Hype Aside - Company Business and Marketing

ENT, August 16, 2000 by Al Gillen

I sometimes wonder if hype, exaggeration, and manipulated statistics existed before the computer industry Certainly it did, but I'll bet the computer industry can be credited with elevating the use of hype and the manipulation of data to new extremes.

A day doesn't go by that some vendor doesn't announce that its latest and greatest widgetware -- insert what you like: hardware, operating system, database, transaction processor, Web server, print and file service -- offers an x-percent improvement over its old product, beats the competition by a factor of 10 to 30 times, has a lower cost of ownership, and will even make the morning coffee if you buy the optional coffee maker accessory. This is something all companies are guilty of to some degree. Large vendors have the public relations machines to disseminate a biased message worldwide in a matter of hours, and the up-and-comers bend the rules more than established veterans because they can get away with it.

Microsoft cannot claim innocence when it comes to making pie-in-the-sky promises. The company has been known to make preannouncements that precede products by years, to conveniently forget unpleasant historical events, and to trumpet cost of ownership because it told a story that couldn't be discredited the way a claim of pure performance or reliability could be. Although successful at manipulating the media over the years, Microsoft now finds itself under attack by Linux vendors and the Linux trade press. Some in the Linux community are willing to fling any numbers around to bolster an agenda -- much like the PC industry did in its early days.

I recently attended an industry trade show where a vendor that plays in the Linux space flashed a bunch of bar graphs on an overhead screen before several hundred people showing the enormous growth prospects for Linux and how it would quickly catch better-established platforms in the industry. This followed another prediction by another Linux presenter that picked a future date for when Microsoft would near bankruptcy. The audience, made up of the Linux faithful, ate up this rhetoric -- similar to the attendees at a Microsoft event eating up Microsoft's projections for future success. This, by the way, is not to say that Linux doesn't have a rosy future; in fact, I've published research that paints a very bright future for Linux.

But a look at the big picture suggests that Linux is just as unlikely to unseat Microsoft from its current position as Microsoft is to crush Linux into oblivion. Microsoft has won the desktop battle. For Linux to come in and replace huge numhers of Microsoft desktop systems -- as we know them today -- is unlikely Had Microsoft nor finally come out with a product that is more reliable, the potential for a major revolt in the user base could have existed.

Where Linux and Microsoft will likely enter into a grueling battle is for next generation systems. I don't mean aboard 64-bit Intel Architecture servers and workstations. I mean the battle to be waged in the embedded space -- embedded servers and embedded client devices. On the client side, there is an avalanche of hand-held and otherwise mobile devices that are opening huge new markets. If Microsoft fails with Windows CE 3.0 and the .NET initiative to build a customer base in this market, it could signal long-term trouble for the company on the server side.

Microsoft is gearing up for this challenge. Through the next 12 months, Redmond will round out its set of embedded technologies to include a Windows 2000 server product specifically designed for building appliance servers. Pricing is a tricky issue -- that will continue to haunt Microsoft, something the Linux community will stick to Redmond on every occasion possible.

About a year ago, I wrote a column about next-generation client devices causing a paradigm shift for server vendors. A reader took me to task for overusing the term "paradigm shift." I believed that was the right term then, and I believe it continues to be the best term to describe what's happening in the industry. What systems power these next-generation devices will be the next major battleground to watch. --Al Gillen is research manager for system software at IDC (www.idc.com) and former editor in chief of ENT. Contact him at agillen@idc.com.