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Saturday, February 26, 2005

IBM's Post Lenova Strategy : No Microsoft Code And No Place For Intel Inside The Box !!

We recently covered Software Will Determine The Success Of The Cell Processor echoing cringley's view that since processors do not drive applications, one does not find the announcement of a new processor all that simulating. Here's an update with missing piece of information governing IBM's strategy. IBM's Cell workstation (9 nanometer) prototypes are running both SUSE Linux and IBM's own AIX and represent IBM's post-Lenovo micro strategy – performance comparable to xeon processors - the dell price for xeon processors is 3000$ as against IBM’s 1000$. The IBM hardware strategy is to sell a box that contains no Microsoft code at all, and so requires no license payments to Microsoft and possibly no license payments to ANY company, including Intel. Any CIO / home user facing the forced upgrading of half or more of your PC-installed base immediately and probably the other half a year later, the opportunity to move away from Microsoft and toward IBM while saving money at the same time has to be compelling.
Microsoft’s anti-virus and anti-spyware products are aimed solely at users of Windows XP SP2. This has very different effects on both the user base and the software industry. For users, it says that anyone still running Windows 98, ME, or 2000 has two alternatives - to upgrade to XP/SP2 or to rely on non-Microsoft anti-virus and anti-spyware products. This forces 100+ million-PC owners to upgrade which is $10 billion in additional revenue of which $9 billion is profit - all of it coming in the next 12 months..If the upgrade options to XP/SP2 are not availed – then we have to rely instead on third-party products to protect the system. Microsoft , has transferred their entire support obligation for these old products to companies like Symantec and Network Associates without transferring to those companies any revenue stream to make it worth their trouble. Third party supporters by not being able to provide free support shall force users into the same upgrade from which Microsoft gains all the revenue.Cringley writes,"The objective of any Microsoft product upgrade is to stimulate sales. There are two ways to stimulate sales"- forcing users to pay for software upgrades or forcing users to pay for hardware upgrades that carry software upgrades with them. It would have been nicer had they taken the course of improving Windows to make it less vulnerable - a course that itself would have stimulated sales. A large segment of users who see themselves as having to get new hardware might well consider abandoning Windows at the same time.Definitely thoughts to ponder - we need real choices in terms of usinf software in the desktop and if IBM's strategy helps it - all the more merrier.

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Sadagopan's Weblog on Emerging Technologies, Trends,Thoughts, Ideas & Cyberworld
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