Microsoft has such a nice slogan. "Where do you want to go today?"
But in truth Microsoft couldn't care less where you want to go. All they care
about is inflating their revenue at your expense. They'll tell you where to
go. And you will go along with it. You can go easy or you can go
hard...
A good example is the enormous market share that has been conquered by
Outlook and Internet Explorer. Well, of course these products are the most
widely used in the world! It's practically impossible to buy a PC without
Windows these days, and Windows comes with Outlook and IE. Setting up Windows
for its initial use involves the procedure for entering account data in
Outlook and the use of IE as the system's default browser. Switching from
these defaults to alternative products involves a consious effort on the part
of the user, removing Outlook and IE is practically impossible.
But coercing the user to stick with Microsoft-supplied Internet applications
is only a start.
Microsoft's prices have always been rather steep, but Windows XP offers
another striking example of Microsoft's price gouging policies. Windows
XP comes in two flavors: the 'home edition' and the 'professional edition'.
Of course they're essentially the same product: the same kernel, the same
user interface and the same bundled applications. At least Windows NT and
Windows 95 were products of an entirely different caliber. Microsoft had
intended to sell Windows NT and 2000 to the corporate sector and Windows
95/98/ME to the home and SOHO markets, but many companies used Windows 9x in
the office. So now the home edition of Windows XP lacks a few features that
are required in an office environment, such as network client support, group
policies and roaming profiles. You don't really get much more software for
your money when you buy the professional edition, but the few parts that
are missing from the home edition are exactly the parts you can't do without
in a corporate environment. No matter how you look at it, it's obvious that
Microsoft has decided to remove these portions from the XP home edition in
order to force the corporate sector to use the professional edition of XP,
which is about twice as expensive as the home edition.
Imagine that your automobile dealer wants to sell you a new car. You tell him
that you will use it to go to the office in the morning and perhaps to visit
a few customers as well. He tells you that for professional use you must buy
the professional version of the car you wanted, which costs twice as much but
comes with a nice 'professional' sticker on the doors.
Would you do business with him?
And it gets even better. A fine example of Microsoft's policy of
force-feeding their products to their customers, and a fair indication of what
Microsoft has in store for us, is the latest initiative to "simplify"
their upgrade policy. Instead of having to agonize over the decision when to
upgrade and having to choose between CUP, VUP, PUP or other upgrade schemes,
we are now reduced to only one simple option: we are required to buy and
install an update whenever Microsoft tells us to.
Under the so-called "Software Assurance Program", which has become
the only game in town as it replaces all existing upgrade policies, users had
to upgrade to Office XP before 1 October 2001 (notwithstanding the fact that
Office XP didn't hit the market before 31 May 2001!) or else be charged the
full price for a new license the next time they upgrade. (This included a
necessary hardware upgrade in many cases, since the XP product line doesn't
run well on pre-1999 hardware.) Existing upgrade agreements were terminated
on 1 October 2001. Just like that.
In fact the new update policy is an enforced subscription model. Software
Assurance is only available for 'current' versions of Microsoft products,
and Office 2000 was NOT CONSIDERED TO BE A CURRENT VERSION as of 1 October
2001, since Office XP had been released on 31 May, four months earlier.
Furthermore, Microsoft has carefully neglected to emphasize that this
extortionist scheme applies to all Microsoft products and not just
to MS-Office. As of 1 October 2001 all server products, all desktop products
and all application software had to be made 'current' and maintained under the
Software Assurance Program, at a price of 29% of the original software cost.
Microsoft also intends to "reevaluate" this percentage after two
years. (One exception: the enforcement of Software Assurance doesn't apply to
operating system products -- yet.)
As a result, many corporate customers faced an unexpected upgrade expense
(in many cases a large one) to avoid having to pay the full price for their
next upgrades. They also had (and will have) to implement brand-new and
barely tested "service pack zero" versions of Microsoft products, on
only four months notice before Microsoft declared existing upgrade policies on
mission-critical application software null and void.
The increase in software cost in the next few years will typically be about 35
percent for companies who upgrade once every three years, and can be anywhere
between 68 percent and more than 100 percent (!) for those with four year
upgrade cycles, as marketing research bureau Gartner has calculated.
Since the maintenance agreement Microsoft wanted customers to purchase after
the upgrade (before the October 1 2001 deadline) costs 29 percent of the full
software price, you don't have to wait much more than a year to break even by
not upgrading but putting the money in the bank instead of giving
it to Microsoft.
The new scheme leads to ridiculous situations in which it is often cheaper to
buy new software before the deadline and let it sit on the shelf for a few
years instead of installing it, rather than to upgrade three years or so from
now. Of course we'll eventually have to upgrade anyway, as new releases of
Microsoft products introduce incompatibilities with the versions that are
current today.
(Note: in an unprecedented response to pressure from large customers,
Microsoft declared a 'transition period' from 1 October 2001 to 28 February
2002 to ease the pressure a bit. This gave users a bit more time to cough up
the money for their mandatory upgrades. But apart from this minor delay,
which is essentially nothing more than a nice gesture, the new scheme remained
the same.)
At the time Gartner did the math, and their response didn't leave much doubt about the matter:
"Microsoft believes it has simplified its licensing; Gartner believes Microsoft confuses simplification with the elimination of options. Either way, most enterprises will pay much more. A typical enterprise with 5,000 desktops that upgrades Microsoft Office every four years will have its fees increase from $900,000 to $1.7 million."
Similarly, the 4,000-member Dutch Network Users Association calculated that 86% of its members face a price increase. NGN chairman Vincent Everts noted that companies will have to pay just to qualify for Software Assurance, because companies must be running the most current version of Windows or Office to get the maintenance agreement. "They are forced to buy this program [...] even though they don't want it, and that's what a lot of people are very angry about," Everts said.
Yes, Your Honor, here we have Microsoft demanding a revenue spike solely for
their own purposes and promising consequences if customers don't cough up on
schedule. This policy will of course be enforced through product bundling,
tight control of document formats, and the deliberate introduction of
incompatibilities of new products with existing ones. No significant
improvements in the way of products, services or functionality has been offered
to justify such inflated prices. Yet Microsoft insists that this new scheme
is intended to benefit users, that 80 percent of their customers won't pay
more than they used to (even in the face of simple calculations that show this
not to be true) and that they've come up with this extortion scheme in
response to demands from their customers. Excuse me?
Another good example of how Microsoft only wants to protect revenues rather
than serve their customers is the licensing technology that will be
incorporated in all new products, starting with Office XP. The software
license is tied to the PC's hardware, which is identified through the unique
characteristics of ten hardware components, e.g. the MAC address of the
network interface and the serial numbers of IDE harddisks. Licenses need to be
'activated' (for which you have to contact Microsoft). Licenses automatically
become void (read: the software shuts down) after certain hardware
modifications. In other words, if you replace a malfunctioning network card or
hard disk you have to to contact Microsoft and kindly request that they
'reactivate' your license so that you may continue with your work. The license
verification code also contains bugs that may result in Office suddenly
shutting down and asking for an original CD for re-activation, which
essentially leaves you without a functioning set of Office applications. How's
that for enhanced productivity?
Microsoft doesn't care where you want to go today. You'll go wherever Microsoft tells you to go, period.
Comments? E-mail me!