Analysis — Microsoft is fighting to win over the minds and pocketbooks of IT decision makers inch by inch with its latest “Get the Facts” on Linux effort and
an extension of its mainframe migration resource site.
The latest moves come after the company warned that software licensing revenue would be seasonal and would show only modest growth in the first quarter of 2005.
In addition, Microsoft is looking for growth amid a U.S. PC market that’s close to saturation. While it looks to the developing world for sales of the Windows client, it must press into the enterprise and open new avenues, such as supercomputing.
Redmond will continue what some call an “anti-Linux” campaign, even as it continues to release code to the open
source community. Yesterday, it posted
FlexWiki, an ASP.NET implementation of wiki software, to the SourceForge open source code repository. FlexWiki was
the third project offered in SourceForge.
Amanda Morgan, manager of the Get the Facts campaign, said the campaign is an effort to “try to move from an
emotional debate to a discussion based on facts.”
As Linux has evolved from a grassroots movement to commercial products, customers will need actual data points
to base their decisions on, she said. “That’s where we decided to put a lot of our energy.”
The campaign has been highly controversial. When Microsoft published the first white papers, some Linux advocates
charged that some total cost of ownership analyses were tainted because Microsoft had commissioned them, while the
analysts stood by their conclusions.
In August, the Advertising Standards Authority, a United Kingdom agency charged with monitoring fairness and accuracy in
ads, ordered Microsoft to pull an ad based
on a server test conducted by META Group. The ASA found that claims that Linux is more than 10 times more expensive
than Windows Server 2003 wasn’t supported by the tests. The study in question remains the top report on Microsoft’s
Get the Facts site. Morgan said she did not know whether the study was independent or Microsoft-funded, and that
information isn’t provided on the site.
Microsoft has certainly acknowledged the Linux threat. In its fiscal year-end annual report, it warned of
competition from Linux in its client, server and embedded lines of business.
But Morgan, who wrote the filing, said it’s a financial document that doesn’t really reflect the company’s
attitude toward open source. “I wouldn’t say it’s a threat,” she insisted. “It’s another entry point in the marketplace
that challenges Microsoft to think about customers, to think about facts.”
She said the top question asked by Microsoft customers is, “What does ‘free’ mean? What am I paying for? What
questions should I ask IBM when they push Apache and WebSphere?”
She pointed to case studies on Equifax and the Borough of Newham in the United Kingdom.
The white papers, she said, tell customers,
“Here’s how they made their decisions and the data points that they took to make a comparative data point.”
Newham said it based its decision on a study by Capgemini that reported Windows would be cheaper than moving
to open source for the borough.
But an independent consultant charged
that the figures Newham and Microsoft cited in their joint press release were different than the original Capgemini
report, which was available to the public.
“There was no independent verification by Capgemini of the cost of ownership figures and migration costs that were
supplied by Microsoft,” said Eddie Bleasdale, president of netproject, an IT consultancy specializing in helping
businesses migrate to open source. Bleasdale and other observers believe that Microsoft lowered its prices to get
the business.
Morgan said she was not aware of the controversy. She said that customers weren’t concerned about who funded
studies. “Because the methodology was open and transparent, I haven’t encountered one customer that questioned it,”
she said. “Customers understand the analysts’ business model.”
Microsoft will continue Get the Facts, adding other topics, such as migration from Unix to Windows.
On that note, Microsoft today also extended its Mainframe Migration Alliance (MMA), first launched in April. The
alliance is both a marketing tool for Microsoft and partners and a resource for customers that are considering moving
their enterprise applicants onto the Windows platform.
Resources include an alliance directory, white papers outlining best practices for migration, ROI calculation tools
and case studies of companies that have successfully made the switch.
“The online community is a central resource for customers who want to understand what their options are,” said
Tim O’Brien, a product manager in Microsoft’s platform strategies group.
Microsoft has for a long time offered tools that let developers write applications on Windows then move them to
mainframes, he said, but thanks to the increasing speed and lowering costs of hardware, customers found that such
apps were slower when they went into production than in the development environment.
“The strategy is to make the market of mainframe users aware of the successes other customers have had,” O’Brien
said. He denied that the strategy follows the Get the Facts campaign. While Microsoft hired analysts to conduct benchmark
tests for the latter, he said, “This is real customers in real mission-critical situations.” He added that Microsoft
has around 60 actual case studies of mainframe to Windows migrations.
Michael Cherry, an analyst with the research firm Directions on Microsoft, said that while Microsoft’s Host
Integration Server, which enables access to programs running on mainframes, is a strong product, he wasn’t sure
there was a lot of opportunity for Microsoft in mainframe migration. Some programs run on mainframes would be hard
to duplicate on Windows, he said, because they use mainframe-centric file formats, languages and databases.
“Despite all this talk that mainframes won’t exist anymore, you don’t see them disappearing,” he said.
At the same time, Cherry said, it makes sense for Microsoft to beef up its resources for the mainframe sector.
“All of these markets are certainly important,” he said. “If you’re Microsoft or some other company, you don’t want
to lose business from any of them because you don’t have services or support.”
Both initiatives do point to a company-wide focus on the customer in the face of increasing competition from all sides.
“Even Steve Ballmer has said they all need to listen more to the customer across the board,” Cherry said. “They
need to make sure that any initiative from Microsoft addresses something the customer really needs and isn’t an
attempt to shoehorn a product into the customer’s environment.”
While Morgan wouldn’t allow that listening to customers was a new tactic for Redmond, she said,
“In the last year, executives across the company really want to understand. When I’ve set them up with customer
engagements, they’re not going in to sell, they really want to understand.”
