A week or so ago I read this interesting article about Microsoft Office and VBA (Visual Basic for Applications) which makes some interesting points about the windows "monoculture" in business and, in particular, about what it is that causes enterprises to not migrate away from a microsoft platform:
The final reason VBA isn't going away comes from the irony of the Windows monoculture of many firms, that - because everyone has to use the same collection of software, configured much the same way - the corporate configuration has to be capable of running less mainstream applications that are important somewhere in the firm.
So, although most users of Office do not code VBA, and a large percentage don't even use VBA code written for them, enough use is made somewhere that they must have the facility. Think of VBA as like the ladies toilets in a firm where 99% of the staff is male.
This is one of those somewhat hidden but classic "barriers to entry" that high tech VCs and entrepreneurs love and it's tied to the well known fact that people prefer sticking with the devil they know even though they gripe like crazy at the shortcomings. This is not just a high-tech fact, the same trick is exploited by banks and others, such as utility companies, to keep fleecing punters even though the punters could move to an alternative supplier who charged slightly less for the service. We (and I'm certainly guilty of this here and there) could move but we've built up a relationship with our supplier, we've learned how to use the product, how to pay, how to complain when something outrageously bad happens and so on. Switching to a new supplier is a major upheaval and frequently it is hard to justify the time we will take to adjust given the comparatively slow return on the investment.
However the beneficiary of this reluctance to change is liable to see his market disappear pronto as soon as a viable alternative arrives which is sufficiently cheaper/better that it becomes obvious that it is worth changing. A great example that Microsoft would do well to study is the music industry. A decade ago it was hard to get music from other than respected suppliers. Yes CD burners, rippers and MP3 players were there (but all pretty new) and Napster had yet to be formed to facilitate an alternative delivery scheme. If the Music Publishers had read the realeaves correctly they could have strangled the market at birth by embracing some of the techniques (CD burning on demand for example) and cutting prices. I believe one reason why filesharing took off was that once we could buy our own blank CDs it was obvious that the raw cost of a CD was (well) under a dollar so it seemed pretty insulting to be charged $14.95 plus tax for said CD when it had music on it. However as we know the music industry attempted to stem the tide by means of lawsuits and the like and still haven't cut prices much, even iTunes has not drastically reduced the cost per track, its just allowed us to remove the 80% of crap tracks that we were otherwise forced to buy too.
If you look at the price of Microsoft Operating Systems and Office Applications you get to see that Microsoft is reacting to Linux is the same way. When not sold with a new PC, a non-upgrade XP Professional sells in the US for over $250. Vista Home starts at $123 and Ultimate goes for a stonking $399 if you download it from Microsoft - it is actually cheaper to buy it as a physical product. Office Professional is similar ($329.95 if downloaded, $261.99 for the cheapest box). Now obviously these are essentially list prices and we all know that only suckers pay list. If you buy the products ready installed on your new PC, you can find a way to become a student or if you are a company who can afford a site license then the price drops but it doesn't seem to drop much below $100 for the OS (if we assume that professional people don't want Vista Home Basic) and $75 for Office 2007. I just bought an Asus Eee - price $349 at Amazon - and if I were to put Microsoft software on that legally then I'd be out anywhere from another $200 (upgrades, mumble mumble) to $600.
Given that for those of us with an ADSL line (or other broadband connection) ISOs of Ubuntu and other flavours of Linux can be downloaded in maybe a quarter of an hour and that these isos are free (less the $0.10 or so cost of the CD) and given that you can get a very decent PC for under $500 (ignoring the eee for the moment and the OS) then it seems silly to add $200 or so for Office, Windows XP etc.
So far Microsoft has remained relatively healthy because of the enterprise monoculture and the resistance to change. If, as I suspect, we are coming to a time of recession then people will be looking to shave expenses and it may well be that one expense enterprises decide to shave is the cost of more Microsoft licenses. After all, for all except a few awkward macros, Open Office works just as well and is quick to adapt to and, especially if a Corporate IT department does the installation, so is Linux these days. If Open Office and Linuc result in savings $100-$200/ year/ employee then the pressure to change starts looking irresistble when profits are under pressure (after all at $100/ year /employee a 10,000 person enterprise is saving a cool $1 million a year).
As soon as someone comes up with a relatively painless way to migrate VBA macros and scripts to Open Office using something like python, and as soon as some one comes up with a thunderbird plugin that handles outlook calendars (and both of these are things that are being worked on to some extent) then the logjam is going to break. The fact that people hate Vista and that Office 2007 is already dangerously incomaptible with earlier office versions merely means adds impetous to IT departments looking for a non Microsoft alternative.
Blog Home : January 2008 : Permalink