We all know from experience … with Google Apps you can often have to add a lot of different third party appliances just to get to parity with the experience and then all of a sudden you've got lots of vendors to manage and all of a sudden it's very different to that low cost price point that Google initially positioned to the customer.
This is an old story; shades of every high-end vedor that's ever been wiped out by a low-cost player. As a hardware guy, it reminds me of the response you'd hear from POWER, PA-RISC, Alpha, SPARC, etc. vendors when you mentioned x86 workstations.
At the time, my response was, sure, maybe you've got a better product now, but what fundamental advantage do you have that keeps Intel from using their large, and growing, userbase and economies of scale to crush your R&D spending and pull ahead?
Software doesn't have such high fixed costs, and MS has a ton of money to spend on R&D. But, this still sounds like a lame defense.
Vendor management comes with a real cost (typically in terms of time).
This might be more contentious, but I believe that people that are still using Windows Server (and Microsoft offerings other than AD) are doing so because it's easier to use/more familiar than Linux/open-source alternatives: Throw Joe-Linux on Acme-Cloud-Provider and use Weekly-Flavor-Config-Management? Sounds hard. Click some buttons and fudge your way through group policy? Now we're talking something I can do to pay off a mortgage.
Microsoft's tooling is easier to use and they've got a massive training/certification programme.
Because it's so easy, there are a factor more Microsoft admins around than there are Linux admins. And they're fairly productive.
Plus, Microsoft software works really well together. Windows + Windows Server + SQL Server. Works great.
Linux is great if you have highly skilled technicians to support it. There's way more tweaking involved than with Windows; this makes it ideal for anyone running a centralised model where they're deploying thousands of identical machines (like the web). It's not so great for corporate environments where there's a high level of variance..
It's basically the Ford vs Ferrari argument: Microsoft enables companies to employ average quality labour to produce a "good enough" result. Ferrari employ top engineers to produce an extremely high quality result.
I was actually an IT intern at a billing service and we had several new servers come in. I was there early (by about 4 hours) before the other 3 IT people came in and simply set up a Linux server to try and show them that it worked great (instead of paying Microsoft for the server software).
Turns out after showing them they liked it and they are currently running the Linux servers. Windows machines are used throughout the company for the regular users, but Linux for their servers storing all the patient information files, user data, etc. After spending about 3 months as an intern I essentially taught the Microsoft certified staff enough to manage the servers well enough (it's really not all that hard) and they still have them running (roughly a year later).
Point is, you really don't need highly skilled technicians, none of them had used Linux before my internship, yet all of them still seem to run the servers fine. One REALLY nice thing is that their Linux servers go down far less, are quicker, and are actually more secure than their old Windows 2000 servers they were running.
For the past few months, I have been using Windows at work (MS shop) after a long hiatus from Redmond's OS. I used to be a full-time Linux user and then moved to OS X.
Recently, I had to set up a development environment for ASP.Net development and was taken aback by the sheer amount of things I needed to install and knobs I had to turn to get it working. I've never had so much trouble on Linux nor OS X.
The same is true for getting a working build environment for our main product (CPython-based). I find Windows to be quite hostile to non-VS environments.
It's time to retire ye olde Linux-is-complex argument. It really does not hold up to scrutiny. I say this as someone that uses Windows 5/7 days and OS X 7/7 days, so I'm at least a little bit informed about the OSes.
Compared to MySQL, sure. But that's like comparing a spade to digger: both can make a hole in the ground, but you'll want the digger to do some real work.
It doesn't compare as well to Postgres - but the better tooling may well make it worth the $10k in licence fees. That's a month of engineer time in maintenance.
SQL Server's cheap for what you get when compared to the commercial competition. Informix is pretty much dead (and had horrible tooling). Oracle is even more expensive. And compared to Oracle, Microsoft look like angels. Ingres is a bit of a joke.
The big expensive MSSQL licences also include some pretty nifty BI tools, including decent implementations of data mining algorithms.
The licensing cost for SQL Server have increased over the years and limiting some of security features to the top tier sucks ass in this environment, but the training, documentation, knowledge sharing and community is better than any other technical community, closed or open sourced that I have found.
I would think that Linux financially scales better than Windows, which is why Windows Server + SQL is shrinking while Linux server is growing, and now Linux is the world's most popular system for servers, especially for highest-traffic sites.
That and the fact that Windows server ties in nicely with the Windows workstations that the company uses.
I use Server 2008 R2 (and upwards) at work and its really not bad, it's miles ahead of the previous versions which were horrible to use. Is it not possible that people use this stuff because its useful?
If you have a Windows server and you're writing .NET code the only option (of you want the latest .NET version) is to use Windows workstations. That's like saying OSX runs great on Macbooks. It is designed to do that.
I'm saying Windows Server ties in nicely with the desktop versions of Windows (managing permissions and accounts, AD, email, network resources etc). Its like saying OSX server works great with Macbooks.
And my point was perhaps the reason people are using Windows server is not because Linux is too hard and unfamiliar but because just maybe it's a better fit.
What's especially damning is that there are no specifics. It amounts to an unsupported assertion to the sales people that they are not selling the inferior product. I have yet to see any of the "lot of different third party appliances."
This is the death of complete Microsoft dominance, not the company. Cloud email represents a relatively small portion (25-30%) of the total enterprise market, and Microsoft owns the on-premise market.
Google is maturing as an enterprise vendor, and the simplicity of the licensing model and lack of client side software is appealing to the "new economy" companies: small businesses, businesses using Macs/BYOD and businesses using lots of freelancers/temps.
For the traditional enterprise shops, Google can be a real pain. You need to buy 3rd party stuff for things like identity federation, for example.
At the end of the day, it's called competition, and it's great. Instead of Ballmer & Co. coming down off the mountain and letting us know what we're going to do for the next 5 years, we have a real marketplace and can say no.
The question now is, can Microsoft compete in a world where they are no longer a monopoly?
They make almost all of their still-quite-impressive profit from the markets that they still completely dominate, like enterprise productivity software. They are probably losing money on products like Windows Phone and Surface.
So what happens when Microsoft has credible competition in every market it sells to? That will soon be the case (if for no other reason than the fact that Google is actively trying to kill them), and I'm not sure even Microsoft is confident that Microsoft can compete and stay profitable in that environment. I see a lot of belt-tightening in their future.
I don't really think a company can get--or stay--as big as Microsoft is, without the rent-seeking ability afforded by near-total monopoly of a major market.
Of course. People will be buying Office licenses for a long time; there's too many companies with mission critical stuff that relies on Access or Excel macros. They'll continue to sell Server licenses for the many companies that have systems built atop SQL Server. When you're an entrenched solution as opposed to a potential rip-and-replace, you definitely have a competitive advantage.
Good question. History (IBM) suggests that they can probably muddle through.
You can ask the same question of Google. Enterprise with Google is a grown up hobby project that isn't a big earnings generator. Will google apps stay cheap if googles golden goose (advertising) declines?
Will google apps stay cheap if googles golden goose (advertising) declines?
Nothing lasts forever. No matter how much we want to think that major corporations are permanent institutions, they have a lifecycle, and when they lose control of their market they may continue along for quite a while in a zombie-like state, but eventually they will wither away and die. Someone outside of Google will eventually figure out a better way to do online advertising, and Google will find itself in the position that Microsoft is in today.
Microsoft is trying really hard to get a new lease on life through a product pivot, but I'm just not sure it's even possible at this point. Their products are generally more expensive and not convincingly better than the competition's.
Product companies require a higher level of talent than consulting companies do.
The larger companies get, it just gets harder to maintain that level of quality, and the consequences show up in the output. A Google at 50K employees looks very similar to a MS or an IBM when they were at that staffing level.
Look at Intel they have been stuck at 100k for decades.
The only exception I can think of is Samsung but this is really over a much smaller time frame so doubt it will sustain.
Is this "revelation" really that interesting? Everyone knows that Microsoft can't fight anyone based on price. Every salesperson in the same situation knows that the only way to fight low price is by selling based on perceived value. "Oracle is expensive, but if you compare its value, it's much cheaper." BMW can't compete vs a Hyundai based on price, they need to compete based on perceived value. For me Hyundai is more than adequate, because I only look at my car as a way to transport myself, not as a status symbol or an extension of my being. For those that do, good for them, and they will find value in a BMW.
Same goes for MSFT vs Linux or GOOG, etc. There's nothing new here.
Office suite is still the Adobe Photoshop of business software. Office is still deeply entrenched in businesses and holding on because it still offers the most features.
For example, Excel vs. Google docs: you can do basic charts and graphs in Google docs, but clearly Excel has many more features, such as data analysis tools, and when you connect Excel to Microsoft SQL server you have reporting + data mart, where Google Apps offers nothing similar (not without a lot development work needed to set it up)
Google Apps is good but often you still find businesses also need Office suite. If Google were to say, directly connect Google docs to a data warehouse tool such as Dremel, the add a lot of advanced data analysis features to Google docs, then things would start to get interesting.
Don't forget the millions, perhaps billions of dollars spent by organisations developing complex Excel/VBA based software. Short of copying to Docs every single Excel feature and quirk, there's no way Google can compete in that area. It will probably take a decade after everyone stops developing new software in Excel/VBA before organisations can think of moving away from it. Most large companies haven't stopped yet.
Sure the vast number of users use only a tiny fraction of the functionality, but many of them also [sometimes] need to open important files that someone has spent hours painstakingly making impossible to open in anything other than Excel.
If I wasn't being emailed Office documents on a daily basis I'd assume my colleagues and clients didn't like me any more!
Google's goal isn't to replace Office. They just have to force Microsoft to reduce their margins, to refocus on Office as a product - if Google is lucky, Microsoft will pull a Win8/Surface (ie, total freak out) and abandon their main market to squash the "cloud" competition. If they're not, then customers win, at not that much cost to Google.
Either way, Microsoft will see their unit margins drop. This is good business strategy for Google given their rivalry.
The entire US Department of the Interior (~71k employees) switched to gmail this year. It seems to have gone pretty well. The most common complaint I've heard is that gmail doesn't support the custom smiley faces that Lotus did.
The inbox size vastly increased (500MB => 30GB) which makes the record keeping much easier, just never delete anything. Before we had to empty our mail into offline archives.
Everyone still uses office for word processing and spreadsheets. The online storage is nice for sharing files though.
Exactly. There's a tendency to throw around bullets points of advantage (It's open! It's not big-bad Microsoft, but a company you can TRUST! etc) as if the things are enabled by flipping a switch or the ethics involved are far more important than bottom lines.
Why? A medium business running in Romania has much more to worry from Romanian government/tax authorities than US security agency overreach.
And even if they do - where to go? A lot of non it companies don't have even real ops ... hosting your own email and servers is expensive in that case. And potentially dangerous a modest string of bad luck could wipe you.
You don't need to use Gmail as a business. There are a ton of alternatives, from all places.
And precisely because a company like Microsoft or Google would do this, you need to fear them, because they would do this with other governments, too, including the Romanian one. It's not just NSA you have to fear. If the laws allow it, the Romanian government could get all your secret documents from Skydrive or Gmail, just as easily.
SELinux is open source. At least you can verify and prove they it has a backdoor in it. Good luck doing that with Windows, Skype or Skydrive.
Did you read about the Cryptocat security bug? We learned about it because it was open source. Maybe NSA found out about it even earlier, but at least we did, too, and fixed it. Now imagine the same type of bug was in Skype. Then NSA would be the only ones who know about it.
It's two different business models: Simplicity versus Total Solution. Starting from scratch simplicity usually seems better, but as companies grow they (for good financial reasons) wind up doing a lot of 1 off solutions in the name of flexibility and being customer-centric.
I agree. I wonder if they appreciate how frustrating it is to deal with their licensing. Even more than price, small IT departments want to just get out from under that wet blanket. Why Software Assurance? It's all to Microsoft's benefit. If a company wants to upgrade then let them pay the discounted price and upgrade on their own schedule. Don't turn it into an annuity for the vendor.
Apple is the most valued (market cap) platform company because it owns the affluence market and commands high margins across the board. Google has gone after the "next billion" users, people who don't have that kind of money. MS might be trapped in the middle, neither sexy enough to be Apple nor cheap enough to be Google.
Your comments only really apply to the consumer market.
Microsoft's position in enterprise is extremely strong. Apple is not making any serious attempt to challenge that (and probably never will), but Google (and Linux) pose a real threat to Microsoft in the long run.