How To Beat Microsoft
By Rachel Alexander (05/31/03)
Lawsuits by the government and competitors against Microsoft have failed to break down Microsoft’s monopoly within the software industry. This has just reinforced the free market argument that the real way to beat Microsoft is through competition. Unfortunately, most of Microsoft’s most promising competitors have failed to do the four things necessary to beat Microsoft – sell easier to use products, at a cheaper price, using mass simple advertising, and address compatibility issues adequately.
Microsoft can be beaten because it fails badly in one of these three categories, cheaper prices, and it is increasingly beginning to fail in the area of compatibility as it attempts to force its own standards on the industry.
Companies should look to AOL, the leader in Internet service, as a role model for taking on Microsoft. AOL successfully beat out Microsoft’s MSN for the top spot in internet access, with currently around 27% of the market in the U.S. and over 15% of the world market. AOL stays at the top by providing fairly cheaply the easiest-to-use Internet service along with easy-to-understand marketing and compatibility with Microsoft’s operating systems and other popular products.
Microsoft’s primary dominance is in its operating systems. What most software companies forget is that most consumers are overwhelmed by computer technology and the fast pace of ever-changing technology. While nifty little gadgets like Linux’s “menstrual calendar” – which comes bundled with some variations of Linux - may seem cool to techies, they make the Linux operating system appear more confusing and complex to the average consumer. Furthermore, this program in particular is offensive to women. Windowmaker, a desktop theme program that also is included with various versions of Linux, includes a picture of a nude woman as a desktop background. There are already enough compatibility problems between non-Microsoft operating systems and standard software products to scare most consumers away. Why scare them off even more? Furthermore, these types of programs are unacceptable in the workplace. Linux needs to clean up its act before it can become a serious player in the business world.
Nevertheless, open-source software such as Linux is preferable to proprietary software because it allows for optimal innovation, and makes it less likely that one company will dominate the market. Microsoft’s stinginess with making its products compatible with competitors’ products protects its dominance, but a smart competitor could use this to its advantage. Until that smart competitor figures out how to do this, incompatibility issues pose a huge barrier for open-source. Since most businesses and consumers are still using Microsoft products, open source software needs to be compatible with Microsoft’s products, at least for now.
Sourceforge.net offers thousands of open source products that are compatible on many platforms. However, most consumers aren’t interested in any products other than the most basic – operating system, email, web browser, and office applications. If companies truly want to be competitive with Microsoft, they need to focus on these essential products that the masses of consumers need, not obscure gimmicky programs. If a few software companies stopped their thrust towards creating obscure programs, they could focus more time and energy on improving compatibility issues with the primary core of products that most consumers are interested in. Open Office is showing promise as a true competitor to Microsoft’s Office suite. It is freely downloadable or it can be bought cheaply from Sun Microsystems as Star Office, and it is compatible with Microsoft’s software – it can read Microsoft’s .doc documents, which is a crucial area of compatibility.
Taking on Microsoft, however, primarily requires beating it at its core – operating systems. Linux, the open source operating system that is free for users and inexpensive for businesses, is touted as Microsoft’s most serious competitor. Linux has made some inroads into the server side, and currently holds around 15% of the server operating system market. However, Microsoft’s new .Net systems are already becoming extremely popular, and in the desktop operating systems arena, Microsoft systems still account for more than 90 percent of all sales. Linux’ share of the desktop market is currently at 2 percent, and is expected by some not to grow over 5 percent by 2006. Linux has made some progress with its “Lindows,” which is an easy to use version of Linux that looks and acts like Microsoft’s Windows, and is sold bundled with PCs sold at Wal-Mart starting at $199. Lindows, however, after a promising start, backpedaled on compatibility, retracting its promise to make Lindows compatible with all Windows programs.
Fortunately, a lot of software compatibility issues are going away on their own as Internet technology changes. Commonly used applications are migrating to the web instead of being sold as standalone programs. There are a few leading versions of Linux that have made their way into businesses and regular consumers’ desktops. Last year, the German government signed a contract with Linux SuSE, through the UnitedLinux group, to put Linux on computers at all levels of government. Numerous large companies have begun using Linux both as server software and on desktops.
It may not be glamorous to compete with Microsoft, but if software companies are serious about beating Microsoft, they are going to have to focus on the four key factors and drop the techie mystique. Only after they have beaten Microsoft, and have revenues to spare, should they consider promoting offbeat and often questionable programs of poor taste.
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