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Reader’s Take on Microsoft’s, Open Source Strategy

Posted in Free/Libre Software, GNU/Linux, Interview, Microsoft, Novell at 12:25 am by Dr. Roy Schestowitz

As further analysis of the Bill Hilf interview SundayRefugee submits:

From the Bill Hilf interview:

“That’s why when we do these partnerships we want to use, we want to partner with the people who are distributing the product that customers use…”

He nearly says ‘we want to use these distributors (of Linux)’, catches himself, and has to quickly rephrase it.

“We published a patent map, which shows, literally, we listed out every number and we listed out every category it fits in and we published that so everyone can see it, because everybody kept asking us, well, what are the patents? (Note: a Microsoft spokesman later clarified Hilf was referring to a categorized tally of possibly infringed patents published earlier this year in a Fortune article, not a detailed list of every specific patent, which Microsoft declined to provide to InformationWeek.)”

”…they’ve been purposefully vague in the hopes of scaring potential customers.“Of course they’ve done no such thing – they’ve been purposefully vague in the hopes of scaring potential customers. Either Microsoft’s “biggest brain” on Open Source A) is dramatically misinformed and utterly clueless about even the essential goings-on in even his own company, let alone the complicated Open Source landscape, or B) purposefully lying, with the only intent on FUDing Open Source and Linux, in the hopes he somehow won’t have his bluff called.

Thought you might want to catch that. There are several other great quoteworthy statements, but those are the two biggest that caught my eye. I wrote my replies as if I were addressing he average ‘boycott’ user.

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A Single Comment

  1. SubSonica said,

    November 17, 2007 at 8:19 pm


    I jus saw a couple of comments on Groklaw telling how Microsoft will fall:

    It sounds like Microsoft is having to play catch-up with Linux. At one time, everyone assumed that Microsoft would lead, and the rest of the industry would continue to follow. It’s not like that anymore. The world is passing them by, just like IBM when their mainframe leadership ceased to matter very much any more. Microsoft though doesn’t have the diversity and business depth that would let them adapt like IBM did.

    People in the technical end of the business realise this already. When that idea starts to filter over to the financial people, then it will have a serious blow to their stock price/earnings multiple. Microsoft’s main asset isn’t their software. Their main asset is the myth that they are indispensable.

    If their stock price falls, then Microsoft would look like a very inviting target for the financial piranhas. It would be a deal-maker’s dream come true. They would make a very nice take-over target. One of the really inviting targets is the pile of cash and short term investments they have. That would be the first thing to go – use it to pay off some of the loans used to finance the take over. The new owners could than make the company take on the rest of the loans used to take them over. They would give them a heavy debt, but they would have the cash flow to service it.

    There’s lots of things that can be done to cut costs to service the debt. Sell off the XBox division to one of the Korean or Taiwanese electronics companies. Close down Windows CE. Sell off the MSN/hotmail/web division to a media company. Shut down all the other money losing ventures (just about all the smaller divisions).

    That would just leave Windows and Office. Those are the businesses that pump out cash. More cash can definitely be squeezed out of those, at least for the short term. There’s lots of dead wood that could be laid off without affecting revenue. Prices could easily be raised, by at least 50%. The customers would pay. They’d have to pay, as too many of them can’t switch to something else too easily.

    When the short term profits start to look better, the Windows and Office divisions could be floated separately on the stock market to make them “pure play” investments. Investors generally pay a premium for pure plays versus conglomerates (which is what Microsoft is now). The take-over investors would sell out with a massive profit. It would be the biggest business deal ever.

    Eventually, under the continuous rounds of cost-cutting lay-offs, falling market share, and irreversible decline, Microsoft would end up like SCO. And no doubt, at that point some IP troll would buy up the remains in order to sue all the healthy businesses.


    all of this makes a great deal of sense.
    Microsoft’s stock price has been stagnant for years. It has a large cash
    reserve. The only thing keeping it from being a very tempting takeover target
    is the killer question, does anyone own enough shares to stop such a takeover?

    The description of “after the takeover” is absolutely typical of the
    aftereffects of any hostile LBO. Use the surplus to pay down the debt incurred
    in the buyout; sell off the underperforming divisions, slash staff in the
    remaining divisions, and watch the $ roll in… until the market changes and the
    company, now unable to adapt because it hasn’t got the R&D anymore, becomes
    piranha bait.

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