March 1, 2003
@ 03:58 PM
Comments [0]
How Not To Run A Business
Scoble's post starts with some good points; the B0rg disparaging Open Source products tends to backfire, attempting to compete with Open Source products as if they are conventional companies is misguided, and talkingh about future products justs gives them ideas which is unwise since they can ship faster/more often. However is explanation for the motivation of Open Source folks falls flat. People like Linus, Theo, Miguel De Icaza, Sam Ruby, Larry Wall, Rusty Foster, etc. aren't driven by anti-Microsoft feeling any more than the typical B0rg is driven by anti-GPL motivations on a day to day basis. There are people who are in it just to fight Microsoft but this people have always seemed to me to be a vocal minority and not the core of the Open Source movement.

Scoble's post quickly goes downhill when he attempts to suggest ways to compete with Open Source products. One thing I've recently been made to ask myself as a Program Manager working in the Belly of the Beast is how do the technologies I am working on and the actions I take affect the bottom line? This should be the core question behind any strategic decision at the corporate level.

However you slice it, it is very apparent that Open Source commoditizes software. Given that a significant portion of B0rg revenues come from software it is unwise and bordering on suicidal for the company to actually encourage Open Source software and even worse offer it as alternatives to commercial products. Unsurprisingly Scoble cannot point to any significant financial benefits of the corporate hari kari he is suggesting Microsoft commit. However he does rightfully point out that such ill considered actions might enrage share holders (I'm one and I'd be pissed) and may backfire making the Open Source movement even larger.

He seems blinded by a naive misbelief in the quality of Open Source software. A strategy consisting of advertising the competitors software in the arrogant belief that it is so poor that customers will try it, dislike it and then run back to your product is phenomenal hubris. Scoble's advice to Microsoft is the equivalent of telling the B0rg to throw in the towel.

The B0rg needs a decent long term strategy against Open Source if they want to compete. Products like Linux, *BSD, Apache, and JBoss have shown that once Open Source projects are through playing catchup they can innovate as quickly as commercial products and significantly undercut them on price. The worst thing Microsoft can do is fail to learn from the rest of the software industry and underestimate Open Source which is exactly what Scoble advises. In the near term, I believe Open Source is still not a significant threat to the B0rg but looking forward 5,10,15 years I can't say the sentiment extends that far. It will be interesting to see what the execs do to tackle this threat in the coming years.
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Disclaimer: The above comments do not represent the thoughts, intentions, plans or strategies of my employer. They are solely my opinion.
 

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