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How Yahoo! Reduced Zimbra's Value From $350 Million to $100 Million and How Office Web Apps Excludes GNU/Linux Users


Paul Maritz
Photo by former Microsoft evangelist Robert Scoble



Summary: How Microsoft's Paul Maritz got hold of Zimbra very cheaply and how Microsoft uses its online office suite (as well as ties with Facebook) to exclude GNU/Linux users from accessing peers' documents

EARLIER this year we explained why VMware's acquisition of Zimbra has poor signs of commitment [1, 2]. For starters, VMware's parent company is helping Microsoft Exchange/Outlook, which is Zimbra's direct rival (Zimbra is often the 'missing piece' to OpenOffice.org users who need mail and calendaring). Having essentially hijacked Yahoo! (more executives are still abandoning, only to be replaced by former Microsoft staff) Microsoft saw Zimbra being passed from Yahoo! to the Microsoft executives who run VMware after EMC's intervention. How much did that cost VMware? Not much, based on the numbers which have just come out.



Yahoo (NSDQ: YHOO) made about $100 million on the sale of its Zimbra enterprise e-mail and communications platform to VMWare in January; the companies had declined to release financial terms when the sale was initially announced but in its just-filed 10-Q Yahoo says it recorded “net proceeds” of $100 million and a “pre-tax gain” of $66 million on the sale.


Companies need to realise that Microsoft is trouble. It's like a cult that induces assimilation or kills the product/company in question. Earlier this week we showed Microsoft taking more control of Facebook and its users/data, having given hundreds of millions of dollars to Facebook and formed personal relationships with its master. We found the following news worth passing around:

Facebook Adds A Former FTC Chairman To Its D.C. Team



With calls growing for the FTC to look into Facebook’s privacy practices, the social network has now enlisted a former FTC chairman to make its case.


This makes the FTC look like more of a farce with conflicting interests.

Earlier this week we mentioned how Facebook was helping Microsoft hold its users' personal data hostage (using Microsoft's online office suite), which is probably all that Microsoft has left now that its biggest cash cow (Office) suffers a decline, partly due to an exodus to Google, not just Free software like OpenOffice.org.

Watch how Microsoft suppresses the use of GNU/Linux using its Web-based office suite.

Linux users will need a Microsoft Office license to use Office Web Apps



[...]

Still, it seems to me that this licensing requirement will inhibit organisations from taking full advantage of what the Office Web Apps can do. The advantage of a web-based solution is that anyone can access it, both within an organisation, and beyond it if you choose to publish it on the Internet. I doubt there will be much enthusiasm for buying Office licenses for Linux users, though maybe the kind of organisation that has a full Microsoft-platform deployment does not have internal Linux users anyway.


If this is true (the source is eerily close to Microsoft), it can become grounds for more antitrust action. Microsoft wants to prevent people from sharing documents across the Internet unless all of them -- GNU/Linux users included -- pay Microsoft for permission. It's an abuse of the network effect.

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