Linux- Gaining Ground

            

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Themes: Innovation
Period : 1990-2003
Organization : IBM - Linux Technology Center, Microsoft
Pub Date : 2003
Countries : ---
Industry : Software

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Case Code : BSTR042
Case Length : 17 Pages
Price: Rs. 400;

Linux- Gaining Ground | Case Study



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Threatened by the Penguin Contd...

• Linux performs better than Windows NT,
• Linux is more reliable than Windows NT,
• Linux is more secure than Windows NT,
• Linux can replace Windows as a desktop operating system, and,
• Linux is free.

Microsoft referred to lab tests, which indicated that Windows NT was faster and more secure than Linux, and also claimed that working on Linux o/s was actually costlier than working on Windows NT. However, the Linux community said that Microsoft was making comparisons with the older version of Linux. They said that while Microsoft had taken 1999 June 'PC Week' benchmarks, which showed Windows NT performing better than Linux, it had not mentioned the fact that the same problems had been fixed by programmers, and a new version of Linux - Linux 2.2 had been released since then. However, the Linux community agreed that Linux had to be improved to make it more reliable for critical mission servers.

The portal created by Microsoft could not contain the growing popularity of Linux. By 2000, Linux's market share increased to 27%, and according to an IDC report, Linux's growth rate was 24% against Microsoft's 20% (Refer Table I). In May 2001, Microsoft's Chief Software Strategist, Craig Mundie (Mundie) (in a speech at New York University) attacked Linux, stating that it defied the system of intellectual property rights (IPR).

He also said that using Linux license might change a company's IPRs into public property, as it wanted all the changes made to the source code to be made freely available to the public. However, Linux supporters were quick to refute Mundie's charge by stating that a company using Linux would not be forced to give away any application written for its operating system or its business processes.

In an interview to the Chicago Sun Times in June 2001, Steve Ballmer, CEO, Microsoft called Linux 'a cancer' - as it defied IPRs. In order to restrict the spread of Linux to government offices, Microsoft lobbied heavily with governments to increase the usage of Microsoft software. However, in the early 2001, many governments including the US government were openly considering legislation encouraging the use of Linux.

Ted Schadler, Analyst, Forrester Research Inc, said, "The strategy [of bad-mouthing Linux] has failed, and Microsoft should abandon it immediately."18 In 2002, Microsoft appointed Peter Houston, senior director, server strategy, to conduct a study on Linux and devise a strategy to counter Linux. Houston said that though Linux was free, its maintenance costs were very high as compared to Windows.

In December 2002, Microsoft appointed market researcher IDC to evaluate the total cost of ownership (TCO) for Windows 2000 and Linux. The study was conducted on both Windows and Linux in five different computing tasks like sending files to printers and running security applications. IDC reported that Windows was 11-22% cheaper over a period of 5 years to operate than Linux. However, the study also mentioned that Windows was very expensive for hosting web pages.

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18] Pecked By Penguins, Business Week, March 3, 2003.