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I agree that this article offers nothing.  Linux shows no sign of gaming any consumer ground because it offers consumers essentially nothing.  Linux UI's have and continue to be blatant and shoddy rip-offs of Windows and OSX.  The average consumer must look at Linux (for the few that even know what it is or have ever seen it in operation), and think "what's this, a cheap Windows rip-off?".  Yep, it is.  Desktop Linux is to Windows as "A-Treat Cola" is to Coke.

The article flirts with a point though, which is that in the world of "ultra low cost PCs", Microsoft's traditional software licensing costs, which haven't felt pricing pressure in 20 years thanks to Microsoft's monopoly position, are now going to feel downward pressure.  These lower margins, as volumes rise, could put a drag on Microsoft's bottom line in the same way that the PC makers have been commoditized.  OS software in a cloud world does become more and more of a commodity, especially on systems too slow to run sophisticated rich client apps.

Perhaps Microsoft is willing to chase this market in an effort to head off linux at the pass.  Given how paranoid MS is, I think that's a reasonable thought.  But that's why they're doing it.  Because they're paranoid.  Not because Linux is winning in the consumer marketplace.  Because it's clearly not, just as Paul repeatedly points out.

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Aside from the obvious point that Apple only (legally) allows OS X to run on its own hardware, would the inability for Leopard to run on these machines indicate a "fiasco" as well???

I think posting this graph repeatedly is unnecessary, propagates the OS holy wars and ignores the clear momentum the Mac has in the US, particularly with the college students who will be running corporate networks in five or ten years.  

That being said, I agree that Microsoft keeping XP for slow, cheap machines has absolutely ZERO hidden, super-secret meaning.  It's funny that the author mentions $200 as being "magic number for broad consumer acceptance."  So, PCs haven't been broadly accepted by consumers?  If people buy low cost computers in large numbers, they're generally second or third machines.  I don't see them affecting regular PC sales much, if at all.

What Microsoft should do is disable a bunch of unnecessary features and services on "low-cost" XP so it'll run even faster on these slow machines.  Even setting the old Windows standard interface as the default makes a big difference in running XP on slow hardware.  I realize there are hobbled versions of XP for other markets, but I'm thinking of a full version with features consumers don't widely use (NetBIOS, UPNP, Server service, etc.) turned off by default.  

There are still many companies that do not need to upgrade or just can't because of old software and/or expense. MS must understand this and does not want to leave them without ability to replace old or broken units. That's pretty decent of them if you ask me. Besides, there is still some profit to be made.

You already knew it Paul...heck we even called in the comments in your original post about the story. Its just so predictable.

I actually think that the use of this graph is fair in this story's context.  Apple doesn't play in this cheapo market given that the $599 mini is the cheapest mac sold.  On the other hand this market for XP is precisely the one that's irrelevant to the Mac and most consumers.  This is the corporate drone PC/point-of-sale/vertical market.  The real question is, what is Microsoft's licensing fee for XP in these instances?

I think if Paul were a German General on the Russian Front in the summer of 1942, he would be telling his troops how great things were going.  In reality big problems were lurking just around the corner.

The Asus EeePC is flying off the shelves and consumer acceptance seems to be very high.  As far at the UI goes: Linux copies from Apple and Windows, Windows copies from Apple, Apple copies from Windows and it seems that in Leopard, Apple has copied the "Spaces" concept from Linux.  The other thing is that UI design is moving in a certain direction and all 3 are making use of it.

I am not sure how the 1% Linux marketshare was arrived at -sniffer programs?  units with Linux preloaded?  What I can tell you is that lots of people are having a look at Linux and you can do this easily with a Live CD.  We actually got a letter from our ISP requesting customers to download Linux distros during off-peak times for bandwidth reasons.  Some people are loading Linux on their parents machines and for the part of the market that DRWAM likes to talk about - that only wants a computer to do WP, email and Web Browsing - something like Ubuntu is pretty much ideal.

Windows fanboys like to talk price a lot and here Linux wins hands down.  So the ULCPC is very attractive on this front and as I mentioned the Asus EeePC has been well reviewed here and elsewhere.  

From The Guardian:

It seems that the £200 ultraportable Asus Eee PC can do no wrong. The size of a paperback, weighing less than a kilogram, with built-in Wi-Fi and using Flash memory instead of a hard drive for storage, the Eee PC has been winning positive comments not just from hyperventilating hardware reviewers, but also from ordinary people who have actually bought it.

According to an (admittedly biased, because it was self-selecting) online survey of 1,000 users on the independent Eee PC site eeeuser.com, around 4% were dissatisfied with their purchase, 33% found the system pretty much what they expected and 62% thought it was even better than they had hoped.

Looking through the thousands of postings in eeeuser.com's user forums, the same comments keep coming up: it's so small, the build quality is high, it boots up quickly, it just works. In fact, it's hard to find many negative points. Most are about the placing of the right-hand shift key, the small size of the keyboard, the limited battery life and the slightly awkward mousepad. One thing that is almost never mentioned as a problem is the fact that the Eee PC is running not Windows, but a variant of GNU/Linux.

Until now, the received wisdom has been that GNU/Linux will never take off with general users because it's too complicated. One of the signal achievements of the Asus Eee PC is that it has come up with a front end that hides the richness of the underlying GNU/Linux. It divides programs up into a few basic categories - Internet, Work, Learn, Play - and then provides large, self-explanatory icons for the main programs within each group. The result is that anyone can use the system without training or even handholding.

www.guardian.co.uk/.../opensource.olpc

What is a lot more dangerous for Microsoft is the threat from Government and Business adopting Linux.  The attraction of FOSS for markets in Asia, South America and Africa is pretty strong not only because of price but it allows for localisation and the development of a home grown IT industry.  In Europe their is a strong attraction too and the Conservative Leader (and probably next Prime Minister) in the UK has just come out strongly for Open Source for government.  

www.channelregister.co.uk/.../conservative_open_source

The Mac gets a lot of spillover sales from the iPod and iPhone and Windows gets it from people using it at the office.  Once people start using Firefox and Open Office and find they can get along just fine with it - that is the point that Microsoft is in trouble.  Bill Gates has often said that the support for Windows was a mile wide and an inch thing (or words to that effect).

Linux certainly has the potential to hit Microsoft hard both at home and the office.  Whether that becomes a reality or not depends on how Microsoft manages the situation.  Vista has not helped it.  Microsoft cannot be complacent.  They are no longer the only option.

Again, we're just talking about computers and hardware people. Noone has slapped your mother.

XP has been out for I think 7 years....companies are complaining that can't upgrade today to Vista?  Uh, to me most companies keep pcs 3 years than refresh with new hardware. So this constant argument of not keeping up with the hardware is b.s.  If a company does not have the budget for new hardware, ok...keep on XP. NO one is putting a gun to your heard and telling you to upgrade.  Heck, I still see companies with Win2K on their desktop.  Again, no one putting a gun to their head.

People have to remember, again: this is not a religion, no one just slapped your mother.

Go outside, get some sun.

Two more things, use what is best for you. And, I'm really tired of how popular it is to keep bashing Vista.  Vista runs fine.

Oh wait, I can load Vista on an old Dell I have, it's PIII 750Mhz, 133Mhz ram, 512meg ram, onboard video from back then, and let me *** up a storm all over the internet how Vista sucks!  

I really want to know the truth who these people are that keep posting comments on Zdnet articles are. I truly belives they're just a bunch of Linux geek kids in their mother's basement with no real world corporate expierence.

This guy is a "storage expert" and a big time ABMer.  So what’s his plan, have the least computer literate people buy the cheapest pcs running linux? Sure that’ll work.  Not!

Paul,

I've been reading this site of yours, WinInfo almost since it's inception (and now this blog). How long is that? No...wait...I don't know. And as a loooong time faithful reader I respectively give you a heads up.

The *professionals* at ZDnet who write the articles you're referring to *are not* part of the "blogging crowd". They are professionals, many who have been writing these types of articles long before ZDnet switched over to a blogging platform for posting these types of articles.

No, I'm not part of ZDnet, I'm one of them (old) bloggers. Point here is that you need to tell it like it is when you write out your titles. It wasn't the "blogging crowd" who put out that info...it was the staff at ZDnet. It doesn't matter if thay call them blogs, it's the same old ZDnet stuff.

Wow, I called it!

community.winsupersite.com/.../microsoft-announces-extended-availability-of-windows-xp-home-for-ulcpcs.aspx

@ Delmont

I am not a big Linux fan but it is helpful to remember that over 3,700 people have been engaged in developing the Linux kernel and 74% of these have been doing it for their corporations which include IBM, Novell, Intel and Red Hat.  Only 13% of them have been amateur hobbyists.  It is probably the largest cooperative venture in computing and it is impressive much in the way that Vista and OS X are impressive too.

OS X runs on mobile phones. It's a modified version, you say? Well, surely Microsoft can modify their products into new versions - the incredible amount of different versions of Vista should prove it. But no: Vista in all its incarnations and 14 months after its release is still too heavy to run on all new computers, so nearly a decade-old piece of software is replacing it. Is this a joke?

"Vista in all its incarnations and 14 months after its release is still too heavy to run on all new computers"

"new computers", meaning in this case: a system that was just recently built and purchased, but containing 3-4 year old technology (or in the case of the Eee PC, 8-year old technology).  I guess that's true then.  For all the regular consumers not fitting into that ultra-budget market, Vista runs just fine on REAL new computers featuring Intel Core 2 processors and 2GB of RAM, as is what is standard in any mainstream system now.

"Vista runs just fine on REAL new computers featuring Intel Core 2 processors and 2GB of RAM, as is what is standard in any mainstream system now."

But all consumers no longer want to buy a standard mainstream system. Be it 8-year old technology, Eee Pc is still new when you buy it new. XP is 7 years old even if you buy it today. That's where people start looking elsewhere, because MS offers them nothing.

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