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The first three months of the year were defined, in the technology sector, by some very scary numbers. Just feast your eyes on some of these. Apple, we learned, pulled in profits in just three months of over $3bn. That’s not in a year – that’s just in a quarter. That number doesn’t account for sales of the iPad either, its latest bizarre contraption, for which the numbers are due to hit in the next round of figures.
Microsoft is happy to play the numbers game, too. It’s been buoyed by the fact that Windows 7 is the most successful iteration of its operating system to date, and that its numbers are trouncing those of Windows Vista. As such, how much has Microsoft – a company that was pruning its staff numbers on more than one occasion last year – brought in in profit for the first three months of the year? Ah, that’ll be a cool $4bn. Four. Billion. Dollars. You could cut VAT with that. By anyone’s measure, they’re scary, scary figures. It gets more staggering if you look at straight revenue before profit. Here, Apple snared $15.68bn. Microsoft’s revenue was $14.5bn.
What also becomes clear from these numbers is that Apple and Microsoft support an ecosystem of firms that rely on them for much of their income. Take the profits being reported at chip-maker ARM, which makes technology for Apple products. Look at the knock-on software purchases that tend to go with a copy of Microsoft Windows. Bluntly, when Apple and Microsoft are bringing in the loot – over $10bn a month between them – there are financial ramifications right down the chain.
It’s little surprise then that there’s not much incentive for retailers and e-tailers to challenge the status quo. We saw this most clearly with the first wave of netbook computers, which infamously arrived with Linux, rather than Windows, installed upon them. And while there’s a degree of smoke and mirrors about the scare stories that followed – higher return rates on machines with Linux installed, for instance – the bottom line became that retail couldn’t wait for Microsoft to sort out its operating system for netbook suitability.
After all, look again at the ecosystem. As has been pointed out by better people than me, a sales rep in PC World will be acutely aware that if they sell a machine with Linux on it, then that’s the last software sale said store is likely to make to that customer. Notwithstanding the fact that open source software is freely and widely available, there’s the fact that you simply wouldn’t need to go back to buy a copy of McAfee Anti-Virus or something of that ilk. You just wouldn’t need to buy software solutions for problems that simply don’t exist in the Linux world.
As such, from a short-term business perspective – and retailers would argue that it’s a long term one as well – there’s little point pushing open source in any kind of environment where one eye is always going to be on what they can sell a person next.
And thus you come back to the kind of retail ecosystem that’s now got to such an advanced stage that two individual companies are controlling massive, massive amounts of business. Bringing in the kind of profits that could chop a solid percentage off the national debt of this fair nation in just a year.
In spite of being a passionate believer in open source, I can’t help feeling that that kind of big battle, fighting the control that Apple and Microsoft exert on their respective markets, is not a winnable one. That’s not an ideal scenario, and that doesn’t mean that open source can’t make and isn’t making major inroads. But it’s one of those instances where a bit of expectation management won’t do much harm…
Click here to see what else featured in issue 88 of Linux User & Developer magazine…