IDC: Microsoft anti-piracy efforts will backfire
IDC have released their top 10 predictions for “Worldwide System Infrastructure Software” in 2007 yesterday, and it doesn’t look good for Microsoft Windows. The following two predictions are of interest here:
9. Microsoft’s client operating system anti-piracy efforts will backfire. Microsoft’s anti-piracy campaign will drive customers toward Linux.
10. Our expectations remain consistent that Windows Vista in 2007 will not uplift the operating system or PC market spend dramatically, but we are predicting a meaningful shift of adoption favoring premium Windows Vista SKUs.
In a previous post, where I mentioned the high prices for Windows Vista together with the fact that Microsoft is further locking down the OS to prevent piracy, I had already mentioned the possibility of their anti-piracy efforts backfiring on them:
In addition to those high prices, Microsoft have also further locked down Windows Vista and made it more difficult for people to use pirated versions. These two strategies complement eachother. On the one hand you have the high prices, and on the other hand you also force people to have to buy a legal copy. This is, ofcourse, to sell more copies and make even more money.
But this strategy, again if I am correct, is going to massively backfire on Microsoft. There are two options. First, if people are able to reliably crack Windows Vista, even more people will use pirated versions of Vista because the prices are simply too high for them to be able to afford a legal copy. And this means Microsoft is actually going to sell less copies and make less money, although they will be able to keep their marketshare. In the second option, if people aren?t able to reliably crack Windows Vista, those people that were using pirated version of Windows XP are going to have to switch to an alternative OS, like Mac OS X or Linux. In addition, a lot of people using a legal copy of Windows XP might not be able to afford Windows Vista and could also potentially switch to a different OS. So in this second option, not only is Microsoft going to sell less copies of Vista, but they are also going to lose lots of users to other OS?s, and as a result lose marketshare.
With the IDC now essentially saying the same thing, I think Microsoft had better look into this and change their course. In that post I also mentioned the fact that I could not understand why Microsoft is taking such drastic, and quite frankly boneheaded measures, at a time when it seems that more governments and companies around the world are looking at using open source software, and are switching to Linux. If Microsoft is lucky, they might sell less copies of Windows Vista due to even more piracy because of the high prices, but keep much of their market share because of the fact that it seems Windows Vista’s anti-piracy measures can easily be circumvented. If they aren’t, they will lose marketshare to Mac OS X and Linux while also selling less.
Microsoft taking such drastic measures to lock down Windows, and at the same time maintaining the high prices for the OS can only be explained by greed. It’s widely known that their profit margins for Windows and Office are abnormally high already. It’s not like they’re taking a huge hit from all the piracy going on right now.
So again, why are they going down this path when it isn’t really necessary? Is there any other explanation except for greed? Don’t they realize the prices are too high? Just check out this poll on Channel 9:
What do you think of Windows Vista pricing?
Much too high – 36.6%
A bit too high – 45.7%
Quite reasonable – 14.6%
Cheaper than expected – 2.2%
Dirt cheap – 1%
I hope our beloved Steve-O realizes the mistake they are making very soon, otherwise it’s not going to look good for them on the long run. As a developer I am seriously thinking about looking at Linux more and more these days. With Microsoft charging down the path they are on right now, I might have to prepare for the fact that my clients will expect me to develop on Linux in the future because they won’t be able to afford Windows Vista. This is becoming an increasingly more real possibility, and I’m quite sure people who know me will tell you that they would never have dreamed hearing this from me.
This entry was posted
on Thursday, December 14th, 2006 at 6:36 pm by Karel Donk
and is filed under 
December 17th, 2006 at 8:09 pm
I would like if Vista caused more people to switch to Linux. This is exactly with Linux needs!
December 19th, 2006 at 10:56 am
I think Vista would be the last OS that Microsoft would be releasing of that type. Operating systems are quickly becoming a commodity product. The WGA is probably a last minute cash grab for Microsoft to milk as much money from Windows as possible.
However, Windows itself won’t be gone. The APIs and programming systems for it are well too established and Microsoft is the best one that can provide an end to end development environment for it (that is certification, tools, support, etc).
We would probably get more pervasive products instead (e.g. PDAs running Windows Mobile, XBox360s, GPS systems running Windows CE, and Zunes). However, the PC will still be there and still be running Windows, but the OS would probably remain stagnant and not get replaced with anything else anymore.
Microsoft will still be selling software for Windows but focus more on keeping hold of Office on the business PCs. They still don’t have any viable competition to it that supports integration with a lot of their other products or scripting. OpenOffice is good for the casual user, but it isn’t as good when it comes to automating your office workflow.
(Hmm… should move this comment to my blog later
hehe)
January 21st, 2007 at 5:51 pm
That is a great post. You have captured the essence of the problem with anti piracy measures very well. There is of course also the extra issue of a bloated kernel. I feel pretty certain Microsoft fully appreciate the problem they are in in terms of a basic underlying kernel that has way out grown its life. The fact we see them signing up with Novel suse linux to work with them on integration operability is I think a clue to your last question. This is of course wild speculation.
Currently its very clear that forcing 15 year olds to purchase any kind of software is going to be a massive self inflicted wound. At this point in the marketing game they must know they have lost the OS war by ensuring that in four to three years time all those same 15 year olds will be running any free or pirated OS other than Vista. (Lets face it, statistically did anyone buy expensive software before they started work in their first job?)
So I would suggest that MS will be looking to port all their applications to linux very soon (I would also wager that this App porting development work has been going on for a very long time.) The strategy of destroying their own OS could be intentional so that they can cut all ties from their third party suppliers and associated out sourced developers, leaving them clean to push forward with application development. Thus avoiding any possibility of litigation from third party suppliers. Because if they decided to just stop the whole thing and start from scratch with linux or similar then their third party developers would sue them for breach of contract. This partial suicide allows them to get rid of this legacy code base and move smoothly then in the wake of its destruction to App development exclusively on top of a solid Unix type OS.
So what I think we might be seeing is a deliberate strategy by MS to destroy the OS and thus avoid all the messy repercussions it would cause if they just dumped it. My guess is they desperately want to get rid of this kernel and move to unix based kernel which everyone who has used a unix system will know is far superior than the mess that they have built.
It sounds crazy I know. But I can not for the life of me think of any other reason other than the knowledge that this kernel has always been flawed from day one and its just grown into an unmanageable mess. Everything else is smoke and mirrors as the core issue is trying to keep their own in house developers motivated to code on-top of a kernel which they all probably know can not be sustained any longer.
February 3rd, 2007 at 4:34 am
anybody knows more info about the operating system google going to releases, I heard that its free of cost, when that comes to the market what will be the position of Microsoft will they sell their operating system free of cost.