The Eight Faces of Vista
by Kevin Carmony
February 23, 2006
Microsoft has hinted that their next version of Windows, called Vista, will debut with up to eight different versions. Although not definitive, the list includes:
[*]
[*]Windows Starter 2007
[*]Windows Vista Business
[*]Windows Vista Business 'N' *
[*]Windows Vista Enterprise
[*]Windows Vista Home Basic
[*]Windows Vista Home Basic 'N' *
[*]Windows Vista Home Premium
[*]Windows Vista Ultimate
[/list] [/list] [/list] One of the signs of a monopoly is limited product selection. Back in 1908 when Henry Ford started shipping the Model T, he figured out that the cheapest way to produce cars would be to standardize everything. Over the next 20 years or so he proved his point by shipping more than 15,000,000 cars. Ford rarely changed the design throughout this period, telling his customers they could get a Model T in any color they wished, "so long as it was black."
style="color: rgb(0, 0, 0);">http://en.wikipedia.org/wiki/Henry_ford
style="color: rgb(0, 0, 0);">Henry Ford
However, Alfred Sloan, Ford's peer and President and Chairman for General Motors, realized that you could in fact introduce changes in design at a minimal cost and that customers would actually be prepared to pay for those changes so that GM's products would be differentiated. Sloan developed a series of models using the same chassis, drive train, wheels, etc., but offered them in all kinds of colors and shapes, and then charging customers 15% to 20% more than Ford was charging. The customers loved it and flocked to make choice-driven vehicle purchases.
According to Wikipedia, Sloan also established a pricing structure in which GM brands Chevrolet, Pontiac, Oldsmobile, Buick and Cadillac did not compete with each other, and a buyer could be kept in the GM "family" as their buying power and preferences changed as they aged. Sloan's inventive strategies, along with Ford's resistance to the change in the 1920s, led GM to lead industry sales by the early 1930s, making GM the largest and most successful and profitable industrial enterprise in the world at that time.
For almost 20 years, Microsoft has followed Henry Ford's business model, giving users little choice in the "color" of their operating system - an indicator of their monopolistic hold on the desktop computer. Why offer 10 or 20 different "styles" of their OS when it's less costly for Microsoft to offer only one or two? Likewise, if you're a monopoly, why offer competitive prices rather than just one high price?
style="color: rgb(0, 0, 0);">
style="color: rgb(0, 0, 0);">Alfred Sloan
One of the signs of a healthy and competitive commercial landscape is product differentiation and the targeting of products for specialized groups. Let's look at something as basic as toothpaste. Right from their own web page, here is a list of over 60 kinds of different toothpastes offered by Colgate alone! Between Colgate, Crest, AIM, Aquafresh, Arm & Hammer, Reach, Rembrant, Ultra Brite, Pepsodent, Mentadent, and several others, you have HUNDREDS of choices!
Colgate, because it has so many competitors, must continually innovate and specialize to keep and grow their market share. Having a variety of products also ties up a wider area of shelf space in stores, forcing retailers to display a multitude of boxes, all carrying the Colgate brand.
So, how is it we have over 60 choices of TOOTHPASTE from Colgate, but Microsoft has for the last 20 years only given us a few choices for our desktop operating system? How much more sophisticated is an OS than toothpaste?
Why would Microsoft, after 20 years, start offering more options? The answer is plain and simple: competition, particularly from the open source Linux operating system. For example, Microsoft's "Starter Edition" is a response to trying to compete with Linux in emerging markets. When you have a monopoly, you don't need to have different products. Just have one or two, charge top dollar, and enjoy your windfall profits. The fact that Microsoft appears to be planning to offer several "flavors" of Windows with Vista's release is a good sign for consumers that they are starting to finally feel at least some competitive pressure. Now, you can still plan on Microsoft (a twice-convicted monopolist) to continue to exercise their enormous control over the OEM and retail channels, and do everything they can to squash Linux and competition, but at least we're seeing the very early signs of some slight bending to competitive pressures.
style="color: rgb(0, 0, 0);">
style="color: rgb(0, 0, 0);">The Colgate Advantage
Some are so accustomed to Microsoft's monopoly that they actually are complaining about the new options Vista will present. They have been so drugged on the notion that "one size fits all" that they find even just eight choices "confusing." Choice is a good thing. It allows for consumers to purchase a product that is more tailored to their very specific needs, and only pay for those things THEY will use. I'd argue eight isn't nearly enough. For example, where's an operating system for small children? One for engineers and developers? One for the elderly? One specifically for graphic designers? And so on.
As for Linux, some complain that there are "too many" versions ("distributions"), but if you're the person using one particular Linux, you're glad that choice exists. Free markets have a way of finding the right balance. If Colgate wasn't successful and making money on every one of those 60 toothpastes, they'd save the trouble and wouldn't offer them. Enough people must be happy with each of these specific offerings to make them viable products, which means there are a lot of people happy with that specific product and who are glad it exists. The key is not fewer OS choices, but rather to have BETTER INTEROPERABILITY between MANY MORE choices, which is why monopolies like Microsoft fight against interoperability.
One of the wonderful things about Linspire is that we can use our CNR (click and run) technology to start with one baseline OS, and using Aisles, with one click users can customize the OS to exactly the experience they want. This allows Linspire to offer dozens of varieties of our OS, but with one set of packaging. Unfortunately for Microsoft, they don't have anything like CNR, so they can't use that argument. ;-)
Just like Ford lost its early leadership role to GM, so too could Microsoft one day face a similar challenge from Linux. I look forward to a world with not only three, five, or even eight choices for your desktop OS, but dozens, all interoperating beautifully together! Choice is a good thing, and a sign that competition is alive and well.
Kevin
*Windows Vista Home Basic and Windows Vista Business will also be available in an 'N' version, which comes with the Windows Media Player. As part of the settlement to the antitrust case in Europe, the EU stipulated in late 2004 that Microsoft needed to provide versions of Windows without their Media Player included.
by Kevin Carmony
February 23, 2006
Microsoft has hinted that their next version of Windows, called Vista, will debut with up to eight different versions. Although not definitive, the list includes:
[*]
[*]Windows Starter 2007
[*]Windows Vista Business
[*]Windows Vista Business 'N' *
[*]Windows Vista Enterprise
[*]Windows Vista Home Basic
[*]Windows Vista Home Basic 'N' *
[*]Windows Vista Home Premium
[*]Windows Vista Ultimate
[/list] [/list] [/list] One of the signs of a monopoly is limited product selection. Back in 1908 when Henry Ford started shipping the Model T, he figured out that the cheapest way to produce cars would be to standardize everything. Over the next 20 years or so he proved his point by shipping more than 15,000,000 cars. Ford rarely changed the design throughout this period, telling his customers they could get a Model T in any color they wished, "so long as it was black."
style="color: rgb(0, 0, 0);">http://en.wikipedia.org/wiki/Henry_ford
style="color: rgb(0, 0, 0);">Henry Ford
However, Alfred Sloan, Ford's peer and President and Chairman for General Motors, realized that you could in fact introduce changes in design at a minimal cost and that customers would actually be prepared to pay for those changes so that GM's products would be differentiated. Sloan developed a series of models using the same chassis, drive train, wheels, etc., but offered them in all kinds of colors and shapes, and then charging customers 15% to 20% more than Ford was charging. The customers loved it and flocked to make choice-driven vehicle purchases.
According to Wikipedia, Sloan also established a pricing structure in which GM brands Chevrolet, Pontiac, Oldsmobile, Buick and Cadillac did not compete with each other, and a buyer could be kept in the GM "family" as their buying power and preferences changed as they aged. Sloan's inventive strategies, along with Ford's resistance to the change in the 1920s, led GM to lead industry sales by the early 1930s, making GM the largest and most successful and profitable industrial enterprise in the world at that time.
For almost 20 years, Microsoft has followed Henry Ford's business model, giving users little choice in the "color" of their operating system - an indicator of their monopolistic hold on the desktop computer. Why offer 10 or 20 different "styles" of their OS when it's less costly for Microsoft to offer only one or two? Likewise, if you're a monopoly, why offer competitive prices rather than just one high price?
style="color: rgb(0, 0, 0);">
style="color: rgb(0, 0, 0);">Alfred Sloan
One of the signs of a healthy and competitive commercial landscape is product differentiation and the targeting of products for specialized groups. Let's look at something as basic as toothpaste. Right from their own web page, here is a list of over 60 kinds of different toothpastes offered by Colgate alone! Between Colgate, Crest, AIM, Aquafresh, Arm & Hammer, Reach, Rembrant, Ultra Brite, Pepsodent, Mentadent, and several others, you have HUNDREDS of choices!
Colgate, because it has so many competitors, must continually innovate and specialize to keep and grow their market share. Having a variety of products also ties up a wider area of shelf space in stores, forcing retailers to display a multitude of boxes, all carrying the Colgate brand.
So, how is it we have over 60 choices of TOOTHPASTE from Colgate, but Microsoft has for the last 20 years only given us a few choices for our desktop operating system? How much more sophisticated is an OS than toothpaste?
Why would Microsoft, after 20 years, start offering more options? The answer is plain and simple: competition, particularly from the open source Linux operating system. For example, Microsoft's "Starter Edition" is a response to trying to compete with Linux in emerging markets. When you have a monopoly, you don't need to have different products. Just have one or two, charge top dollar, and enjoy your windfall profits. The fact that Microsoft appears to be planning to offer several "flavors" of Windows with Vista's release is a good sign for consumers that they are starting to finally feel at least some competitive pressure. Now, you can still plan on Microsoft (a twice-convicted monopolist) to continue to exercise their enormous control over the OEM and retail channels, and do everything they can to squash Linux and competition, but at least we're seeing the very early signs of some slight bending to competitive pressures.
style="color: rgb(0, 0, 0);">
style="color: rgb(0, 0, 0);">The Colgate Advantage
Some are so accustomed to Microsoft's monopoly that they actually are complaining about the new options Vista will present. They have been so drugged on the notion that "one size fits all" that they find even just eight choices "confusing." Choice is a good thing. It allows for consumers to purchase a product that is more tailored to their very specific needs, and only pay for those things THEY will use. I'd argue eight isn't nearly enough. For example, where's an operating system for small children? One for engineers and developers? One for the elderly? One specifically for graphic designers? And so on.
As for Linux, some complain that there are "too many" versions ("distributions"), but if you're the person using one particular Linux, you're glad that choice exists. Free markets have a way of finding the right balance. If Colgate wasn't successful and making money on every one of those 60 toothpastes, they'd save the trouble and wouldn't offer them. Enough people must be happy with each of these specific offerings to make them viable products, which means there are a lot of people happy with that specific product and who are glad it exists. The key is not fewer OS choices, but rather to have BETTER INTEROPERABILITY between MANY MORE choices, which is why monopolies like Microsoft fight against interoperability.
One of the wonderful things about Linspire is that we can use our CNR (click and run) technology to start with one baseline OS, and using Aisles, with one click users can customize the OS to exactly the experience they want. This allows Linspire to offer dozens of varieties of our OS, but with one set of packaging. Unfortunately for Microsoft, they don't have anything like CNR, so they can't use that argument. ;-)
Just like Ford lost its early leadership role to GM, so too could Microsoft one day face a similar challenge from Linux. I look forward to a world with not only three, five, or even eight choices for your desktop OS, but dozens, all interoperating beautifully together! Choice is a good thing, and a sign that competition is alive and well.
Kevin
*Windows Vista Home Basic and Windows Vista Business will also be available in an 'N' version, which comes with the Windows Media Player. As part of the settlement to the antitrust case in Europe, the EU stipulated in late 2004 that Microsoft needed to provide versions of Windows without their Media Player included.
