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Microsoft's Unix, Dell's Linux, and a Virus Warning: Get Infected, Get Fired

By Rob Enderle
Mar 19, 2007 4:00 AM PT

I'm spending some time thinking about missed and anticipated opportunities this week. In looking at Windows Server, I've become convinced that it is the wrong product for the Unix displacement market. In fact, in my head, it really always has been -- I just don't talk about servers much, so it doesn't come up.

Microsoft's Unix, Dell's Linux, and a Virus Warning: Get Infected, Get Fired

On the desktop side, Dell is considering Linux, and there is a lot of speculation that Microsoft is pressuring Dell not to do it or that "Get the Facts" is making Linux look unattractive to Dell. Neither is true; Linux is simply the wrong product for the desktop right now, and that has more to do with the Free Software Foundation than it does Microsoft. In fact, Microsoft is a good deal of the reason Dell IS considering Linux.

Finally, I ran into something that I'm kind of surprised hasn't happened before. Kids intentionally infected a middle school computer with a virus and -- though she apparently was blameless -- a substitute teacher was fired as a result. This could happen to you.

Microsoft Unix Server

Unix servers were developed to take the place of the mainframe. As a result, they were focused on scalability, security and ease of use from the start, but that last target wasn't particularly difficult to reach, given how hard the mainframe was to work on. Unix never was even competitive on the desktop until the Apple folks rethought it, and now it is actually very competitive -- but only when it comes from Apple.

On the other hand, Windows -- or DOS actually -- was initially designed to compete with typewriters and calculators. Ease of use was paramount, and neither security nor scalability was particularly important. Performance counted, but against typewriters and calculators, that bar wasn't particularly high, either.

Linux was designed to replace Unix, and with the exception of a unique license, it is nearly plug compatible with Unix. It reflects the thinking of a large group of programmers -- mostly Unix -- who wanted to create something better. Many of the resulting improvements have to do with the social structure of the organizations and people who surround Linux, and how intellectual property is protected -- or not protected. Linux was built to address the shortcomings many felt existed in Unix, and only in the last six or so years has it been positioned as anti-Windows.

Mixed Shops

The only reason I think Windows Server even can compete with Linux in the Unix displacement market is that right now, it does a better job in mixed shops than Linux does. In a Unix shop, I doubt it would even be seriously considered. Were Linux funded to the level Windows is, Linux would probably do better -- even in mixed shops.

The Linux vs. Windows Unix displacement competition is a fight between something purposely built to win that fight and something that has been modified. As resources increase for Linux, you would expect -- unless Unix resurges (and look at Sun, it kind of is) -- that it will eventually own what was the Unix market. Granted, a lot of folks are increasingly having problems with the GPL (General Public License), but we'll leave that for another time.

What if Microsoft bought SCO, shut down all of the litigation, and brought out its version of Unix targeted at the same opportunity that Linux is primarily targeting? What if it focused on making its version interoperable and provided full source code access, plus wrapped the whole thing with better developer tools and support than any of the Linux providers could field, and then dropped it under the same pricing and support programs Windows Server enjoys? Bet that would do better than the "Get the Facts" campaign did.

Dell Linux

I've been reading a lot of posts on why Dell will -- or will not -- preinstall Linux. It amazes me how little Linux folks know about the economics surrounding the desktop, which probably goes a long way toward explaining why the Linux desktop market share is so low.

The core problem is that right now, Linux is not profitable on the desktop for a company like Dell. This has nothing to do with "Get the Facts" or TCO (total cost of ownership); it has to do with pricing and cost structure.

Here is a quick primer: For a Windows desktop, let's say the competitive price for the hardware is US$500 (and Dell's cost is $450), and Windows costs an additional $100. People then pay $600, Dell gets the $500 and takes in $50 initial profit -- out of which it pays support costs. Microsoft gets $100 but then gives back money to Dell for marketing, support -- both internal and external -- and any secondary sales incentives.

For Linux in the same $500 PC, let's say Linux is priced at $50. The buyer wants Linux to be free and gets a steep discount -- most of which Novell or Red Had may eat. This leaves little or no money for support or marketing of the product.

In addition, the buyers are often not that experienced with Linux -- the experienced Linux users tend to roll their own hardware/software -- which drives up support costs. Also, people are all over the map with regard to distributions, which further drives up both the number and cost of support calls.

Finally, buyers of Linux want the very cheapest hardware where the margins are the lowest -- once again making a margin problem vastly worse.

Another Story

Now, on servers -- because they can generate a lot of services revenue, and because the OS cost can be quite a bit higher, due largely to things like client access licenses -- the price delta between Windows and Linux isn't a huge problem. In fact, it plays like an advantage, even though you would think lower price would be better, right? On the desktop, lower price actually results in low, no or negative margins, and the vendor is clearly motivated to sell fewer products.

Dell's challenge is to find a way to make money selling Linux machines. If it could charge as much, or more, than it can for Windows, it could do that, and were this Unix, it could charge a premium -- but when people think of Linux, they think of "free," and that limits Dell's options.

Every indication I get from Dell is that it wants to do this, but it won't sacrifice margins to do it, because the company simply can't afford to. Unless that gets fixed, I can't see Dell getting too excited about selling desktop Linux.

What if Dell brought out Linux as a premium offering? Kind of channeled Apple and created a solution that actually was on higher-end hardware, provided a better Linux user experience, and charged a premium for that experience? You would know you would get the help with Linux you needed, without being pounded by a Linux fanboy for asking the wrong question.

If that worked, Dell could do Linux and make money doing it, making the whole thing much more attractive to every OEM (original equipment manufacturer). Oh, but wait, the Free Software Foundation would have a cow. Never mind...

How a Virus Can Get You Fired - or Worse

Last year, a substitute teacher named Julie Amero was teaching classes when her computer started displaying X-rated adware. The system was running Norton Antivirus, but it was a year out of date. She not only got fired, but also has been charged with a number of crimes that probably will make it impossible for her to get another teaching job. I actually thought this was a hoax initially, but there is enough coverage -- including by McAfee -- to suggest it isn't.

Now, in court, she was asked why she didn't turn off the computer, and why she didn't at least close the lid, and her inability to answer -- and the fact that she changed her story from one blaming the kids to one blaming viruses -- got her convicted. She wasn't believed. Then this letter showed up on the Web, suggesting she told the truth.

It got me to think back on when I was a kid and we had a substitute teacher. There was one class where all of us were insane -- I was actually one of the comparatively quiet ones, which if you knew me at the time, says a lot about what we were like.

We had a competition as to how fast we could either get the substitute to cry or call for help. It was like a mob mentality. If this computer had been in that class, the dirty pictures would have been the least of the problems.

Given this was a female teacher, it isn't hard to imagine that her story is true -- even though it seems far-fetched to those of us who are more tech-oriented. Recall that there really are people who think CD drives are cup holders or who might be afraid to touch a PC for fear they would break it.

Besides the obvious problems for those in education -- which does suggest that password-protecting PCs, keeping them behind proxy servers, and keeping the antimalware products up to date -- this could get employees fired in a number of firms I know.

Let's say your kid is playing with your laptop, hits a few porn sites, and your machine gets pulled as part of a security audit. Or a coworker's prank goes wrong. That porn or record could lead to disciplinary action, including termination. The defense that it must have been your six-year-old probably wouldn't be believed, even if it were true.

This is yet one more reason to keep your computer safe, to avoid untrusted Web sites like the plague -- porn sites in particular -- and to keep your kids and your "funny" coworkers off your PC.

Given Julie is out $25K and can't get a job, I'm thinking you wouldn't find this any more funny than she did, so be careful out there.

Rob Enderle is a TechNewsWorld columnist and the principal analyst for the Enderle Group, a consultancy that focuses on personal technology products and trends.

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