Fw: Microsoft warns of open source threat

[Randy Melder]

They are probably "sand-bagging" for what would have been a
lower-than-expected earnings quarter.

; ) .randy

 Randy Melder
 Cheery Lynn Interactive, LLC
 602-279-0135 - www.cheerylynn.com
=20


-----Original Message-----
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[mailto:plug-discuss-admin@lists.plug.phoenix.az.us] On Behalf Of =
technomage
Sent: Sunday, February 16, 2003 12:19 PM
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Subject: Fwd: Fw: Microsoft warns of open source threat


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just thought you guys would want to see this...


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Subject: Fw: Microsoft warns of open source threat
Date: Sun, 16 Feb 2003 08:59:04 -0500
From: David Poehlman <poehlman1@comcast.net>
To: blinux list <blinux-list@redhat.com>

Microsoft warns of open source threat
By
Ian Fried
Special to ZDNet News
February 5, 2003, 4:34 AM PT
URL:
http://zdnet.com.com/2100-1104-983398.html

Microsoft is warning that the success of the open-source movement could =
hurt
its sales, potentially forcing the software giant to cut prices and
sacrifice both revenue and profits.

"To the extent the open-source model gains increasing market acceptance,
sales of the company's products may decline, the company may have to =
reduce
the prices it charges for its products, and revenues and operating =
margins
may consequently decline," Microsoft said in a filing last week with the
Securities and Exchange Commission.

In the filing, the Redmond, Wash.-based company paints a picture of two
contrasting business models--its commercial software development model, =
in
which a single company bears the costs of developing software and reaps =
the
financial benefits of the work; and the open-source model, in which, =
says
Microsoft, "software is produced by global 'communities' of programmers, =
and
the resulting software and the intellectual property contained therein =
is
licensed to end users at little or no cost."

A Microsoft representative was not immediately available for comment.

Companies often include cautionary language in their regulatory filings
about potential risk factors. Other threats listed by Microsoft include
potential litigation, the fact that many of the company's newer products =
are
unprofitable, and "General Economic and Geo-Political Risks."

However, Microsoft has long criticized the economic underpinnings of the
open-source movement.

In the regulatory filing, Microsoft specifically calls out the threat =
that
some government agencies may switch to open-source software. South =
Africa is
promoting the concept, and Germany is paying companies to build =
equivalents
to Microsoft's Outlook e-mail software and Exchange communications =
software.

The pressure from the open-source movement is not just financial, as the
availability of open-source software puts pressure on Microsoft to open =
up
the code that underlies its own products.

The company has already agreed to open its usually secret source code to =
the
British government.

News.com's Stephen Shankland contributed to this report.




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