Red Hat updates premium Linux

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Nice counter post, but...

"Firstly, Linux is replacing Unix in the server room and not desktop Windows."

Windows is also replacing Unix "in the server room". What I'd meant in my post is that Linux is emerging as the alternative on "open architecuture" systems (i.e. PCs).

"Secondly, while MS strong-armed OEMs I don't recall any mention of price manipulation/gouging.
The OEM price is actually a bargain."

Price manipulation is not always gouging. The oppostite is "dumping" and is much more akin to what MS does to manipulate prices. In the case of the browser wars with Netscape, they used their monopoly position with the underlying OS to "choke off Netscape's air supply" by flooding the market with a free browser. Since Linux is already "free", they are less able to do that.

"..Microsoft still controls much of the distribution channel....Wrong. Dell are free to sell as many Linux machines as they want. The problem for you lot is that they choose not to."

What Microsoft does is price Windows based on volume (like "normal", non-monopoly companies do). The more you sell, the cheaper Windows becomes. This means that Dell gets the cheapest price as long as it sells in volume - if volume goes down, the price goes up. Dell and the other PC vendors can't afford to lose margin, nor can they allow their competition to get a price advantage. They can only sell non-Windows systems into "incremental" markets that do not affect their current volume. This is why Dell and HP can offer Linux servers, since there is no Windows monopoly in servers (yet).

"..will continue to leverage its huge assets (mostly derived from its years of monopoly pricing)...You must have been on holidays but MS announced last year that they'll be returning most of the Billions as dividends.
If you read the financials you also realized that MS don't have to dip into any reserves as they are still a very profitable company.
Still, don't let the truth get in the way of a good story."

As you point out, they don't have to dip into their cash reserves since they are a "very profitable company". If you dig into their annual report, you'll see the vast majority of their profits come from Windows and Office - the two products where they enjoy a monopoly position. Many of their other products that must compete (X Box, MSN, SQL-Server, Great Plains, etc.) are actually losing money.

"It's about apps and ease of use and not flowery excuses."

"Flowery excuses" is an illiterate way of saying "reasons that I am too ignorant to understand".

Posted by: psuedostratified   Posted on: 02/15/05 You are currently: a Guest | Members login | Terms of Use

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