$200 Laptops Break a Business Model
nytimes.com
nytimes.com
In fact, I'd say that this is a bit of a microsoft biased story in that the emphasis is "Microsoft can't compete on price" (which they can frame as "we don't want to compete on price") when in fact MS is losing at both the top end and the bottom end of the market.
You're absolutely right that Microsoft is going to get squeezed from both directions by Linux and Mac.
The most likely near-term consequence is that Microsoft may be pushed out of the home market if they don't introduce a relatively cheap home OS.
The article makes a point that there could be disruptive change on its way that leaves the world with much less relative, general purpose computing power in homes and small businesses. I don't think that is disproved by Apple's success.
In the college market that I'm in I see a lot of netbooks being used as the only computer... so food for thought. A lot of people genuinely do not see the value in paying $1K+ for a computer, and are willing to live with the poorer performance.
I only really boot the xp machine so the rest of the household can reach a printer, when necessary.
[Traditional technology being mostly the standard Microsoft stack, replaced by various online applications.]
At some point, CEOs of more conservative corporations are going to be presented with these numbers in a board meeting, and will have a very hard time defending the value they're getting for the money they're handing over to Microsoft. True, there's the "we would have to retrain our employees" argument, but young employees are already used to doing everything online and will be asking the same questions.
Add to that the downward pressure on margins from netbooks (no one is going to spend $200 for an OS on a $200 computer), and I do not see any upside for Microsoft in the near future.
That is manifestly not the case; complex work is complex regardless of the delivery method. I have worked on and with a couple of web applications where it took several days to train someone to use the application; mostly because of the sheer number of variables they controlled.
What I think you are trying to say is that there is no need to train people in the UI basics.
They would if they had to. Lots of people spend $200 on games for a $200 game console, don't they? I just spent $380 on a computer to run on a $20 power supply, because without the computer, the power supply is pretty useless.
The difference is that Linux is now good enough that they don't have to spend $200 on an OS.
You can easily pay $20,000 for software to run on a $200 computer. Whether that represents value for money or not depends on what you're trying to do.
This is not quite as true for businesses, but even there the cost of site licenses for the Microsoft product stack needs to be questioned for employees whose needs are web browsing, email, and basic document editing. And, of course, the article shows that newer companies are coming to that conclusion already.
2. $40 is a big cost to absorb when you are selling a $200 or $300 netbook.
http://www.iht.com/articles/2009/01/26/technology/26spend.ph...
Software only becomes expensive when it is based upon this intangible notion of "sales," a per-unit figure that becomes largely irrelevant when factoring in dollars spent on marketing and advertising, licensing fees and things of that sort.
OSS has the unique ability to put both categories in somewhat of a corner. Not really intentionally, either; simply by being honest.
asus makes luxury into commodity
the price of netbooks should drop (esp over last 2 yrs) but didn't, suggesting there's a lot of demands