Wednesday, June 11, 2008

Microsoft and New Media. Port25.

There is a growing belief that the Internet is a more interesting place than the PC and that the next generation of software will be developed on the Internet. Such work is furthered by the Open Source Initiative, which encourages the sharing and contributions of the wide audience on the Internet. Open Source software strikes at the essence of Microsoft, the value add it gives to the environment is offered for free by open source.

Microsoft must address the emergent open source software. The most important publics are not only the open source community, but equally government and large corporate customers. Social media can give Microsoft both feedback information as well as voice for its open source related messages. Port25 is a Microsoft blog for interactive communications about open source.

Naturally, Microsoft puts a positive spin on the Port25 mission. “Port 25 is about having a healthy conversation with customers and the industry wherein people can talk openly and honestly about their biggest interoperability challenges, whether it is on UNIX, Linux, Windows, or among other open source packages.” The pillar posts for the blog were published in March 2006 and stressed the interoperability theme. A prime example is at http://port25.technet.com/archive/2006/03/31/Faces-from-the-Collective_3A00_-Shared-memory-anyone_3F00_.aspx and is a video interview with a noted Open Source guru who had been hired by Microsoft.


The site seems to be in decline. Over the past two months, only seventeen posts have been made. Here is an IceRocket trend graph:



My conclusion in reading the Port25 postings and responses is that Microsoft is trying to send an interoperability message to the three publics I mentioned above. Only the Open Source technical public is commenting. This is no interactive communication with strategic buyers. Top Microsoft management should engage in this blog to expand the scope of interactive communications to also capture strategic buyer interest.


To read a more complete analysis, see Redmond Review Port25.

4 comments:

Unfrozen Cave Girl Marketer said...

Thanks for the overview of the advantages of Open Source. Your paper is a great resource.

I find that, at my company, many of our software engineers have been educated on Microsoft software and are not comfortable developing on Open Source.

Similarly, company management is not certain how to make money selling software with Open Source licensing terms. Any thoughts about that?

George said...

Typically, Open Source companies make money in support, which includes operations and maintenance, not on the front-end.

The support cost includes, according to Microsoft, the greater development effort, and also greater administration cost because of less sophisticated admin tools in open source.

Microsoft is adapting and in China has a near zero purchase cost, but is relying on O&M, the cost for maintenance support contracts. They were able to wrest the desktop from Red Flag Linux to Windows.

Another approach to Open Source is Software as a Service. Google Docs is an example. There is a potential for ad revenue to pay for the software in this revenue model. Hence, Microsoft's interest in Yahoo!.

Unfrozen Cave Girl Marketer said...

Thanks for the response!
I hate to be such a cave girl, but I don't really understand what sort of revenue would come from Operations and Maintenance. Would this be like selling an end user a seat of licensed software, and then charging them for customizations for the software? Or perhaps for help desk?
I really appreciate the help, the business model is is something I would like to be wrap my unfrozen kepe around.

George said...

Operations and maintenance would include contracting for what Microsoft calls Product Support Services. IBM and others provide it for Linux and open source generally. PSS is on call to help organizations resolve problems with the software. O&M often also includes consulting support - experts in the software on hand to help in decision making about future directions.

Other support besides O&M, would include training and also consulting. Many large organizations hire Microsoft Consulting Services or a Microsoft Partner to assist them with migrations to new versions, installation of new software, reconfigurations and the like.

It should be noted that these are all optional fees. Gartner is predicting that Microsoft will eventually give its software away free, like Open Source, and make its money in the optional support fees, as well as with software as a service and ad fees. Here is the Gartner article, Fiering, Leslie, et al (December 20, 2007). Predicts 2008: Changes in What End Users Will Buy and How They Will Pay for It. Gartner, id# G00153163.