If you live in the San Francisco Bay Area long enough, your view of the world gets a little warped. "Hot weather" is anything above 75 degrees, "rain" is a four-letter word, and the East Coast might as well be a part of the European Union.
If you live in the San Francisco Bay Area long enough, your view of the world gets a little warped. “Hot weather” is anything above 75 degrees, “rain” is a four-letter word, and the East Coast might as well be a part of the European Union.
Even newspapers here tend to skew your perspective. In recent weeks, Microsoft’s settlement was front page news, and if I’m not mistaken (there’s that perspective thing again), Microsoft garnered a bigger headline than the Giants’ wins and losses in the World Series. (But, of course. After all, everyone in the Bay Area works in the computer industry.)
But the news about Microsoft and the company’s anti-trust settlement being approved was hardly worth all of that ink. While the anti-trust case might have been important when it started, it’s mostly irrelevant now. Business happened, mergers happened, and the Old Economy slowly and patiently outlasted the New Economy, smartly integrating what worked on the Internet, and discarding everything else.
Moreover, today, Microsoft, like Sun, HP/Compaq, AOL, and Oracle, is faced with the challenge of reinventing itself, innovating new products, and pursuing new lines of business.
But, wait. Don’t gloat. Read that last sentence again. All of the companies listed above, not just Microsoft, are faced with a down economy, and as far as I can tell, no breakthrough, killer app to drive throngs of customers to their door. And that’s not a good thing. Why, it seems like the early ’90s again. We’re on a plateau, with no spike in sight, and the burning question is: where willb growth come from?
Believe it or not, I found the answer in this morning’s Wall Street Journal. There, in the “Marketplace” section, were two, bright-yellow, full page ads from Sun. The message? Here’s a complete server solution for $995.00.
Sure, Sun has computers that cost tens, even hundreds of thousands of dollars. But you can only sell so many of those. A server for $995.00? That’s small change, even for a young company just getting started. I’ll take five.
In fact, Sun’s ads echoed an earlier product announcement from Dell and its 1600SC server: $999.00 for a machine with hardware specs that seem like something that should cost nearly twice that.
If you ask me, the low-end is where the growth is. For the industry, and for Linux. With hardware such as Dell’s, and even a modest knowledge of Linux, a small- or medium-sized company can build an effective infrastructure for a paltry investment.
Sure, the 1600SC isn’t a big-ticket item. In fact, it’s the opposite: it’s a commodity. But, when you sell commodities, what you lose in margin, you gain in volume. That’s worked for desktop PCs, and that’s certainly Dell’s game plan with the 1600SC, and Sun’s plan with its Sun Fire.
As we enter 2003, Linux seems well-positioned as the perfect complement to commodity-priced servers. Linux is a robust competitive operating system, and as you’ll read in the “Future of Linux” feature on page 14, the Linux 2.6 kernel promises to expand the feature set even more — from small systems to “big iron.”
Given commodity-priced desktops, commodity-priced servers, and an unbeatable license (not to mention gobs of Open Source software), Linux systems are priced to move.
Martin Streicher, Editor
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