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  • Welcome to Microsoft’s Newest Sales Tactic

    May 17th, 2007

    Over the years, Microsoft has without doubt used every sales trick in the book with which to hawk its products. Back in the 1990s, for example, facing threats from advanced operating systems from NeXT and other companies, Bill Gates touted a formidable new technology called Cairo that would virtually destroy the competition.

    Over the years, Microsoft delivered Windows 95 and its various successors and the server-grade Windows 2000, but Cairo never arrived. Despite its non-delivery, Microsoft has extraordinary clout, so tech pundits invariably accepted the broken promises from Gates and Steve Ballmer as gospel. The hard questions about promising one thing and delivering a second-rate substitute were seldom raised.

    The operating system formerly known as Longhorn was the 21st century equivalent of Microsoft’s grand bait and switch scheme. Over the years, key features were ditched, and the original Longhorn was reincarnated as the slimmed down Windows Vista. Slimmed down, by the way, not in efficiency and speed, but in terms of its capabilities. As an operating system, it requires powerful hardware to deliver decent performance and its full 3D graphics eye-candy.

    To be sure, I suppose the PC box makers must feel good about Vista, because it ought to boost the sale of new computers. Indeed, Vista will be vastly compromised on the $399 PC you buy at a consumer electronics superstore, so you are forced to upgrade. Those cheap boxes mean slim profits for their makers, so if they can convince you to buy something heftier, great. Thank you Microsoft!

    Of course, this is not to say that Vista is necessarily a bad operating system. If it realizes even some of its promise of far greater security, it’ll mean a lot to the home and business users who will inevitably adopt it over the next few years.

    So how well is Vista doing? Well, if you can believe Microsoft, some 40 million copies have been sold, mostly preloaded on new PCs. The number of actual upgrade packages purchased, which generate a much higher return on each unit sold for Microsoft, is far, far less.

    The figure is supposedly a lot more than Windows XP in 2001, but you have to remember that far more computers are sold these days. More to the point, it is widely reported that many of those PCs are still stored in stock rooms and haven’t actually been sold to end users.

    So is Vista a train wreck? A good question, and not something I’m about to claim right now. Vista’s biggest and best chance to gain traction will occur during this year’s holiday season, when Mac OS X Leopard will also be in full bloom.

    For now, however, Vista has made little if any noticeable impact on the sale of new Macs.

    So what is Microsoft going to do next to fuel sales? How about the implied threat of a lawsuit? Well, maybe not, but that was the impression created when the story appeared this week quoting Microsoft as claiming to possess some 235 patents covering various elements of Linux and Open Office technology.

    How are IT managers who are considering a migration to Linux or another open source operating system supposed to react to the possibility that they’re using software that may violate Microsoft patents? Will they shy away from dumping Microsoft in fear they’ll be sued to recover license fees?

    Good question, but Microsoft is now saying that it really isn’t planning to sue anyone, and, apparently, hopes to ultimately make license agreements with open source developers to cover its alleged intellectual property.

    Talk about the great game of poker! You see, Microsoft has, so far at least, not disclosed precisely which patents are involved. All large technology companies have huge portfolios of patents. In fact, with frequent patent lawsuits an ever-present possibility, you can bet that a company will apply for a patent even on the suggestion of a potential innovation. They need those patents — assuming they’re granted of course — in the hope of providing solid defenses against the threat of patent litigation, as a means of exacting license fees or just bluffing the competition.

    Indeed, just what is Microsoft’s end game here? Are they trying to use fear to force people to choose their products instead of the competition, because they can’t sell their products on their merits alone?

    I do hope, for Microsoft’s sake, that this isn’t a new trial balloon, or realistic threat, but just a few executives speaking silly words out of turn. Of course, considering some of the stuff that comes from the lips of Gates and Ballmer, they are simply following their leaders.



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    14 Responses to “Welcome to Microsoft’s Newest Sales Tactic”

    1. Michael says:

      “So how well is Vista doing? Well, if you can believe Microsoft, some 40 million copies have been sold …”

      I think few of us would take any claims made by Microsoft at face value.

      It’s pretty clear that Vista is not selling as well as Microsoft had hoped. At one point Ballmer was saying that predictions had been over-optimistic. But now they seem to have decided that a better tactic is to close the gap between expectations and sales not by blaming the predictions but by claiming they have plenty of sales. Whatever.

      It’s interesting to note that Tim O’Reilly is seeing no fall-off in sales of XP books, whereas his Vista books are not exactly flying out the door:

      “As you can see, Mac OS X Tiger almost completely replaced Panther in the book marketplace after only two months, while after six months, Windows XP books are still selling at a significant clip, almost 50% of the rate of books on Vista.”

      http://radar.oreilly.com/archives/2007/05/a_tale_of_two_o.html

    2. Dana Sutton says:

      For some reason various mail-order houses send me catalogues devoted wholly or in part to PC’s, and I can’t help noticing how many of them still come loaded with XP. Sure, some PC’s were probably still in the pipeline when Vista was released, but by now Vista has been around long enough that this excuse doesn’t seem to work any more. I. m. h. o., this talk about suing for Linux and Open Office is the sort of stuff a corporation only does when it realizes it’s in trouble.

    3. shane blyth says:

      I am currently more worried about office 2007 I am doing a course using word documents and one of the markers has updated to office 2007 and cant open some of our and other users documents that are in the previous version of Word.. what the heck is going on here.. and I am talking about not opening these documents filled in on XP or OSX and nothing else.. So are they trying to force people to shift to Office 2007 because it is not 100% compatible older Word Docs.. Nah they must be just too dumb or are they really clever ?

    4. Michael says:

      I am currently more worried about office 2007 I am doing a course using word documents and one of the markers has updated to office 2007 and cant open some of our and other users documents that are in the previous version of Word.. what the heck is going on here.. and I am talking about not opening these documents filled in on XP or OSX and nothing else.. So are they trying to force people to shift to Office 2007 because it is not 100% compatible older Word Docs.. Nah they must be just too dumb or are they really clever ?

      Microsoft has always gamed people on formats, and one wonders just how long it will take the public to wake up to this one.

      For word-processing I like Mellel best of all, and for long-term storage I’d choose Open Office ODF (if not plaintext or HTML) but *overall* – and notwithstanding the claims of the FOSS people – Microsoft’s office software is the best on the market. I don’t mind conceding them that. But anyone who ties himself into MS formats is being naive. It’s interesting to note that MS’s new convertor for OS X – a free download, BTW and found here:

      http://www.microsoft.com/mac/downloads.aspx?pid=download&location=/mac/download/Office2004/ConverterBeta.xml

      – converts from .docx to .rtf (*not* to .doc). And this is almost certainly because .doc is very much a moving target.

    5. Marie Drovinsky says:

      There is only one certainty when it comes to any information from Microsoft, it is full of LIES!

      Vista is simply a pig and all the FUD Microsoft will generate in their attempts to obfuscate that won’t make people want it. Even the stupidest Windows drones are wary after being burnt 100% of the previous times they are starting to realize it’s not computers that are unreliable and it’s not computer companies that constantly lie about everything, it’s simply Microsoft that makes crap and lies perpetually.

      Vista is the best sales tool Apple ever had. Sales are UP, WAY UP!

      You can be certain the Linux patent threat is to try and narrow short term sales and to try and get access to more patents from open source for Microsoft’s current project. That project is to transition Windows to an open source plus proprietary Microsoft hack based UNIX because they simply can’t build any OS that is competitive on their own. Vista was their last hale Mary pass to see how stupid people are, will they fall for our bull shit and FUD one more time? Of course corporations ARE that stupid after all change is difficult and it’s not their money being flushed down the toilet. Since these dinosaurs make up nearly 90% of Microsoft’s business then Microsoft will keep ‘buying’ these decision makers over and over again. The patent threat is a paper tiger of FUD directed straight at these morons and they will lap it up like every other turd dropped by Microsoft.

    6. Malus Malum says:

      The threats of litigation based on unspecified patents is reminiscent of another company the tech industry loves to hate. It would be sad to see M$ follow SCO’s lead. Just look at how much love SCO has garnered for itself.

    7. J. Scott Anderson says:

      Malus Malum:

      If the reports are correct, Microsoft was actually behind SCO’s attack on Linux. I say “if” because there has been on specific counters out of the big guys like IBM against Microsoft on this issue. Then again, they may think that it just is not worth it. After all, they are all doing well and the threat passed.

    8. John C. Randolph says:

      To be precise, longhorn was a train wreck, and vista was merely a disappointment. Longhorn failed to ship, so Microsoft had to roll back to the Windows Sever 2003 code base, and take about a year and a half to rush out a service pack that they could pretend was a Whole New Thing.

      -jcr

    9. Robert says:

      You can bet that the impression will be left on us by Redmond that Office 2007 is recommended or else they hold no responsibility if it cannot open files from “older versions”. No wonder, the move towards the Open Office documentation format is gathering momentum.

    10. Michael says:

      You can bet that the impression will be left on us by Redmond that Office 2007 is recommended or else they hold no responsibility if it cannot open files from “older versions”. No wonder, the move towards the Open Office documentation format is gathering momentum.

      I’m actually surprised at this. My understanding was that usually the new version of something made by MS would open files written with older versions of the software. The problem–and the stick to make users upgrade–was that, of course, if you had an older version you couldn’t open files made with the new version.

      MacFixit has done a mini-review of the Microsoft’s Office “Open” XML convertor. (How can anyone write Open when referring to a Redmond-owned (and deliberately convoluted) format without using inverted commas?) It’s not a pretty picture.

      Right off the bat there are a number of problems with the installation: first, it uses an installer rather than drag-and-drop (which, as we know, is discouraged on the Mac, and is usually unnecessary); secondly, the installer won’t run if Entourage is running on the machine; thirdly, the installer puts directories and files (literally thousands of them) in odd and inappropriate locations; fourthly, there’s no choice about where to install the main application bundle (too bad if you want it in ~/Applications rather than /Applications).

      In short, the software isn’t up to the standards expected on the Mac platform in the most basic ways.

      To cap matters off, MacFixit could not get the software to work at all:

      http://www.macfixit.com/article.php?story=20070518102508235

    11. Well, I guess I’m not inclined to want to try this converter anytime soon. There are, of course, third party products that offer to handle those conversions — so you’re not stuck if the Microsoft alternative doesn’t function properly.

      Peace,
      Gene

    12. Dana Sutton says:

      This thread is pretty interesting. If most software manufacturers introduced a new format, we’d all shrug, figure out how to deal with it, and move on. But there is so much distrust of Microsoft among computer users that we instinctively put the worst possible spin on it. Doesn’t it even worry Microsoft that they are one of the the most distrusted, feared and hated corporations in America, if not the very worst? If their business consisted of manufacturing death rays fueled by the corpses of freshly clubbed baby seals and selling them to the North Koreans they wouldn’t have a very much more unpopular image. Sooner or later this richly deserved image problem is going to bite them big time, and when it does people will be dancing in the streets.

    13. Michael says:

      This thread is pretty interesting. If most software manufacturers introduced a new format, we’d all shrug, figure out how to deal with it, and move on. But there is so much distrust of Microsoft among computer users that we instinctively put the worst possible spin on it. Doesn’t it even worry Microsoft that they are one of the the most distrusted, feared and hated corporations in America, if not the very worst? If their business consisted of manufacturing death rays fueled by the corpses of freshly clubbed baby seals and selling them to the North Koreans they wouldn’t have a very much more unpopular image. Sooner or later this richly deserved image problem is going to bite them big time, and when it does people will be dancing in the streets.

      And, of course, going by past behaviour, in Microsoft’s case distrust *is* a reasonable response.

      There’s a very funny Slashdot post that John Gruber has linked to before. Anyway, the poster says imagine if you had to write a job specification that would look fair but would guarantee that your friend got the job. So you’d write something that said the applicant should have [a bunch of relevant stuff] plus be 6 foot 1-and-a-half inches tall, capable of reading Ancient Greek, and have one blue eye and one green. And what do you know? That specification is so specific it is only likely to fit your friend. The Slashdotter claims the Microsoft OOXML specification is written like that.

      I haven’t read the spec. and don’t intend to, and anyway I’m not an XML specialist. But I wouldn’t be surprised. I’ve seen excerpts that say things like “handle such-and-such in the way Word for Windows version 3.1 does”. There are even amusing things like making it handle dates in such a way as to make years that aren’t leap years be leap years because some earlier version of Word that has a bug in it did that. Well, yeah … all this is rather suspicious. It’s suspicious in itself that the spec. is something like ten times as long as that for Open Document. One might accept that some polluting of the new standard with unnecessary baggage is necessary for backwards compatibility – so that old documents can be properly converted, but how far will credulity stretch? And can’t that futzing around be done in the convertors rather than being written into the new specification? I guess it’s a grey area, but there’s cause enough for suspicion.

      In any event, one can’t help reflecting that Apple doesn’t need to game the public on formats, because it makes its money on the hardware, and its software plays only a supporting role. Microsoft has tied itself to making most of its money off software – Windows and Office. That has, in the past, meant quick and easy profits – in a sense profits off the back of the OEMs. But it does mean that Microsoft has a commercial need to tie people into its software, since that’s where its money comes from. Put that basic need together with past, well-documented misbehaviour–including a string of interesting revelations that have emerged in court cases–and the suspicion that there may be ulterior motives in the large size and convoluted and self-referential nature of the new Office format specifications seems a reasonable one. It would take more than a few soothing words from the likes of Paul Thurrott to convince me otherwise.

    14. jbelkin says:

      MS also calls SHIPPED the same as SALES so it’s not a very real number – for instance, a vendor might buy their allotment of Vista OEM licenses at the beginning of a quarter guessing how many they might need and MS will call that a “sale.” Technically, it’s true since someone will pay for them even if the company’s plant catches on fire and the CEO is arrested, MS has been paid so they call it a sale … or MS can cheat (really, MS?) by offering, if you take 1 million licenses this quarter, we’ll shave a buck off your OEM license cost of Office or something like that … that’s why most analysts don’t trust shipped but actual sales.

      MS is also doing this with Xbox – claiming 10 million “sold” when it’s really 10 million shipped (NPD is claiming about 5.8 million actually sold out the door).

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