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08.09.13

More OEMs Turn to Linux-based Platforms Because Dependence on Windows is Killing Them

Posted in GNU/Linux, Google, Steve Ballmer, Windows at 12:15 pm by Dr. Roy Schestowitz

Worn out and defeated

Killing ground

Summary: Acer is the latest large company to officially move away from Microsoft Windows because no OEM — not even Microsoft with its “Surface” disaster — can sell hardware with shoddy software preinstalled

Some new numbers suggest stagnation in the target market of Microsoft, which led Acer, one of the largest OEMs Microsoft works with (see this old Microsoft OEM agreement with Acer), to losses and subsequent exploration of Linux-based alternatives. As Microsoft booster Nancy Gohring put it, citing he employer’s numbers (IDG citing IDC without disclosure again), “Acer the latest to turn to Google after poor Windows sales”:

Acer, the electronics maker that once seemed to be a big Windows 8 booster, is turning its back on Microsoft.

After posting a second quarter loss this week, it said it’s going to aggressively work on selling more Chromebooks and Android devices. According to the Wall Street Journal, Acer’s chairman said he hopes to grow revenue from Google smartphones, tablets and Chromebooks to 10 percent to 12 percent of revenue by the end of this year and to as much as 30 percent next year. He apparently didn’t say exactly how much revenue comes from Google software today, but said Chromebooks made up nearly 3 percent of shipments in the second quarter, according to the Wall Street Journal.

Acer is the latest vendor to shift its weight toward Google products and away from Microsoft. HP and Lenovo, long-time hardware partners of Microsoft, have also started making Chromebooks.

Mr. Pogson says that Acer had been squeezed by Microsoft and it is not the first. As he notes in this earlier post:

When a monopolist pushes an OS at a price above the market on OEMs, they suffer. While the monopolist gets a huge cash-flow, the OEM works for nothing, just a tiny margin. While OEMs take a commission on the price of that other OS, they sell their hardware for next to nothing. OEMs are manufacturers, not salesmen for M$. Do framers work for $0 per hour plus a penny per nail? No.

Christine Hall, another GNU/Linux proponent, says that “The consensus on [Windows] RT is that it’s something of a toy operating system. Some say it’s done nothing but weaken the Windows on tablet brand–as if that’s possible. The smart money crowd is expecting Microsoft to give-up on RT sooner rather than later. Almost everybody says RT isn’t long for this world.”

Microsoft has got nothing that can truly challenge Linux-based operating systems and one GNU/Linux proponent proclaims that “Microsoft Surface is Doomed, Steve Ballmer Should Be Fired” (others say the same after the Surface oversupply fiasco [1, 2, 3]).

Firing Ballmer would not save Microsoft. But it would be a face-saving move, that’s for sure.

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