Per, VERY interesting indeed! I'm not quite sure if it's good or bad news. On the one hand, MS acknowledges the threat to their profitability from Open Source, but they dno't mention ANY plans to DEAL with that threat. The fact that MS is looking into becoming an ASP is not terribly surprising. It seems like they'd have a better chance picking up traction there. However, I can imagine companies STILL wanting a local copy in the event of some sort of network outage.
Thanks for providing that excerpt. BTW, are there any companies/projects offering OO.org via an ASP? Sorry if that's some sort of common knowledge which I've missed. On 8/19/07, Per Eriksson <[EMAIL PROTECTED]> wrote: > > Hi there, > > This was an interesting piece of information that I came across when > reading the msft annual report 2006. > > > "RISK FACTORS > > Challenges to our business model may reduce our revenues and operating > margins. Our business model has been based upon customers paying a > fee to license software that we developed and distributed. Under this > license-based software model, software developers bear the costs of > converting original ideas into software products through investments in > research and development, offsetting these costs with the revenue > received from the distribution of their products. We believe the > license-based software model has had substantial benefits for users of > software, allowing them to rely on our expertise and the expertise of > other software developers that have powerful incentives to develop > innovative software that is useful, reliable, and compatible with other > software and hardware. In recent years certain "open source" software > business models have evolved into a growing challenge to our > license-based software model. Open source commonly refers to software > whose source code is subject to a license allowing it to be modified, > combined with other software and redistributed, subject to restrictions > set forth in the license. A number of commercial firms compete with us > using an open source business model by modifying and then distributing > open source software to end users at nominal cost and earning revenue on > complementary services and products. These firms do not have to bear the > full costs of research and development for the software. A prominent > example of open source software is the Linux operating system. While we > believe our products provide customers with significant advantages in > security and productivity, and generally have a lower total cost of > ownership than open source software, the popularization of the open > source software model continues to pose a significant challenge to our > business model, including continuing efforts by proponents of open > source software to convince governments worldwide to mandate the use of > open source software in their purchase and deployment of software > products. To the extent open source software gains increasing market > acceptance, sales of our products may decline, we may have to reduce the > prices we charge for our products, and revenue and operating margins may > consequently decline. > Another development is the software-as-a-service business model, by > which companies provide applications, data, and related services over > the Internet. Providers use primarily advertising or subscription-based > revenue models. Recent advances in computing and communications > technologies have made this model viable and enabled the rapid growth of > some of our competitors. We are devoting significant resources toward > developing our own software-as-a-service strategies. It is uncertain > whether these strategies will prove successful." > > Source: Microsoft Corporation Annual Report 2006, page 21 > > > _______________________________________________ > Best Regards > Per Eriksson > Marketing Contact Sweden > OpenOffice.org > Phone: +46 70 560 10 33 > Email: [EMAIL PROTECTED] > Web: http://sv.openoffice.org/ > > --------------------------------------------------------------------- > To unsubscribe, e-mail: [EMAIL PROTECTED] > For additional commands, e-mail: [EMAIL PROTECTED] > >
