18 June 2004 When Microsoft’s UK marketing director Nick Barley opened his company’s “Get the Facts Roadshow” in London last week, designed to dispel some of the ‘myths’ about the Linux operating system, he remarked that supporters of the open source operating system are waging a “Jihad” against his company and its Windows product line.
The metaphor suggests that the software giant is facing a long and bitter struggle against irrational fanatics who are passionately anti-Microsoft.
But there was nothing extreme or irrational about the way in which Munich City Council this week calmly and democratically dealt Microsoft one of the biggest blows it has suffered in its short corporate history. After a year’s trial, the City’s burghers voted 50-29, in a closed door meeting, to migrate all of its 14,000 Microsoft based desktop computers over to Linux, the Open Office desktop suite, and the open source Mozilla browser.
The contract is not huge – with the initial training and implementation, it is believed to be worth less than €20million – but it is very high profile, with key suppliers on both sides viewing this a key battle in a long war. Microsoft’s CEO Steve Ballmer famously broke off a skiing trip to travel to Munich and offer huge discounts if the City stuck with Microsoft, while IBM and Novell, owner of the Linux operating system supplier Suse, both gave thousands of hours of expertise to help run the pilot. (Even then, Munich admitted to Information Age in January 2004 that the trial had suffered “technical difficulties”.)
The end of the trial now means that the contract to supply the systems will now be put out to tender – following the rigorous rules set out for public purchasing by the European Commission. HP, Dell and IBM are expected to be among the bidders.
Throughout Europe this year, a succession of public sector authorities have announced plans to migrate to Linux, but in most cases this has meant moving from Unix servers to Linux servers, often staying with the same hardware supplier. Very few organisations have migrated their desktops to Linux. Many of those evaluated Linux are worried about possible instability, the potential loss of key features in Microsoft’s Office Suite, possible file incompatibilities, especially when exchanging documents with trading partners, a lack of skills, and staff resistance.
Microsoft executives dismissed the Munich decision, saying that there are peculiar factors involved and that IBM had helped to drive the decision. Even so, Microsoft is becoming worried – as its Roadshow demonstrates.
Analysts believe Munich is a crucial milestone, that will accelerate adoption of Linux on the desktop. IDC has forecast that Linux desktop market share will grow from 3% to 6% from 2004 to 2007. Although Microsoft’s share is currently a massive 95%, the loss of 3%-4% share amounts to hundreds of millions of dollars lost in Windows and Office licences. If that share were to fall faster, as Linux proponents believe is likely, then Microsoft would begin to suffer serious financial consequences.
Meanwhile, some journalists have been questioning Microsoft’s marketing tactics, suggesting that the Roadshow shows “fear” that businesses will pick up on. But Microsoft believes that in a war like this, it has to take the offensive.
