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Free Software's Star to Rise During US Recession?

Cliff posted about 13 years ago | from the every-dark-cloud's-potential-silver-lining dept.

Linux Business 265

robvasquez: "Surfing the web today, I see that RedHat has broke even and that Corel has shown a surprising profit (they are they still considered a linux company, right?), so I'm seeing Linux companies out of the red! Perhaps this 'recession', whether we are starting one or even going in to one, is what we need to popularize free software. Think about it: with companies laying people off and cheapening up, whats better than free software? They could lay off 5,000 people, OR quit shelling out that much in MS licenses and pay salaries!" It's a nice thought, and a good idea for established companies to look into, but quite a few Linux companies have been hit just as hard during the recent economic crunch. I guess only time will tell if the use of Free Software is as much an economic advantage as people have been making it out to be, and now is as good of a time to test this claim as any.

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265 comments

You're not buying into that MS fud are you? (1)

Anonymous Coward | about 13 years ago | (#318036)

If it is more expensive to maintain unix than windows then why do, without exception, every web hosting business charge less for unix hosting than for windows hosting? Is it an "anti-Microsoft" conspiracy, or maybe, despite what MS whould have you believe, its just cheaper to install and maintain unix varients?

Cheaper Software, Pricier Talent (3)

Anonymous Coward | about 13 years ago | (#318038)

Even if the software is "free", the implementation and maintainence of said software is where a lot of the costs come into play. The talent pool for MS software is broader than that of Linux (or other "free" applications), so it would seem to me that hiring an equivalently competant staff of Linux gurus over MS gurus would cost a bit more. The costs of running a successful IT department aren't only those of liscencing, but of keeping the IT staff trained and up to date.

Do you? (2)

Tim (686) | about 13 years ago | (#318040)

"Linux doesn't save any money to a IT shop due to licensing fees becuase windows licesne fees are not that much. However linux can save a lot of money if the machines are set and forget. administrators are the expensive part."

Yeah, admins are expensive, but at thousands of dollars for a 5 user license pack for Win 2000, the difference starts to diminish -- remember, we're not only talking about the big iron in the back room (which, frankly, is likely to be running a *NIX anyway), we're talking about the thousands of desktop boxes that a large corporation needs to administer on a daily basis.

Further, when you consider the anecdotal evidence suggesting that a single, competent UNIX admin can handle more machines with less downtime than a competent Windows admin can handle Windows boxen--even without "set and forget"--the "TCO" starts to look favorable for UNIX.

jwz said it right... (1)

Dom2 (838) | about 13 years ago | (#318041)

"Linux is only free if your time has no value." -- jwz

Boy, was he right. Look at how much time it takes to get things working. It's not as free as it looks.

And don't tell me that MS software is worse. It is. But it's indicative of software as a whole.

-Dom

Do you understand IT? (5)

bluGill (862) | about 13 years ago | (#318044)

Sure, you can save your company $50,000 by using linux of NT, but that is licensing costs. If you have to hire anouther admin because it is more work for your administrators to get their job done, then you haven't saved money.

The cost to hire a compitent administrator are about the same for Linux, NT, other Unix, or anything else. The cost to train someone to do that job is about the same. It doesn't matter if you are using macs, windows, multics, Os/2, linux, solaris, or Os/390, the hard part of administrating the machine isn't learning the job it is knowing how to do it right.

Linux doesn't save any money to a IT shop due to licensing fees becuase windows licesne fees are not that much. However linux can save a lot of money if the machines are set and forget. administrators are the expensive part.

Money is not the most important thing to a bank, it is the ability to get customers their money all the time and accuratly refelect it on their statements. A bank wants to save on comptuer costs only if they are sure the ATMs are working. A phone company cares more about calls getting though then about the cost of comtpuers. I've seen several places with 2 Sun E10ks sitting right next to each other, one a hot standby incase something bad happens to the other. They have a 3rd E10 in a different city they can bring online quickly. They still wouldn't let me re-boot the master e10 despite having backups avaiable just in case. The data was far more important then considerations like computer costs. they told me that 1 minute of lost data is more then the cost of those machines.

Linux isn't a factor because it is free (beer). It might be because it is free (speech). I have seen places with custom linux kernels when they needed it, but that is rare because that same shop had to manually merge in every security patch.

Ok let's get this straight. (1)

LoCoPuff (1019) | about 13 years ago | (#318046)

RedHat did not "Break Even". And free software or not, either people are going to spend money or they won't. That's the end. If they want free 'as in beer' software, they aren't going to pay for the support, or they may as well pay for MS solutions. So no, this will not help redhat and the like.

What are you smoking? (2)

heroine (1220) | about 13 years ago | (#318051)

VA Linux is about as far from paying for software as you can get but they had one of the largest staff reductions of the year on a percentage basis. Software licenses are 1/100th of the cost of one employee. Remember that insurance often costs more than the salary. It may seem academically correct for companies to defer sofware costs to employee salaries but the fact is no-one is going to tranfer assets when they can liquidate the employees and keep even more cash. Computer scientists in industry are more like fuel than valuable contributions. Stay in academia.

No money does help. (1)

Tofu (2355) | about 13 years ago | (#318059)

I tend to agree that a lower budget helps popularity in free software. Where I work [musc.edu] we have
had plenty of budget cuts and other money problems. Because of these money problems people have looked to open source alternatives. We [musc.edu] have come up with many open source solutions to problems for the Univeristy. Without the money problems, and other reasons, people would not have considered using our lab [musc.edu] or the solutions we came up with. Departments and people are now using open source software and now realize that free software is just as good, if not better, than other closed source software. They now are armed with cheap solutions to their problems. They also have more options. If an open source solution does not work they can either adapt the code or use closed software. And before they just had to settle for the closed software that they purchased. Anyway, the point is alot more people were I work [musc.edu] have opened up to open source solutions/software because of money problems and now realize that not only is it cheap, but open source software, most of the time, is really good software.


Re:Software cost is usually not an issue (2)

TBone (5692) | about 13 years ago | (#318066)

Have you used the Gnome suite of stuff? Or StarOffice? Or any of the other office suites that are out there? If you know how to use Office, and can't figure out how to use Abiword, you need to get that lobotomy finished up....

You will need to seriously train only a very small number of people (your current power users) if you were to switch to a new product. Most people will get by knowing how to open and save documents, and how to do basic editing. The rest will be able to survive on a 3-hour group class with handouts that tell you how to "use" the software. Not everyone needs to know how to cascade formulas across 4 worksheets, collect the results on a 5th, import that data to create a graph, then embed that graph in a document for circulation.

Re:There's a couple of problems with this (3)

TBone (5692) | about 13 years ago | (#318067)

1) Large companies don't always do layoffs to "reduce expenses". They do it to reduce the supply because of a forecasted reduced demand

Then what do you call layoffs at a company that supplies nothing other than the manpower to operate the parent company? I call it cutting the bottom line.



2) If we are talking about technical people being laid off, it will still happen: they don't know Linux and so have to be replaced

There will still be computers that still have "I can't log on" or "I can't get my mail" problems, and we will still need helpdesk and cable monkeys to take care of them.



3) MS licenses are not an operating expense, they are a capital expense (capital offense?). Meaning they already have money locked up in licenses

Yeah, buyiong a piece of software is a capital expense. But owning the livcenses to a piece of software over the life of the company becomes an operating expense. If I run a company with 2,000 people in it, and use Office for my App Suite, then I have to stay at either the current or the previous version to maintain support from Microsoft. Older versions are not supported, and I can't afford to support an old piece of software on my own time. Dumping the software only loses money until the point where you would have had to relicense the new version to keep you supported.

Re:Software cost is usually not an issue (5)

TBone (5692) | about 13 years ago | (#318068)

What company are you working for, then? The last two companies I worked for both spent well over a couple of million dollars a year in OS and Application licenses for the desktop. That doesn't include things like Oracle, Notes, or whatever that ran on the servers and weren't directly visible to the user.

If I could save my company 2 million dollars a year, you better bet I'd be getting a raise and a promotion...

Love of the game (1)

eGabriel (5707) | about 13 years ago | (#318069)

It would be nice if Free Software was saving people money, and even helping companies make more of it. Nothing wrong with saving money and making money. Even if using Free Software turned out to
be a viable fuel for outright greed, fine, doing a good thing for a bad reason still gets the good thing done.

The reasons for using Free Software though, have to do with liberty, and even if the big companies don't remember that, even if users don't care about it, it's nice if the smart people who develop the code do remember and do care. Maybe it isn't something as blatant as a quarterly earnings statement, but profit margins can't be instilled in the character of a human being, but a love for freedom can.

Free software falls with the recession. (1)

Woodie (8139) | about 13 years ago | (#318071)

Actually,

Free software will suffer even more in a poor economic cycle. Because it will be harder to make ends meet, programmers will have less spare time. Those with more spare time (i.e. laid off) will likely find themselves looking for non-programming jobs, or are programmers who could have only contributed minimally anyway.

Free software was popular while the times were good. Now comes the real test, now that the days are no longer sunny, we'll see how much progress is made on the Free software front.

- Woodie

Another Factor (1)

bperkins (12056) | about 13 years ago | (#318077)

Now that there are many geeks who had high paying jobs that are now laid off, they may have more time to work on free software projects.

Re:Recession will have exactly the opposite effect (1)

ethereal (13958) | about 13 years ago | (#318079)

What if your developers were working on open source software for company use on company time? I don't get any time at work for my personal projects, but I'm assigned to working with open source all day long when it helps the company bottom line.

Maybe this is what you were getting at, but I got the opposite impression.

Re:Software cost is usually not an issue (1)

ethereal (13958) | about 13 years ago | (#318080)

Except, as discussed in other stories today, you can't really get away with a much cheaper Windows admin without losing the ability to stay on top of security updates (especially the ones that Microsoft tells you you don't need :), service packs, etc. I agree that many companies are hiring cheaper Windows admins, but I disagree that the quality of service provided is the same as it was before switching to Windows.

Ultimately you get what you pay for, and you may have to pay the same amount in different ways with an open source solution. However, you're still better off because then you have a trained staff on-site who understands the technology and will let you decide what direction to move in. Control of the technology that you depend on is hard to measure at the end of the day may be your business' biggest asset.

Re:Red Hat's not bad (1)

Zico (14255) | about 13 years ago | (#318081)

they broke even in the last quarter

No, they lost money last quarter. Just because someone rounds up to zero doesn't mean that the number isn't negative.


Cheers,

If VA Linux's star rises any higher... (1)

Zico (14255) | about 13 years ago | (#318082)

...they'll soon have to hold a "Going Out Of Business" sale. Their stock hit another all-time low today, almost dropping below $2/share. On the bright side, ESR's 41 million dollars just dropped below 300,000 today. :)

Cheers,

Recession will have exactly the opposite effect (1)

Shoeboy (16224) | about 13 years ago | (#318087)

Free Software is a luxury good. The recent explosion in free software is due to the fact that a) free software companies could get enough venture capital to fund developers and b) tech workers have been in such high demand that programmers and sysadmins have been able to work on free software on company time without getting fired.
This will not be the case in the future. Unless they drift into health care or government work, open source developers will find themselves faced with a choice of "contribute to the company's bottom line" or "get fired." Either way, they will be unable to be as productive. The simple fact is that the PC is a luxury good. It is far from being a necessity. The idea of free accessories for a luxury good is laughable.
Free software will not dissappear, but as the developers find it harder and harder to make time to code voluntarily, they'll code less.
--Shoeboy

Re:Ok let's get this straight. (4)

Guanix (16477) | about 13 years ago | (#318088)

Wait. With Microsoft, people pay for product and support. With Red Hat, they only pay for support.

Re:Recession will have exactly the opposite effect (1)

Black Parrot (19622) | about 13 years ago | (#318093)

> PCs are a necessity to modenr businesses, don't forget that.

What do modenr businesses do?

--

Re:Software cost is usually not an issue (2)

Black Parrot (19622) | about 13 years ago | (#318094)

> Except with the smallest of companies, software is rarely a major expense for companies, especially OS's.

On paper, at any rate. In practice, everywhere I've ever worked was really tight-assed about spending pocket change during tough times, presumably because everyone was afraid of getting a chewing from above every time they dropped a dime.

Also, correctly or no, employers tend to think labor is "free" in the sense that since you're already on the payroll they already have to pay you anyway. Most employeers ask their employees to do 4-5 times as much as they can realistically do, so adding on "learn a new trade" or "manage a bank of new machines" for your spare time is not likely to faze any boss I ever worked for.

Your argument has rational force, but PHBs and PHMMs are about as irrational as it comes.

> It may be cheaper for a company to pay a few grand for Windows, then save tens of thousands by hiring a generic Windows admin.

Or a tribe of them?

Reminds me of the joke about the town in the wild west that telegraphed Washington for help during a riot. The citizens were dismayed when a single US Marshal stepped off the train. His response was, "You've only got one riot."

--

Re:There's a couple of problems with this (2)

Black Parrot (19622) | about 13 years ago | (#318095)

> In every company I have ever worked for, the attitude has always been to spend what you need to in order for your people to be productive.

Whoa! I need to consult you about job hunting tips. I've never met a boss who wouldn't waste a month having high-priced engineers dig a ditch by hand because he was too cheapskate to rent a backhoe.

--

It happened with the computers (1)

The Cat (19816) | about 13 years ago | (#318096)

Remember the sudden "discovery" of the market for sub-$1000 computers? Perhaps the move to open source, or maybe more specifically, *less expensive* software is just the same thing that happened for the PC market.

Its nice when the average person (or company) can afford to buy solid, high-quality applications, like those available for Linux (Office suites, development tools, network tools), without spending four figures.

This might continue even if there isn't a recession. People just can't afford this constant "thousands of dollars a year" upgrade cycle. Its too much, and its really unnecessary.

My $0.02 :)

Staroffice in action (2)

pmancini (20121) | about 13 years ago | (#318097)

My Uncle's company is growing and they looked at the licence compliance issue with MS Office. For each 10 people they would need to shell out $4,000. Or they could just give people a copy of StarOffice and by a new Hazmat suit (they do clean up operations). So the office is going over to StarOffice. Not too shabby.

--Peter

Re:Wake me when we get there (2)

powerlord (28156) | about 13 years ago | (#318101)

Any bets on how long it will be until we're back at "Microsoft's inability to deliver" again?

I don't know. What are the latest guesses on when .NET and WindowsXP will be out? :)

Re:Software cost is usually not an issue (1)

gburgyan (28359) | about 13 years ago | (#318102)

I certainly agree -- my wife used to work with the dumbest secretary. One day they replaced her computer and monitor with a newer, faster one with the exact same software. The dufus wanted to get training on how to use the new (the monitor had a different color case) word processor.

God forbid she accidently minimizes the app, then she complains that she doesn't have "the white screen" (AKA the word processor) any more.

People really are that dumb.

Wake me when we get there (2)

DonkPunch (30957) | about 13 years ago | (#318104)

Microsoft's inability to deliver was going to push Linux to the front.

Then the dot com revolution was going to do it.

Then the consumer bandwidth revolution was going to do it.

Then the globalization of computing was going to do it.

Now an economic recession is going to do it.

Any bets on how long it will be until we're back at "Microsoft's inability to deliver" again?

Re:Software cost is usually not an issue (1)

Znork (31774) | about 13 years ago | (#318105)

Heh. Basic internal debit for a pc at the place I work is at $3000 per year. Oh, and thats with nothing but the basics in software.

You wouldnt have to do much more training for switching over to a corporate Linux setup than you have to do anyway when you change Windows and Office releases.

If you hadnt noticed, you pay as much for a good NT admin as you do for a good Unix admin. Of course, there are a lot more cheap drooling retard apes pretending to be NT admins than there pretending to be Linux admins, but trust me, you dont want those people running your NT machines. Unless you enjoy letting everyone take a 7 hour coffee break every other week as your company grinds to a standstill after someone opened their virus of the day mail.

Red Hat out of the Red (1)

csbruce (39509) | about 13 years ago | (#318131)

RedHat has broke even ... so I'm seeing Linux companies out of the red!

So Red Hat should really change their name to Black Hat.

M$ Licensces (1)

razorjack (42178) | about 13 years ago | (#318143)

It's not like most of these companies going out of business ever bought their M$ licensces anyway. The lack of compliance is amazing.

The Wal-Mart precedent? (2)

HMV (44906) | about 13 years ago | (#318144)

Wal-Mart had some of its strongest growth and expansion during the recession of the early 90s. While the economy and the retail sector in general was hit hard, Wal-Mart steamrolled on.

As a company with the price advantage in a completely different industry, we are also finding a lot of new business lately.

Free Software is a Small Piece of a Big Puzzle (3)

superid (46543) | about 13 years ago | (#318146)

A few weeks ago there was an episode of The Lone Gunmen that I really enjoyed. They were searching for the magical car engine that ran on water. The Evil Nemesis (tm) was of course from the oil company. During part of the climactic speech, he said that basically "great, a car that runs on water....but you *still* need oil for lubricating, making plastics, making roads Hahahahahaha!(evil laughter)" and I immediately drew the parallel to the software industry.

I'm basically a web developer now, 3 tier, database, middleware, webserver. Any or all of those tools could be free or $$$ depending on which group of developers in my office you talk to (ie. some want MySQL, some want Sybase....Apache vs IIS, etc) but the costs incurred with those choices are incidental to the hardware, the development time, testing, deployment, help desk support, training, documentation, etc. I'll bet if we were 100% LAMPS, it would save us less than 10% (but I'll still try :))


SuperID
Free Database Hosting [freesql.org]

Re:There's a couple of problems with this (1)

sid crimson (46823) | about 13 years ago | (#318147)

5000 people at $40k each is $200,000 per year

Erm, do you mean $200,000,000 per year?

-sid

Re:Cheaper Software, Pricier Talent (2)

mrjinks (59074) | about 13 years ago | (#318150)

Well, so the old story goes, if they really are decent *n*x talent, one warm body will go a lot further than it would in a Windows shop.

Anecdotal evidence: I work in a software development shop. Mostly Linux, some OpenBSD, some Solaris, two or three Windows laptops, one Macintoy for the interface designer. Pound for pound I spend a lot more time fixing the Windows boxen; next comes Solaris; then the OBSD and Linux machines which require next to no day-to-day fixing. I do all I can to ignore the Mac.

Re:Cost is not an issue (1)

tsetem (59788) | about 13 years ago | (#318151)

1. No really solid HTML editors

Granted, but I prefer VIM anyday.

3. Poor printing services

Try CUPS with GTKlp. I'll take that over windows printing anyday thank you very much. I mean, send duplex print jobs, specify print trays, even 4 pages to 1 sheet of paper. And no, the windows print drivers do not support those options.

4. Its harder to update anything on Linux than Windows and MacOS

Umm, rpm -Uvh or rpm -Fvh . Many an NT Admin has worshipped RPM, rather than sitting down & doing click-next, click-next, click-accept... There is WinInstall, but that's another bastard of a story.

5. Poor graphics support

Well, I do really like the NVIDIA drivers

7. Each Linux variant ships with security holes

Ahem, MSIE 5.x, Ahem

As a workstation OS, I'll take it over any commercial Unix OS anyday.

cost of changing (2)

mach-5 (73873) | about 13 years ago | (#318156)

I'm usually a Linux/Free software advocate, however...

I see some major flaws in the logic here. If my company were to change over to a new platform, we would probably spend millions of dollars changing over the rest of our software, that it would negate the money we would be saving with the free OS. Unfortunately, we are sooooooo MS dependant, especially here in engineering.

I can see change overs happening slowly, starting with the larger, more mission critical, more expensive applications, and eventually working down to the individual user's desktop. But that will take years.

Re:Free Software is a Small Piece of a Big Puzzle (2)

Nexx (75873) | about 13 years ago | (#318159)

But I bet you the lion's share of profits of Mobil and company come not from lubrication, but from the fuels that they provide.

Speaking of Mobil, the McLaren F1 team uses Mobil unleaded. If it's good enough for McLaren, it's good enough for me! (;
--

Re:Recession will have exactly the opposite effect (1)

fprintf (82740) | about 13 years ago | (#318160)

How do you mean "drift into health care"? Do you equate working for insurance companies == government work? Have you worked for either?

If so, you would know enough not to post such drivel. Every developer on my staff contributes to the bottom line. Any developer on my staff has a series of projects to do, and if they get it done w/o any bugs then they are free to do whatever they want on whatever time is left. As the PHB my job is to ensure they have as little time left over to work on open source projects as possible - unless I consider it to be in my/the company's best interest (for instance, let the programmer work on the project if it keeps him happy, and gets another extra few hours of productivity out of him).

Health Care and Government employees suffer from stereotyped images of their working environment. We should all band together and stop this workism - it's just like racism!!

Perhaps. (2)

supabeast! (84658) | about 13 years ago | (#318161)

Free software definately has upsides now that the economy is in the shitter, but I think that in the long run the cost of the hardware is more important, and that is what will push Linux.

One of the reasons that linux has become such a popular webserver platform is because people love to run webservers on Sun hardware. Sun hardware provides a reliable, easy to manage hardware platform, with great support options. Beyond that, it comes with a wonderful OS, that most popular free software has been ported to. The downside of the Sun hardware is the cost. For a webserver that does not need the massive throughput provided by a Sun CPU and bus, Sun hardware is damned expensive. X86 hardware usually costs many tens of thousands of dollars less, but until recently it was hard to get support for x86 platforms running Linux.

Now that major vendors like Dell support Linux on their hardware (And vice-versa.) people will be far more likely to abandon expensive sun hardware in favor of dirt cheap Linux machines. This will probably lead to some nice trickle down business for companies like Penguin computing (And perhaps even the always-overpriced VALinux.) and further help the Linux market, by inspiring competition that leads to lower prices.

Counterargument (1)

graniteMonkey (87619) | about 13 years ago | (#318165)

While some evidence may point to the possibility that Free Software is on the rise, there is some contrary evidence [msn.com] that not all stars are rising, or stand a chance of rising.

Sorry guys, but if it works for RHAT, that doesn't mean it'll work for everyone.

All Your Plunging Stock Options are Belong to VALinux

Training curve (2)

cworley (96911) | about 13 years ago | (#318168)

The training curve is expensive. That's the "proprietary lock-in" at work.

If automobiles were this way, you'd have to completely relearn how to drive on a completely different road system if you wanted to switch from Ford to Chevy.

Re:Recession will have exactly the opposite effect (1)

_Upsilon_ (97438) | about 13 years ago | (#318169)

I think the point was more on the lines of 'acceptance of free software'. Both sides here are true: a recession would slow down the creation of free software, but could increase the user base--even if purely out of need.

anecdotally: (3)

rodentia (102779) | about 13 years ago | (#318173)

I've noticed a surge in interest in the open-source foundations of my projects at work. We'll be presenting on Linux, Apache, Tomcat and Cocoon at an upcoming installment of the CTO's roundtable. There is considerable curiousity about how I'm funding my work in the current budget environment. The answer, of course, is that the stuff is free and runs on hand-me-down hardware.

<herb>It looks here as though your only costs are salary....</herb>

"Free Software" (5)

psin psycle (118560) | about 13 years ago | (#318178)

I think one thing that is slowing the adoption of "free software" is that it is very difficult to get hard numbers on the actual cost of switching from one software package to another.

For a large company the actual cost of purchasing the software may not be the most expensive part of switching. Things like retraining, time spent rolling out the software, technicial support, document convesion can add up to alot of money.

Most IT people do not know very much about writing a business case. Most management types don't know technical speak. As a result the tech who thinks it is obviously cheaper and better to use free software has a hard time convincing management.

One of the good things that Microsoft provides is business cases. If you want to move to a MS product, all the informaiton that you need is made available. (if it actually works as stated is another argument) On their website you can often find migration guides and business cases.

This is an area where free software is greatly lacking. We need to build business cases to prove our case.

I am currently taking a course that trys to bridge the gap between the tech speak and the manager speak. For my term paper for Emerging Technologies I am going to be building a business case for the adoption of OpenOffice in the enterprise. (www.openoffice.org) I will gladly donate the business case to Sun to use to help promote OpenOffice.

I would encourage anyone who has to do a term paper like this to pick a free/open source solution to try to support.

Re:There's a couple of problems with this (1)

Dr_Bones (125791) | about 13 years ago | (#318180)

You point out very well that the large majority of Slashdot, while extremely technically adept, has almost no clue when it comes to business. Well done!

Is it really flamebait if it's true?

Re:Cost is not an issue (2)

small_dick (127697) | about 13 years ago | (#318181)

> 1. No really solid HTML editors
a lot of the best webpages are written by hand anyway, use vi or emacs.

> 2. Poor application linking
my linker and links seem okay.

> 3. Poor printing services
HP just released JetDirect for Linux.

> 4. Its harder to update anything on Linux than Windows and MacOS
debian:
# apt-get update
# apt-get dist-upgrade

> 5. Poor graphics support
OpenGL, OpenInventor, Nvidia, ATI, Matrox...

> 6. No unified GUI (KDE, Gnome, who cares, just make ONE of them work)
My ximian gnome box works fine.

> 7. Each Linux variant ships with security holes
to some extent, all s/w products have security holes. or perhaps you mean the recent bind problems? fixed months ago, and the "apt-get" lines above (provided the security.debian.org entry is in your sources.list) took care of that pretty fast...provided you use bind...long before the Lion was out. Or perhaps you mean a boot disk against a non-passwd protected bios? all mainstream OSen are subject to that.

Go install a stock NT 4.0 box and stick that on the web. I dare ya.


Lately we've started re-using older machines (1)

HerrGlock (141750) | about 13 years ago | (#318187)

Instead of buying new machines with WIN on them, we've started using P200 class machines and putting Linux and *BSD onto them and putting those out to do the work. A lot of time all someone needs is an x-server to do the work and the CPU time is actually on an Ultra 80 or something similar. Do you pay out MS fees, get exceed AND have to get new machines, or do you use what you already have, drop on of the *NIX versions on there and rock with the same or greater stability and a LOT fewer fees upfront. Basically free because you've already written off the machine to be donated etc and the money's long gone for that

Recycle, it's the only way.

DanH
Cav Pilot's Reference Page [cavalrypilot.com]

Re:Cost is not an issue (1)

GeHa (144811) | about 13 years ago | (#318191)

finally someone on Slashdot who's not a Linux zealot, just may be older than 16 and has a clue about what matters to a business versus hobbyists with too much time on their hands.

Curse Me for Being Too Cynical ... (1)

Poligraf (146965) | about 13 years ago | (#318192)

... but the news about company X moving to the Open Source software won't lift its stock the same way as the news about blowing a few thousands of employees.

The reason for that is a totally rotten system of Wall Street with a vultures aka "respected industry analysts" running the show. I remember how HP had an excellent quarter and exceeded the numbers, but the stock had dropped because one of them told that the growth in the UNIX servers was "just a 15%".

Reducing the workforce significantly decreases a company's liability on about everything - pensions, health and other benefits, labor expenses and the amount of computer seats necessary whether computer is just a piece of metal, and software cost is just a small slice of the expense pie.

Re:Cheaper Software, Pricier Talent (1)

big-giant-head (148077) | about 13 years ago | (#318193)

Abosluetly... I have a Linux box at home with Star office, Gimp, Jbuilder etc... I have never had any run-time problems with. On the other hand I spend alot more time messing wih my wife's windows box has this app has overwritten a DLL is Windows/system or Windows/System32 with a version that some other app can't use, so now it won't work. Thats just one example. I've been using MS products for years (like 15 or 16) and they have always been unstable, and over priced....

Free Software (vs MS) Better for Businesses (1)

MaxwellStreet (148915) | about 13 years ago | (#318196)

Free Software will continue to grow in market share at Microsoft's expense, if for no other reason that the risk/reward for ownership continues to grow in Free Software's favor.

Consider this [internetweek.com] , and this [nwfusion.com] . Businesses not only must wade through enormously complex licensing from Microsoft, but they run the very real risk of being audited - with the price of running an unlicensed copy at $150,000 per instance ! Massive effort is required to maintain software licensing compliance, with no real guarantee that the auditors couldn't find something - anything - if they tried hard enough.

It begins to feel like anyone choosing to run Microsoft software does so at grave risk to their businesses, which at any moment may be invaded by the software licensing gestapo, and be fined as much as the SPA figures they can pay.

Microsoft, faced with declining revenues, is going hard against businesses running their software to ensure software license compliance. Even a good faith effort doesn't provide enough protection.

My company has begun using Open Source /Free Software everywhere it can to reduce our software license liability. I expect that as Microsoft muscles in on more and more businesses, we won't be the last.

Re:Free Software (vs MS) Better for Businesses (1)

MaxwellStreet (148915) | about 13 years ago | (#318197)

Whoops! That first Internet Week link should have gone here [internetweek.com] . Got an extra piece of punctuation there.

Re:Red Hat's not bad (1)

Pxtl (151020) | about 13 years ago | (#318199)

Not just that, but M$ doesn't actually make money anyways. Here's an old (1999) article on that [billparish.com] . They're one of the many companies living on their overinflated market value. Does anyone know if this "redhat's breaking even" refers to their market value, or their actual revenue and profit. And yes, I realise how closely tied those are, and how difficult to seperate. While the modern business system seems to focus on overinflating ones own stock, not on actually contributing to the economy as anything other than a horse to bet on.

Don't forget about short-term costs (1)

GenericBoy (159595) | about 13 years ago | (#318201)

Don't forget that switching from MS to Linux, especially at a big shop, will cost mucho denero. Not only will they have to put manhours into it, but they may also have to hire new people to do it.
Chris Armstrong

Linux co? (1)

jargoone (166102) | about 13 years ago | (#318203)

Corel has shown a surprising profit (they are they still considered a linux company, right?)

Calling Corel a "Linux Company" is like calling GE a TV company. Corel turning a profit likely has little to do with the Linux side of their business.

Re:Cheaper Software, Pricier Talent (2)

Meech (166762) | about 13 years ago | (#318207)

talent pool for MS software

that would be like the valedictorian at the school for the mentally retarded.

NOT a luxury good (2)

robhranac (173773) | about 13 years ago | (#318211)

Hate to be a nerdy economist, but this is not the definition of a luxury good. You have described free software as a luxury good because of how it is produced. Luxury goods are defined in terms of their demand: a luxury good is a good that people demand more of when their incomes rise and which they replace with substitutes when their incomes fall. Under this definition, Free Software might be regarded as either a normal good or inferior good. Don't flame me here, inferior goods are just goods who have demand curves that rise as income falls.

If it is an inferior good (possibly an inappropriate name, in a digital economy), then its consumption will rise as incomes fall. This is a pretty interesting thought, because unlike other goods, its price will not rise. There is some speculation that the Irish potato famine was caused because potatoes were an inferior good and as the Irish incomes fell, they substituted potatoes for meat, causing a spike in potato prices, causing lower real incomes, etc., etc. Of course, this will not happen with a free good.

So, I think that the argument that a recession will cause businesses to substitute away from costly software is a reasonable one. The poster here is missing the point, which has to do with consumption, not production. If, of course, a bad economy destroys some of the production mechanisms behind free software, its quality may diminish, but I am skeptical of this idea. Good free software predates our recent goofy boom.

Re:There's a couple of problems with this (2)

Golias (176380) | about 13 years ago | (#318214)

Erm, do you mean $200,000,000 per year?

erm... yes.

Unless I meant $40.00 each, which would be very low labor costs, eh?

Damned daylight saving time... It takes me a solid week to be awake during the day again after the time change. (I don't look forward to next week, when I obviously will be cleaning up mistakes like that from the code that I've been writing today.)

Re:There's a couple of problems with this (3)

Golias (176380) | about 13 years ago | (#318219)

Also

4) 5000 people at $40k each is $200,000 per year (plus you save tens of thousands in seat licenses for your software, because there are fewer people using it.

5) Switching software platforms means you need to either hire new specialists or retrain your techies... either costs money.

Bottom line is that a company will change to open source for one reason and one reason only: if they are convinced that they will make more money using it. In every company I have ever worked for, the attitude has always been to spend what you need to in order for your people to be productive. Whether that means dumping huge cash into an Oracle database, or hiring a Postgres DBA, productivity matters more than expenses.

A CEO (or any manager, for that matter) who does a really good job of cutting expenses (mostly via layoffs) gets a reputation for being a great "hatchet man", and all of his job offers start coming from sick companies that need to make cuts.

A CEO who does a really good job of raising productivity and sales gets a reputation that lands him powerful jobs in healthy companies. Think about it: If you were a corporate executive, which type of CEO would you prefer to strive to be?

I would like to see some propaganda (1)

Teflon Coating (177969) | about 13 years ago | (#318220)

Most system admins are still scared about linux, while others embrace it, and while others are curious to find out about it. Alot of system admins say that there isn't enough software for Linux. StarOffice is very close to M$ word but i think that many users are afraid of their new word processor. I think this new money should be spent to educate system admins about all there fears of linux. You also have to rember that it isn't a turnkey operation to change from Windows to Linux. System admins are also afraid because they don't know about linux and are too lasy to learn.(Not all though!) Alot of people still see linux as some sort of rouge project that can't be used by the masses because they're confused about software being free. (The motto "You get what you pay for" comes to mind)

Re:Training curve (1)

Sir_Real (179104) | about 13 years ago | (#318221)

Yes but by the same token, Instead of driving a semi that got 8 gallons to the mile, you'd be driving a car that got 800 miles to the gallon AND could pull six trailers. It just needs a little paint. :)

Agreed, but... (2)

Alien54 (180860) | about 13 years ago | (#318223)

They could lay off 5,000 people, OR quit shelling out that much in MS licenses and pay salaries!"

I like this alot

unfortunately, if you have a company addicted to MS, making the transition is going to be uncomfortable. In a lot of smaller companies, the Access databases are designed by people with home grown skills. They are not professionals. You have the most amazing kludges running just to keep everything going.

I have a friend who went into a place where they wanted him to fix a database (just patch it up) in 2 days, and the setup would need at LEAST two weeks to inventory. And they were trying to gype him every step of the way. and this IS a 100 million dollar company retailling upscale womens clothing. (names omitted to protect the guilty), They wanted to do the fix inside certain budget parameters that were far too small. But this is the database that runs the financials for the whole company. It is only the lifeblood of the firm. Talk about penny wise and pound foolish.

And yet they sort of manage to stagger by. I wonder how they stay in business at all.

Check out the Vinny the Vampire [eplugz.com] comic strip

MS Licensing Woes Could help (5)

hex1848 (182881) | about 13 years ago | (#318224)

With MS Turning Screws on Customers [slashdot.org] the way they are, I would imagine that many mid size company's would turn to free software, instead of being faced with up to $10,000 per unlicensed product.

Recession::Recursion (2)

jmu1 (183541) | about 13 years ago | (#318226)

I don't care what anybody says. This whole recession thing is a bunch of whooey. Companies feel they aren't making enough money. So, they lay people off. Why? Because that is what happens in a recession. But wait, how does the effect cause the effect? Well, I suppose there is a real life implementatoin/usage for recursion after all! I do think in all seriousness that this recession stuff is a bunch of crap. Why is it that inflation happens? Because companies want to make more money at a faster rate. Why does intrest rates go up? Because the fed says so. Why does the fed say so? Because the businesses are laying off workers. Why would the fed raise interest rates if people are being laid off? Well, that is because they want the economy to go down for a while, so that the next guy in office can look good, while the current victim(official) has to waste time wrestling with the economy.

Re:Recession will have exactly the opposite effect (1)

sulli (195030) | about 13 years ago | (#318231)

Ummm... I don't think so, Shoeboy. I predict that in the recession good developers may find that they have more time to work on free software - either because they got laid off or because there's less paid work to do. Use that time to develop something that becomes well-known, put it on your resume, get a better job when the economy comes back.

(Biting on your troll 'cause it's fun)

Training curve (3)

yoink! (196362) | about 13 years ago | (#318233)

Today's Linux Desktops are getting more and more user friendly all the time. KDE2 and Gnome have the equivalent of a start button, and with many office suites in development there are a plethora of options for all those MS-Word mongers who happen to need Office Premium edition with the free spa day.

Seriously though, there will always be a transition period, we can't really help that, but it's worth it. I'm not just advocating Linux here, but all alternatives, Linux just happens to be a nice example. Sure, we'll see a learning curve, a learning curve softened by the millions of dollars people save with free software. There are so many advantages to using other OSs and apps in workplaces I can't even begin to list them. People are scared of change, I'm scared of change. It took me two years to move to Linux; ie. to feel comfortable that I didn't need anything else. It's to be expected. But just because we're going to need to relearn a few things doesn't mean we can't start right now!


yoink

maybe more for start-ups? (1)

Sodakar (205398) | about 13 years ago | (#318236)

I would think free software is ideal if you're a start-up, since you don't have any legacy software/apps to support -- everything for production can be done using the free software.

Otherwise, trying to make all of your old apps/files/etc work, or to port your old software costs.... bucks... Lay off 200 people, or use those people to port all your software over? Hmm.... not sure about that.

Will that hurt RH ? Hopefully not. (1)

mami (209922) | about 13 years ago | (#318238)

Let's just hope that this here [nytimes.com] will not eat up their future profits. I want RH to succeed.

Free Software is just fluff that will burn away... (1)

splunge2 (211154) | about 13 years ago | (#318239)


Alot of fluff has risen around the industry,
like the small flowers and shrubs that grow
around the base of trees in a forest. Now
that the forest fire has come, alot of that
will go up in smoke... Free Software is going
to be the first to burn out completely...

Re:Cost is not an issue (2)

update() (217397) | about 13 years ago | (#318241)

Exactly. When the submitter wrote:
They could lay off 5,000 people, OR quit shelling out that much in MS licenses and pay salaries!
he's correct, as long as all the workers need to do is read Slashdot, compile hello.c and play with widget themes. Of course, that is all that the noisier Linux zealots do with their boxes, which is why they're so convinced that saving a few dollars on software is necessarily cost effective.

Mexico City is supposedly taking the plunge and going over entirely to Linux. It'll be interesting to see how that works out. That's assuming it actually happens and it's not another bit of "one million Linux PC's in Mexican schools" posturing.

That's for desktops. Servers obviously are a different story.

Unsettling MOTD at my ISP.

RedHat Breaking even (1)

cvanhorn (220298) | about 13 years ago | (#318243)

Look at http://www.redhat.com/about/presscenter/2001/press _Q42001.html - It states that RedHet only lost $0.03 per share. Which is not break even, but is pretty good compared to their earlier losses.

Cost is not an issue (3)

Auckerman (223266) | about 13 years ago | (#318248)

I often hear about the fact that "free" software costs less to buy with hardware as a reason for switching to Open Source. This is too narrow a view to put forth. Cost is not an issue, its what you can do with it. There are three things major reasons you buy a computer for: Games, Server, Workstation.

Games: You want to play all the newest games on a PC (which is a unique market compared to the console market), you have one choice. Windows. Yes I know, MacOS has improved dramtically to the point that it is viable and Linux isn't that far behind, but face it game performance is usually better on a PC and there are more high end graphics orientated games for WIndows than MacOS and Linux combined.

Server: Here is where Open Source has a large following. Apache, Samba, mySQL, Perl, and other such OSS technologies make Bill Gates wake up in the middle of the night sweating, and for good reason too. But, there are some things they don't do as well as something like Win2K does, but in general are more flexable and certainly significantly cheaper than the alternatives.

Workstation: This is the majority market for computers and the biggest expense most businesses (and people) are going to make. Here Linux lacks some key ideas.

1. No really solid HTML editors

2. Poor application linking

3. Poor printing services

4. Its harder to update anything on Linux than Windows and MacOS

5. Poor graphics support

6. No unified GUI (KDE, Gnome, who cares, just make ONE of them work)

7. Each Linux variant ships with security holes

I could go on and on, but you get the point. Not only that, Linux has to deal with misconceptions in the workplace (its ONLY a server, its a hobbiest OS, If its free it can't be any good, It doesnt have any good Office compatible software...yadda yadda)

People want something that they KNOW for a fact will work. Windows may have its cavets (instability, high cost of maintance, et al) but at least it runs Word, it connects to a custom database, and company can call MS (or the OEM) and get help when it dies. In a word, its "simpler" to just choose something convient than it is to built a custom system from components and then deploy it to every desktop in your business.

If you want Linux to suceed, make a distributation that is NOT a server (meaning fix whats written above) that has a significantly better UI and easy to make custom install CDs (and I mean EASY), then you will see LInux being used.

Lay off 5000 vs. Windows Licenses (2)

JohnTheFisherman (225485) | about 13 years ago | (#318251)

"They could lay off 5,000 people, OR quit shelling out that much in MS licenses and pay salaries!"

Wow! Sounds great! Amazing!

Now that we've gotten our little anti-MS tirade/pro-open source plug out of the way, let's look at those numbers, shall we? If we assume everyone in the company is Using Win2K Pro/Office 2000 Pro, that's ~$250+$600. If we estimate an average salary of $40K for the 5000 laid-off employees, that's $200Mil (not including overhead and all), or over 235,000 copies of Windows and Office. So we've saved 2% of the workforce, and had to retrain a quarter of a million employees. Whoop-de-do.

Free software ain't cheap. (1)

glitch13 (227412) | about 13 years ago | (#318253)

Funny how if you pay a bazillion dollars on a bunch of windows licenses you can hire some scrub a 20 grand a year to admin it, yet if you get a *free* OS, that rate magically turns into 80 grand+ per year.

Now I'm not knocking linux, cause I know of its finer points; just giving you a different perspective on what a corporation would look at when deciding this sort of stuff.
------------------------

The worst thing about nerds... (2)

stonewolf (234392) | about 13 years ago | (#318257)

Is that we learn new things very easily. In fact, we deliberately seek out new things to learn. And, we get a thrill out of learning new things. This makes us uniquely and fundamentally different from the other 95% of the human species. The worst thing about us is that most of us are completely unaware of this difference.

For most people learning to use a new OS/Office Suite/Browser is something they did once because they had too. And, rather like a root canal, something that they hope they never have to go through again.

Face it, for the vast majority of people learning Linux is alot like having a root canal and they will not do it until they have the equivalent of a puss filled abscess forcing them to either do it or die.

What will lead to wide spread adoption of Linux is Microsoft excercising their legal right to audit fortune 1000 companies for license violations. Those audits and the forced purchase of licenses cost real money. Just one audit can cost 10s of millions of dollars to conduct and can cost 10s of millions of more dollars in added overhead expenses to make sure they always pass the audits.

What will REALLY hurt Microsoft is when school districts stop using Microsoft software in classes because they cannot afford the cost of an audit or the cost of new licenses to replace ones they own, but cannot produce.

Microsoft license audits are the puss filled abcess that will push the adoption of Linux more than any other single force.

StoneWolf

Re:Software cost is usually not an issue (2)

NineNine (235196) | about 13 years ago | (#318258)

Oh, I agree. Software costs a lot. The thing is, how much did they get for $2 million? Let's be conservative and say it's for a thousand people ($2000/seat). For that thousand people, you'd have to pay for training (very expensive, generally $1000/person/day). And, you'd have to get extra support people (at least, at first), and those support people would be much higer paid than your average MS wonk, because there's less supply of Open Source people. It's the NET difference that executives who do buying look at. That $2 million may have been a drop in the bucket compared to what it would cost to change over their infrastructure and retrain and retool all of their people. Who knows?

Re:Software cost is usually not an issue (2)

NineNine (235196) | about 13 years ago | (#318259)

I wish that that were true. But unfortunately, I worked on a help desk for several years before I became a developer. You put Gnome in front of the average user, and they're lost. I hate to say it, but the average user gets confused with the 'Save' command. I think that training would be expensive. But even if it isn't, there are still lots of other costs that come along with changing infrastructure that you can't take lightly.

Software cost is usually not an issue (3)

NineNine (235196) | about 13 years ago | (#318260)

Except with the smallest of companies, software is rarely a major expense for companies, especially OS's. Usually, a MUCH higher cost is associated with development and support (paying salaries, contractors, etc.). Whether the TCO of Linux is really lower than that of proprietary software is still up in the air, I think. It may be cheaper for a company to pay a few grand for Windows, then save tens of thousands by hiring a generic Windows admin.

Why is RHAT trading at an all time low? (1)

PhipleTroenix (240551) | about 13 years ago | (#318262)

If this is the case, why is RHAT trading at a 52 week low? I bought today, but I'm no wall street genius.

Re:Hmm. (1)

waterbiscuit (241198) | about 13 years ago | (#318263)

I would like to further extend the fluke. Whilst all comments appear to fully justify their opinions with economics and predictions, the industry is simply still too young to be able to say for certain if there is a link between the two. There is nothing to suggest that free software would suffer in a boom, or do particularly well in a depression. I think it seems inappropriate at this young stage to make definitive links between the two.
<P>It is possible to say that as the general economy suffers, there is more need for free software. Equally even in a booming economy, a company will go for whichever option is best suited to its needs, which basic sums will tell us is the cheaper one.
<P>It is therefore simply impossible to create a correlation between the two without making ill-informed judgements.

not a recession (1)

direwolf puppy (243414) | about 13 years ago | (#318264)

repeat after me ... the US is not in a recession right now. Our GNP went up in the final quarter of 2000 (albeit only 1%). Technically, a recession is defined as 2 consecutive quarters of DECLINING GNP.

The problem with the economy right now is that people got used to bringing in 30% returns, and now that we're just barely growing, everyone is in a panic. The press is a major factor in this whole thing. Sheeple believe whatever the press tells them, and panic sells newspapers

Rubbish

Novell versus MS: An IT story (5)

Petrophile (253809) | about 13 years ago | (#318268)

At one time the corporate PC LAN was ruled by Novell NetWare. At it's peak in the early 90s, it had about 80% of the "LAN Server" marketshare. It wasn't the most stable or capable product, but it provided a very managable system for file and print needs, and was often expanded for departmental e-mail service or database needs. Often these Novell systems where installed under the nose of the main/mini-centric IT department in a guerilla manner by departments.

It was also pretty expensive by modern standards, costing something like $1000/seat/year.

Meanwhile Microsoft had been slogging along with about a 10% marketshare for a OS/2-based product called LANManager. Even though LANMan had some nice features like TCP/IP support, Microsoft literally couldn't even give away (and they tried).

Then, the early 90's recession hit, affecting certain corporate headquarters-heavy areas like California and the East Coast especially bad. For those of you who are relatively new to the job market, here's what during a recession: The corporation cuts costs to please Wall Street. An prime example of a "cost" here is the IT department and IT projects.

So, as new generation of IT managers took hold, what they found was a mess: dozens of different mail systems and departmentally managed networks. Different warring tech support groups backing different technology. Hundreds of little Novell servers out in closets managed by relative amateurs.

A few things happend as a result: 1) PC and PC network management was taken from the departments and centralized under the main IT department, 2) IT support was outsourced (it was virtually impossible to get a perm sysadmin job back then) and 3) Aggressive measures were taken to reduce licence costs.

Meanwhile, the Microsoft salesman was standing at the door with their relatively new Windows NT product that carried a very attractive price. If you were large enough, they would negotiate a licence costs that was less than 1/3 of what Novell wanted. No matter that the file and print was less managable and less scalable, you could also use it as an application server to centralize (say) e-mail and/or move it off of those expensive mini's and unix systems.

The result was devestating to Novell's business. Even though Microsoft's prices gradually went up, and Novell's went down, Novell was left with something like a 20% marketshare when it was all over.

So, now we have a situation where Microsoft's prices are going up even higher and IT spending is due again for another round of cutbacks and centralization. Well, those licence costs might have seemed relatively inconsequential when the budget was expanding and you had things like Y2K and webification to worry about. But in a static or declining budget, they will stand out. And CIO's who are paid bonuses to cut costs will notice. If the RedHat salesman comes calling with numbers in hand, they will listen.

Recession will make dotNET (2)

Zeinfeld (263942) | about 13 years ago | (#318273)

They could lay off 5,000 people, OR quit shelling out that much in MS licenses and pay salaries!

The overarching falacy here is that it is a case of either or, if a company believes it has 5,000 surplus employees it will get rid of them in a recession no matter what 'alternative' cost savings it can find. Any 'alternative' cost savings will be considered additional.

Let us see an office license is $400, average cost of a hi tech employee including admin and benefits $80K. So it takes 200 licenses to save one job, so to save 5,000 jobs you would have to be considering purchase of a million software licenses. The figures don't add up, in fact they are barmy

Let alone the fact that retraining, deployment and support costs for any desktop software chage are considerable. Marginal cost of continuing to use existing Office software is zero, cost of moving to 'free' software would be several hundred dollars per seat.

Recession will cause a squeeze on software purchases and it is possible that companies will delay upgrades to OfficeXP. But the big ticket software costs are for enterprise software, ERP systems, the type of product made by Oracle, Entrust, Ariba, Peoplesoft etc. Microsoft's dotNet strategy is to rent this class of software as a service instead of sell it. This is already done by VeriSign in the PKI space.

The advantage of the services model to the provider is obvious, they only have one version of the software to maintain (no need to support versions six years old) and there is only one platform to support. In addition there is a guaranteed stable revenue stream. The service provider has support costs to bear but these are amortized over hundreds or thousands of customers.

The advantages to the customer include much lower startup costs and the majority of the admin costs are covered by the service fees. In addition upgrades will be provided automatically, in many cases without any need for the customer to do anything. Over the lifetime of the contract the supplier will recieve more revenues, but the supplier will also have done much more for the customer whose total cost of ownership will be less as a result.

dotNET has very little to do with the Office product line, renting desktop software is not such a great idea - partticularly in the dotNET model since most people would want to use their copy of Word on an airplane.. What dotNET is really about is breaking into the ERP and Enterprise class software market so that Microsoft can grow the business into new markets and wipe the smug grin off Larry Ellison's face.

It makes a lot of sense both for Microsoft and its partners. There are plenty of opportunities to add value.

Wave Harmonic Economics, I hate Adam Smith, "Run" (1)

dasmegabyte (267018) | about 13 years ago | (#318275)

Well, this is a nice way to think of it for us Java geeks, but I don't think you're inventing anything new. The reason the Fed was invented was to blunt the changes in a natural expansion/recession wave that follows economics. There is a 25 year depression/growth cycle with minor recessions at the crosspoints...meaning that if it weren't for controlling measures like the fed to smooth out the lines we'd surely be bottoming out.

I'm no economic historian...hell, i don't even like Adam Smith...but it's important to realize that this cycle of growth is nothing new, it can be tracked as far back as the middle ages (the beginning of modern trade practices). Nothing can stop the swing, but several factors limit it in recent times...the Fed, FDIC, and all sorts of locking measures in the stock market including the releativly short trading day (things always swing down in the evening and back up a bit in the morning; i guess things are just brighter after a nice breakfast :).

Are these things dependent on each other? Well, yeah, of course they are, it's a free market economy. Without regulation there's going to be undulation according to the 25 year cycle which appears to be a human thing. Can we do anything about it? Yeah, we already are, and if they prove not to be enough we'll do something else (like provoking a big strong nation into a prick waving match in which we focus the country on our "enemies").

Anyway, free software was around long before GNU LINUX -- remember the code samples in the back of Run and Apple World? They saved as much time for us in those days as PHP and Apache do now. It's nothing new or revolutionary. It won't stop the recession -- recessions are caused by panicking humans, not friendly bits -- but it certainly does make computer usage a lot more fun.

Re:MS Licensing Woes Could help (1)

onepoint (301486) | about 13 years ago | (#318277)

The aspect on "cheap or Free" software is very interesting because it might be able to recover it's expenses via the educational books and the tech support/customer serve area.

With on offense to the Linux community, I think that Linux will have to grow into the SELinux. That is the only way I could really see corporate organizations moving from the windows/NT platform. From what I'm told ( I'm not familiar with many Linux application ) there happens to be better word processors, spreadsheets, databases ... I'm just scared to do the move. I have not found any books that will really help me. And because of that fear I have progressed very slowly.

Agreeing with your statement, I think that M$ newer policies about their software, will cause corporate America to review Linux on a deeper level. If the software applications are out there, then corporation will jump at it.

ONEPOINT



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please help me make it better

Re:Recession::Recursion (2)

khyron664 (311649) | about 13 years ago | (#318284)

I kinda think your a bit paranoid about things. First off, we're NOT in a recession. A recession is defined as a number of periods of negative growth (2 if I remember correctly) and we have had 0 periods of negative growth. We are experiencing a slowed period of growth. IE, we're growing slower than we were before. The ironic thing is that companies are treating it like a recession, which makes me wonder what will happen if we go into a recession. The layoffs are hurting consumer confidence, which in turn is hurting the economy. You want to talk about Recursion, how's this:

1. economy slows.
2. companies see thinning profits and lay people off.
3. consumers lose confidence in market and tighten belts because of layoffs.
4. companies see thinning profits/losses and lay more people off.
5. See step 3.

Economic Depression/Recession

It's rather ironic that business' knee-jerk reaction to situations like this hurts their chances of making more money in the long run. Most decisions seem to be for the short term however. Anyway, I don't see a global conspiracy to muck with the economy to someone can look good. The possible exception would be the President, but in no way would he want to make it look bad. Unless he only wants 1 term that is.

Khyron

Good news but... (5)

CyberDawg (318613) | about 13 years ago | (#318289)

It's great to hear that some of the Linux-related companies are not suffering from that dot-com disease that says, "profits don't matter -- only market share and total sales." It's like the Japanese semiconductor companies in the 1980's ("we may lose a nickel on each chip, but we'll make it up in volume"). Unfortunately, as these companies crash and burn, they're hurting other businesses in the market, too. Take servers and routers. If you're looking to expand your business right now, are you going to buy new equipment from VA Linux and Cisco when you can get close-to-new stuff from bankruptcy auctions at dot-coms for pennies on the dollar? Nope. It's going to take a while for the ripples to die out from all of the dead companies run by people who didn't understand the basic tenets of profit and loss.

Re:Recession will have exactly the opposite effect (1)

DetritusX (319569) | about 13 years ago | (#318290)

PCs are a luxury good? WTF have you been smoking? Go ask your bank manager to turn off all his 'luxury goods' for a few minutes. PCs are a necessity to modenr businesses, don't forget that.

Pretty funny stuff (2)

BillyGoatThree (324006) | about 13 years ago | (#318293)

"a) free software companies could get enough venture capital to fund developers"

Never mind the fact that nearly all free software comes from individuals and that "free software companies" are generally just repackagers.

"b) tech workers have been in such high demand that programmers and sysadmins have been able to work on free software on company time without getting fired. "

Conversely, now that so many programmers and sysadmins have been fired from the high-paying jobs that allowed them to sock money away, we should see a huge increase in their output.

"The simple fact is that the PC is a luxury good. It is far from being a necessity."

Only for home use. For business or scientific use it IS a necessity.
--

There's a couple of problems with this (3)

BillyGoatThree (324006) | about 13 years ago | (#318294)

"Think about it: with companies laying people off and cheapening up, whats better than free software? They could lay off 5,000 people, OR quit shelling out that much in MS licenses and pay salaries!"

1) Large companies don't always do layoffs to "reduce expenses". They do it to reduce the supply because of a forecasted reduced demand.

2) If we are talking about technical people being laid off, it will still happen: they don't know Linux and so have to be replaced. Of course, firing an MSCE for being an MSCE might appeal to some...

3) MS licenses are not an operating expense, they are a capital expense (capital offense?). Meaning they already have money locked up in licenses--dumping the software loses that money. I know, I know--it's the fallacy of sunk costs. Nonetheless, some business people work that way.
--

Re:Free Software is just fluff that will burn away (1)

PotLegalizer (398537) | about 13 years ago | (#318295)

Free software burning out completely? I think some of the newer folks may be forgetting the fact that we didn't need dozens of multi-billion dollar companies to develop most of the free software we use today. We didn't need them before, it was nice to have some dedicated folks help out with the initiative while they were able to, but we'll manage without them again if/when we need to. The most likely change is going to be a considerably scaled back contribution from large businesses to free software. (At least in the short term)

Think about it this way... in the 30's when the economy wasn't looking so bright, some folks came up with the New Deal to put people to work building American infrastructure. It was a major investment into things we thought we could make good use of in the future, such as new highways, dams, etc...

Free software development is a major investment in future GLOBAL productivity. I keep thinking back to an article in wired I read about a year ago. What do you think is going to happen when China becomes more modernized and all of a sudden there are a billion or so new people looking for affordable software to build businesses on? (or to more accurately steer their planes into ours) You think they're going to be willing or able to spend a few months of salary each to buy MS software? Free software has and will continue lowering the entry cost of business.

Could be (1)

TopherC (412335) | about 13 years ago | (#318298)

I've seen an overwhelming shift in experimental particle physics from other flavors of Unix into Linux over the last few years. I think the main reasons for this were the no-cost Linux license and way the PC hardware has become almost as powerful as the Sun, Digital, SGI, IBM, and HP workstations yet much cheaper.

This may be a foreshadow of industrial trends to come with the present economic recession because, for the past 8 years or so, particle physics has been in a major recession of its own. After suffering 20% cutbacks in Department of Energy funding over the last few years, we got a 5% cut last year, and rumors of a 15% cut this year are very threatening [fnal.gov] .

Other reasons for basic research programs to switch to Linux include security of having the source code, and the way that the free software movement is consistent with the philosophy of our research. Scientists can get very fearful of any software that's not under their control, so having the source code gives a kind of reassurance that their computing platforms won't break in some way that can't be fixed. And also the basic goal is to increase public knowledge, not to create intellectual property. (I sure am glad I don't need to pay royalties to Einstein's great grandsons every time I boost particle trajectories from one reference frame to another, or compute invariant particle masses.) So it makes sense to use, and develop as the need arises, free software whenever it's feasable.

Okay, I'm getting further off topic, so I'll stop.

Hmm. (3)

glenkim (412499) | about 13 years ago | (#318299)

Pretty cool thought, but it still seems like it might be a fluke. Was the recession taking place during the time span reported in the earnings reports?
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