7 ms·
Confidential Microsoft brief: 'We're toast if we fight Google on price'
- schrodingersCat 13y agoThere's something to be said about simplifying your product line. I guess msft's approach is: if we can't beat them on price, confuse the hell out of them?
- dorfsmay 13y agohttp://en.wikipedia.org/wiki/Fear,_uncertainty_and_doubt http://en.wikipedia.org/wiki/Fear,_uncertainty_and_doubt
- forgotAgain 13y agoI agree. I wonder if they appreciate how frustrating it is to deal with their licensing. Even more than price, small IT departments want to just get out from under that wet blanket. Why Software Assurance? It's all to Microsoft's benefit. If a company wants to upgrade then let them pay the discounted price and upgrade on their own schedule. Don't turn it into an annuity for the vendor.
- mathattack 13y agoIt's two different business models: Simplicity versus Total Solution. Starting from scratch simplicity usually seems better, but as companies grow they (for good financial reasons) wind up doing a lot of 1 off solutions in the name of flexibility and being customer-centric.
- luu 13y agoWe all know from experience … with Google Apps you can often have to add a lot of different third party appliances just to get to parity with the experience and then all of a sudden you've got lots of vendors to manage and all of a sudden it's very different to that low cost price point that Google initially positioned to the customer. This is an old story; shades of every high-end vedor that's ever been wiped out by a low-cost player. As a hardware guy, it reminds me of the response you'd hear from POWER, PA-RISC, Alpha, SPARC, etc. vendors when you mentioned x86 workstations. At the time, my response was, sure, maybe you've got a better product now, but what fundamental advantage do you have that keeps Intel from using their large, and growing, userbase and economies of scale to crush your R&D spending and pull ahead? Software doesn't have such high fixed costs, and MS has a ton of money to spend on R&D. But, this still sounds like a lame defense.
- mjolk 13y agoVendor management comes with a real cost (typically in terms of time). This might be more contentious, but I believe that people that are still using Windows Server (and Microsoft offerings other than AD) are doing so because it's easier to use/more familiar than Linux/open-source alternatives: Throw Joe-Linux on Acme-Cloud-Provider and use Weekly-Flavor-Config-Management? Sounds hard. Click some buttons and fudge your way through group policy? Now we're talking something I can do to pay off a mortgage.
- orf 13y agoThat and the fact that Windows server ties in nicely with the Windows workstations that the company uses. I use Server 2008 R2 (and upwards) at work and its really not bad, it's miles ahead of the previous versions which were horrible to use. Is it not possible that people use this stuff because its useful?
- kaeawc 13y agoIf you have a Windows server and you're writing .NET code the only option (of you want the latest .NET version) is to use Windows workstations. That's like saying OSX runs great on Macbooks. It is designed to do that.
- orf 13y agoI'm saying Windows Server ties in nicely with the desktop versions of Windows (managing permissions and accounts, AD, email, network resources etc). Its like saying OSX server works great with Macbooks. And my point was perhaps the reason people are using Windows server is not because Linux is too hard and unfamiliar but because just maybe it's a better fit.
- Retric 13y agoI think your missing the point. "It just works" is a huge selling point.
- homosaur 13y agoMS: "Let's fight them instead by giving as much user data to the government as possible, grab some more contracts. We need something reliable and easy to use. Does anyone know how to install Linux?"
- homosaur 13y agoHN: "We are NOT going to tolerate jokes here, this is Internet a.k.a. SERIOUS BUSINESS. Now let me tell you about my disruptive verticals."
- Spooky23 13y agoThis is the death of complete Microsoft dominance, not the company. Cloud email represents a relatively small portion (25-30%) of the total enterprise market, and Microsoft owns the on-premise market. Google is maturing as an enterprise vendor, and the simplicity of the licensing model and lack of client side software is appealing to the "new economy" companies: small businesses, businesses using Macs/BYOD and businesses using lots of freelancers/temps. For the traditional enterprise shops, Google can be a real pain. You need to buy 3rd party stuff for things like identity federation, for example. At the end of the day, it's called competition, and it's great. Instead of Ballmer & Co. coming down off the mountain and letting us know what we're going to do for the next 5 years, we have a real marketplace and can say no.
- kyllo 13y agoThe question now is, can Microsoft compete in a world where they are no longer a monopoly? They make almost all of their still-quite-impressive profit from the markets that they still completely dominate, like enterprise productivity software. They are probably losing money on products like Windows Phone and Surface. So what happens when Microsoft has credible competition in every market it sells to? That will soon be the case (if for no other reason than the fact that Google is actively trying to kill them), and I'm not sure even Microsoft is confident that Microsoft can compete and stay profitable in that environment. I see a lot of belt-tightening in their future. I don't really think a company can get--or stay--as big as Microsoft is, without the rent-seeking ability afforded by near-total monopoly of a major market.
- bdcravens 13y agoOf course. People will be buying Office licenses for a long time; there's too many companies with mission critical stuff that relies on Access or Excel macros. They'll continue to sell Server licenses for the many companies that have systems built atop SQL Server. When you're an entrenched solution as opposed to a potential rip-and-replace, you definitely have a competitive advantage.
- Spooky23 13y agoGood question. History (IBM) suggests that they can probably muddle through. You can ask the same question of Google. Enterprise with Google is a grown up hobby project that isn't a big earnings generator. Will google apps stay cheap if googles golden goose (advertising) declines?
- sz4kerto 13y agoIt's quite instructive to talk to big (>10000 employees) companies who tried to migrate to Google Mail/Apps. There are nice disaster stories around.
- lclarkmichalek 13y agoThere will be disaster stories around for any big migration. I can't say I'm particularly enjoying my university's migration to Microsoft's email offering.
- bdcravens 13y agoExactly. There's a tendency to throw around bullets points of advantage (It's open! It's not big-bad Microsoft, but a company you can TRUST! etc) as if the things are enabled by flipping a switch or the ethics involved are far more important than bottom lines.
- djim 13y agoThere are also some nice success stories around..what's your point? Lots of happy customers over 10k seats on Google Apps and Microsoft products.
- jsolson 13y agoI mean, you know, other than Google itself. We do pretty well with a more or less entirely Google Apps workflow.
- dmm 13y agoThe entire US Department of the Interior (~71k employees) switched to gmail this year. It seems to have gone pretty well. The most common complaint I've heard is that gmail doesn't support the custom smiley faces that Lotus did. The inbox size vastly increased (500MB => 30GB) which makes the record keeping much easier, just never delete anything. Before we had to empty our mail into offline archives. Everyone still uses office for word processing and spreadsheets. The online storage is nice for sharing files though.
- mtgx 13y agoIf companies, especially non-US ones, had any sanity, they'd "toast" both of them after the NSA revelations.
- djim 13y agoin favor of what alternatives?
- pjmlp 13y agoMaybe a Linux distribution running SELinux, nicely provided by the NSA. :)
- mtgx 13y agoSELinux is open source. At least you can verify and prove they it has a backdoor in it. Good luck doing that with Windows, Skype or Skydrive. Did you read about the Cryptocat security bug? We learned about it because it was open source. Maybe NSA found out about it even earlier, but at least we did, too, and fixed it. Now imagine the same type of bug was in Skype. Then NSA would be the only ones who know about it.
- pjmlp 13y ago> SELinux is open source. At least you can verify and prove they it has a backdoor in it. If you are able to decipher such backdoor in the code, or do you expect the code to have a comment saying /* backdoor */ ? http://cm.bell-labs.com/who/ken/trust.html http://cm.bell-labs.com/who/ken/trust.html
- venomsnake 13y agoWhy? A medium business running in Romania has much more to worry from Romanian government/tax authorities than US security agency overreach. And even if they do - where to go? A lot of non it companies don't have even real ops ... hosting your own email and servers is expensive in that case. And potentially dangerous a modest string of bad luck could wipe you.
- jjindev 13y agoApple is the most valued (market cap) platform company because it owns the affluence market and commands high margins across the board. Google has gone after the "next billion" users, people who don't have that kind of money. MS might be trapped in the middle, neither sexy enough to be Apple nor cheap enough to be Google.
- bornhuetter 13y agoYour comments only really apply to the consumer market. Microsoft's position in enterprise is extremely strong. Apple is not making any serious attempt to challenge that (and probably never will), but Google (and Linux) pose a real threat to Microsoft in the long run.
- jjindev 13y agoYes. I was thinking in terms of the three as consumer platform companies.
- decryptthis_NSA 13y ago*'We're TOAST if we fight Google on price' Assuming the offering is just the same, but for many it may be good enough
- snorkel 13y agoOffice suite is still the Adobe Photoshop of business software. Office is still deeply entrenched in businesses and holding on because it still offers the most features. For example, Excel vs. Google docs: you can do basic charts and graphs in Google docs, but clearly Excel has many more features, such as data analysis tools, and when you connect Excel to Microsoft SQL server you have reporting + data mart, where Google Apps offers nothing similar (not without a lot development work needed to set it up) Google Apps is good but often you still find businesses also need Office suite. If Google were to say, directly connect Google docs to a data warehouse tool such as Dremel, the add a lot of advanced data analysis features to Google docs, then things would start to get interesting.
- leoedin 13y agoDon't forget the millions, perhaps billions of dollars spent by organisations developing complex Excel/VBA based software. Short of copying to Docs every single Excel feature and quirk, there's no way Google can compete in that area. It will probably take a decade after everyone stops developing new software in Excel/VBA before organisations can think of moving away from it. Most large companies haven't stopped yet.
- dvmmh 13y agoAlthough true, Google is nibbling around the edges. There are a lot of edges. It's enough to put a crunch on M$.
- ashayh 13y agoExcel has vastly more features than Google Docs. At all the companies where I've worked at, I've never seen anyone use anything more advanced than a few basic functions. The _vast_ majority of users in a corporate environment use: 1> Font changes (color, size etc) 2> Images 3> Hyperlinks, ToC and other forms or document organization. It is silly to buy 1000 Desktop or Office 365 Excel licenses, when only 20 people will use a substantial amount of its features. More importantly, people are not emailing each other Office documents. I've seen companies who do _have_ google docs do it.
- 13y ago
- markm248 13y agoOr said another way: 'We're TOAST'.
- redrocket 13y agoMicrosnitch is already TOAST. Who amongst you that use their products still trust them?
- kjackson2012 13y agoIs this "revelation" really that interesting? Everyone knows that Microsoft can't fight anyone based on price. Every salesperson in the same situation knows that the only way to fight low price is by selling based on perceived value. "Oracle is expensive, but if you compare its value, it's much cheaper." BMW can't compete vs a Hyundai based on price, they need to compete based on perceived value. For me Hyundai is more than adequate, because I only look at my car as a way to transport myself, not as a status symbol or an extension of my being. For those that do, good for them, and they will find value in a BMW. Same goes for MSFT vs Linux or GOOG, etc. There's nothing new here.