it even more if it’s cheap, innovative and if it does the job, then they won’t worry so much whose logo is on the front of the box in future.

Some of us can still remember what having a real choice was really like. We had to make strategic decisions based on merit. Lotus 1-2-3, Excel, Supercalc, Word, WordPerfect, or AmiPro. Microsoft has made our lives easy for five years now, by almost eliminating that decision-making process but it’s competition and choice that really counts in business and perhaps with the continued growth of Linux in 2004 we will see its return to this industry.


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