Ballmer Blames Software Piracy on Spendy Hardware, or: What I'd Do with a Hundred Bucks

Cutting through the spin and getting to the roots of the piracy problem.

Before you continue with this article, first go read Mike Ricciuti's article about a recent appearance by Microsoft CEO Steve Ballmer. Once you've put your head back together after that nasty explosion, let's talk here about some things that Steve said.

First off, let's take a look at the things about which he is absolutely correct. Ballmer says, "Until government and situational factors reduce piracy... those people...don't pay". It may sound petulant to point out this fact, but I've been saying this same thing forever. Linux doesn't win due to cost in terms of cash money marvelous, as Windows is pirated everywhere. If we are to believe the BSA, one in four businesses pirate software. How does one then explain the popularity of Linux- and BSD-based distributions? It couldn't be because they're better, could it?

Maybe Ballmer's other quote from the same article can shed some light on the answer to that question, "The biggest problem we have right now is that people who should be paying for software aren't." I'd like to refactor that statement. What I think he meant to say was, "The biggest problem is that we have people not paying for software that they seem to really like."

I hail Microsoft's desire for a $100 computer, I really do. You can buy a lot of computer nowadays for a crisp hundred dollar bill. Let's go to eBay.... Ah, here's a solid little machine--an IBM Netvista 500MHz machine with 128MB of RAM and a 10GB hard drive. Maybe you want a little more? How about a Fujitsu 700MHz with 192MB of RAM?. System discounters in any good-size town have machines such as these waiting for a nice home. You can run a solid Linux desktop on either of these machines and be very happy.

Would the same be true of Windows? Maybe. You'd need a little more RAM, but if you're willing to put up with some thrashing, it should do. But wait, that XP license is non-transferable from user to user. So if you want to be legal, you need to get a copy of XP Home (OEM), which Froogle is showing at or around $100. So, you're up to $200 now. I could have another Linux machine for that!

The point I'm trying to make here is there is real value in machines that have been abandoned for being somehow inferior, and the best tool I know of for deriving value from "experienced" hardware is Linux. I'm currently running a variety of servers for my personal infrastructure. I have two 1U machines with 933MHz PIII processors, both with decent amounts of drive on them and 384MB of memory each. My big upgrade for them might be memory, but they're both running well as is. They're not doing much, mind you. They're simply doing file and print work on my home network and some Web serving, but they have been doing that steadily now for some four years or more--I can't remember when I bought them from CDC. I reloaded them both about two years ago with Fedora core and I keep them updated, but that's about it. Rock steady.

Before they use Linux, people often have the idea that computers are ambiguous, capricious or even malignant machines out to get them. Install Linux, however, and you get the same computer from day to day, which is why I like using it.

Chris DiBona is the Open Source Program Manager for Mountain View, California, based Google, Inc. These writings are the author's opinions and do not necessarily reflect those of his employer. Before joining Google, Chris was an editor/author for the popular on-line Web site Slashdot.org, and he is an internationally known advocate of open-source software and related methodologies. He co-edited the award winning essay compilation Open Sources and can be reached by way of his Web site.

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GROUPAMA caught in a $200m PIRACY case

Anonymous's picture

GROUPAMA (a large French insurer) was caught in a $200m PIRACY case where it used "bank secrecy" to ask Police not to investigate its computers...

The fun part of the story is that the (Paris) General Prosecuter found no infraction in this (illegal) agreement!

See the whole story on:

http://remoteanything.com/archives/groupama.pdf

Novell Responds

Anonymous's picture

I remember the $100 computer

O. K. Griffith's picture

For those of you who aren't old enough or did ot pa attention to hardware in those days, there was a $100 computer in the early 80's. the TIMEX Sinclair.

RE: I remember the $100 computer

Peter Strasiniuk's picture

This story i remember too. at the MIT they tried hard. an they came up with 127$ with LINUX. SURE. cu ps

I remember that one well. It

Anonymous's picture

I remember that one well. It was my first real computer. Unfortunately, my family was poor, and we could not afford the nice peripherals like a tape drive. That's cassette tape for you youngsters, and it could take half an hour or longer just to load a single program. Like I said though, I never had the cool peripherals so I had to manually program each application in BASIC before I could run it -- every time I started the computer. This was made more difficult because the Sinclair used a small membrane keyboard that was nearly impossible to type on. Needless to say, I didn't actually do much with that thing.

Ah... the memories. I really miss that thing now. I wonder, could embedded Linux run on it? That would be a really fun project.

Uh, Chris, about the applications . . .

Michael R's picture

$100 for the XP licence. Ok cool. Now I'll just get to work on my budget, since I'm thinking about money at the moment, um right. No financial software. Well I'll write a letter to Mom, who doesn't have a computer. Notepad? Think not. Well I'll just use this in my home business. Useful Microsoft software...uh, hmmm.

As it has been for years (decades?) the cost of hardware is dwarfed by the cost of software. Forget the $100 PC. In the Microsoft world you'll need over $1,000 of software to make the hardware useful.

Fixable in ten minutes.

Chris G's picture

No, piece of cake to sort if you are prepared to think laterally.

First, get a free version of linux, that can fit on one CD. I'd suggest ubuntu, but gnoppix or slackware would do. Download it from a cafe or work and burn it (or use Ubuntu's shipit site to get a free version posted to you). Don't try optimised distros such as Yoper or Mandrake unless you are using recent hardware. I think Ubuntu has as easy an install as the more commercial systems -- it is jsut not as pretty.

Go to a dumpster, your boss, or a second hand store and get a machine with a 586 or better and 10 gig HD and better, and a cdrom. Get a monitor, and scrounge a keyboard and mouse. Check with universities and corporations about getting stuff at the end of their upgrade cycle. Acquire an old laser printer -- mine is now 5 years old and the main cost is new toners.

Install system: generally you now have office. In ubuntu, connect to your friendly internet system (The adsl modem may cost more than your machine) and adjust to use universal then download gnucash: you have your accounting sorted out.

Outside of windows, software should be free unless specailized.

Depending on your local access to cheap stuff, $ 50 (Dumpster plus adsl or cable modem) to $ 300.

This may not work for laptops: the commercial distros ( I use SUSE) on laptops deal much better with the weird things inside them. If you need really specailised software you may have to pay for the best solution but that is a choice -- for instance I prefer Stata for statistics to R -- but with effort you can do almost everything at low or no cost.

Chris

Re: Ballmer Blames Software Piracy on Spendy Hardware, or: What

Anonymous's picture

You can get a "new" PC for $0 at the apartment complex I just moved out of.

Here's what I pulled out of the dumpster there in a 6 month period:
* 2 (that's two) Athalon 1200 based Compaq PCs with onboard video and network cards and RAM.
* 1 Athalon 800 based Gateway PC with 15 GB ultra 66 hard drive, network card, Nvidia 64MB video card, RAM.
* 1 Pentium II-400 based Gateway PC with 40 GB ultra 133 hard drive, network card, RAM.
* 1 Celeron 500 based white box PC with onboard video, network card, and 10 GB hard drive, RAM.
* Various monitors, including 2 19 inch Dell Ultrascan and a 17 inch NEC multiscan.

In all cases, the hardware was in fine working order. Also in all cases, when booted up, the reason that the former owner(s) had disposed of the machine(s) became clear: they were riddled with spyware, viruses, and malware to the extent that they were essentially unusable. Undoubtedly, they had received "expert" advice from a friend or salesperson with MS Windows expertise that they simply needed a more powerful machine to run their applications. Considered in this light, you can understand why hardware makers are reluctant to open the doors to a new paradigm involving alternatives like Linux: it could severely impact the "upgrade cycle".

Peter Yellman

Lucky you on both counts

Anonymous's picture

You are twice lucky.. the dumpsters around here yield only P100-p200's.
And when I tried to rescue a few with tiny linux distros, I got only grief and partitioning/ HD erors. Windows ""savvy"' for a decade, I trolled newsgroups for advice, better distros, etc.. PHHHTTT... LIke I really need an ftp install.. I need a relatively coherent cd based install !! Instead, I get something that makes 1990's era Taiwanese HSP modem driver software for Windows (surely the worst drivers ever written) look easy.. Finally I throw a cd of something called WINDERZ99 at these antiques.. push enter twice, and 10 minutes later I have a desktop. Christ, I feel so.. dirty.... Where was corel, peanut, knoppix, blah blah blah
Look, I have had it with the win platform, (pause while laptop locks up again) but those mythical 1200 MHZ 20G dumpster systems are not only better than the best I own, but better than the Pc's where I work!
Until there is a dummy-proof install for a P100 16M, with a 1G hard drive avail for Linux ( I wont even think of trying to snif at BSD) that can surf, email, word process and be loaded be the retired guy next door, Balmer wins, the dumpsters and landfills remain full of iron and linux remains a frustrating promise rather than a fact.

Now tell me again about the joys of an ftp install...

Re: Ballmer Blames Software Piracy on Spendy Hardware, or: What

Anonymous's picture

Upgrade cycle indeed! The irony of it is that Windows has historically fed the hardware industry by upping the system requirements with each successive release. Not to mention...a windows system will get progressively slower the longer you run it due to spyware, viruses, and just general bloat. Now Ballmer is complaining that you can't find a PC for a hundred bucks. Well if you run Windows, you're gonna need another hundred dollar PC in two years and another and another... Not to mention another copy of Windows in two years bundled with your new hardware....and another and another. Stop the madness! All of my machines come from the local thrift stores or police auctions. My primary machine costed me $30 and it runs Fedora Core 2 smootly. I've practically switched my whole family over to Linux, and it saves me a great deal of time when it comes to playing tech support for everyone.

Windows games

Anonymous's picture

Are all the shoot 'em up windows games based on video card performance only? In other words, would one of the shooter games benefit from clustered computing?

What the previous poster isn't realizing, is if clustered computing can help with the shooter games, imagine this alternate scenario: he gets home, sis is shopping at the mall, and mom and pop are still working. He pops in a clusterKnoppix cd in each of their computers, then boots up his computer, the master node. He now has a 4 computer openMosix cluster to play that game on.

I can see little Johnny now, on his bicycle, pedaling up and down the neighborhood looking at the neighbors' curbside trash for discarded computers to add to his cluster. And hiding them in the attic and under the bed and in the garage so mom doesn't see them all. Her only question being, why do you need a 24 port gigabit switch for again? And what are all these wires? And then the lights and tv going dim every time lil Johnny closes himself off in his room.

Would a 5-10 computer openMosix cluster running vmware or wine or whatever emulation outperform a single windows computer running the same game?

Re: Windows games

Anonymous's picture

Aside form teh issues with emulation. All shooter games are Video card intense at the user end. In most case you get a bigger edge in game pla with bigger vid cards than you do from bigger CPUs.

Re: Windows games

Anonymous's picture

Nope... Not inherintly multithreaded, so, with only one thread, it will probably run on the most powerfull system - usually your best one and the rest will do nothing...

On the other hand multi user systems would benefit from a mosix style cluster. That 4 user hp system - put in a couple of labs worth of them in a school and make them all part of the cluster. Then if some student is running a really big app, the other users on the machine will have their processes migrated to lower loaded systems...

Anyway... I don't have a clue how to implement this, but I'm sure there is a howto somewhere on it.

OSIA's response to Ballmer

Anonymous's picture

Ballmer Agrees With OSIA: Microsoft Software Too Expensive

Australia -- 20th October, 2004

Microsoft CEO Steve Ballmer recently declared that a $100 PC was needed
to combat piracy in the emerging economies. Ballmer was quoted as
stating that "There has to be...a $100 computer to go down-market in
some of these countries. We have to engineer (PCs) to be lighter and
cheaper." [1]

OSIA agrees with Microsoft on this point. However, hardware prices have
already dropped rapidly in recent years due to fierce competition. The
biggest single cost remaining in new PCs is the software which it needs
to run to do anything useful; an operating system and an office
productivity suite. And here lies the problem.

Microsoft Windows & Office XP combined, retail for almost US$1000, which
could equate to many months of wages for consumers in emerging economic
regions like Africa and Southern and South-Eastern Asia. This cost is
300% more than the cost of the entire PC hardware, and 10 times more
than the price that Steve Ballmer wants PCs to cost.

"The Microsoft software in the average user's PC is the most expensive
part of the computer, and is the reason why it will never be possible to
create a US$100 computer when using Microsoft products," said OSIA
spokesperson Mike Williams. "Hardware suppliers are already struggling
on margins of a few percent, while Microsoft makes a profit of almost
80% on its core franchises of Office and Windows. We find it refreshing
that Mr Ballmer is acknowledging that this level of price gouging can't
continue, not if he is serious about a US$100 PC. The only way to make
that happen is to use commodity products like Linux and OpenOffice.org,
which have comparable or better facilities for the markets in question
anyway."

"We understand that Microsoft prides itself on the high level of service
and support it gives its customers. With the growing popularity of free
and open source software, Microsoft clearly can't charge US$1000 for
the software that a PC requires to be minimally useful, if it is serious
about making the US$100 PC a reality. Ballmer has therefore recognised
that Microsoft has to look towards becoming a services company or a
company which adds real value to minimal-cost products. This is what
many of the firms successfully operating in the open source industry do
now," continued Williams. "Speaking on behalf of the open source
industry, we are looking forward to Microsoft joining us in the brave
new commodity world. We know we can survive and thrive here. Let's see
if Microsoft can too."

References:

[1] http://news.zdnet.com/2100-3513_22-5419179.html

- - -

About Open Source Industry Australia Limited.

OSIA is the industry body for Open Source within Australia. We exist to
further the cause of Free and Open Source software (FOSS) in Australia
and to help our members to improve their business success in this
growing sector of the global Information and Communication Technology
(ICT) market.

http://www.osia.net.au/

Spokesperson/Contact: Mike Williams
Phone: 03 9621 2377
Email: media@osia.net.au

Re: Ballmer Blames Software Piracy on Spendy Hardware, or: What

Anonymous's picture

Another reason people seem to be pirating the Windows OS is that they need it to play the latest game on the market. Picture this: you're a teenager, you're a geek, you use Linux, all of your friends are running Windows and go get the newest version of Grand Theft Auto and it requires Windows. Now, you have to realize that this kid isn't making that much money (if any at all). How do you think he is going to acquire this "Windows Technology?" He borrows it, installs it, he plays the game for a month, and then doesn't boot into Windows until his friends get a new game... It is a vicious cycle. Of course, I am assuming the kid used the money he saved by borrowing Windows to purchase the game, but games are a bit pricey too. ;-)

Re: Ballmer Blames Software Piracy on Spendy Hardware, or: What

Anonymous's picture

or if you are a geek teenager running linux you use your allowance to aquire cedega and run the game (depending on the game).. you could also get the cvs version and try it... But then again if the teenager has a computer (the parents bought) it probably came with windows...........

Re: Ballmer Blames Software Piracy on Spendy Hardware, or: What

Anonymous's picture

I don't know if you can get
the price of a whole PC down to $100, but I bet you can get the price of a 4-headed PC down to $400. Yes, you have one video card and monitor per user, and those are relatively big items, and yes you have to use more RAM (but not four times the RAM for 1 PC) but you share case, motherboard, processor, and hard drive.

Just the thing for Internet cafes, which are how much of the world gets online.

I don't know how you'd license a 4-headed PC for proprietary software, though.

Re: Ballmer Blames Software Piracy on Spendy Hardware, or: What

Anonymous's picture

Our school helped to beta test these for HP. They are nice. And no proprietary software. It's all Linux.

Re: Ballmer Blames Software Piracy on Spendy Hardware, or: What

Anonymous's picture

This, coming from the man who thinks that charging almost $600 for Windows XP Professional is somehow "reasonable". Mr Pot, Meet Mr Barkto.

Re: Ballmer Blames Software Piracy on Spendy Hardware, or: What

Anonymous's picture

I really can't see why lower hardware prices would affect piracy. If anything it should be the other way around - lower hardware prices mean that Windows is a larger proportion of the cost of a computer - thus people would be more inclined to use a pirated copy to save money. So we don't just need lower prices on hardware - we need it on software as well.

And guess what Linux fulfills that need.

I have seen lots of companies

SidW's picture

I have seen lots of companies, people and governments on a fixed computing budget. That is, they just can't come up with more money for computing. If an office has 2 computers and needs 4 it is going to buy hardware and pirate software.

The good alternative is helping these people recycle old hardware by setting up Linux-based thin clients. I don't think there is any Microsoft-based alternative that could help here--at any software price.

Actually there is a microsoft

Anonymous's picture

Actually there is a microsoft solution.

1 overpowered server running windows server with terminal services
$999 US (5 CALs) + clients running windows 2k or newer and remote desktop.
(your client machines would have to be at least pentiums though, win2k needs a bit of horsepower itself and that $999 doesn't include the hardware)

the better way

Anonymous's picture

overpowered server, is that like a single P4/athlon/athlon64? [$1000+]

and the rest of that ticket:

Network HW (10/100 +1gbe switch) = [$100]
5x recycled PIII 500MHz 10GB 128MB = $150x5= [$750]
5x 15-17 in. monitors = ($30~70)x5= [$150~350]
5x legal win2k = [??? DISCONTINUED]
5x legal win98 (came with the P-IIIs) & terminal services update= [free as in beer]

keep the server. run gdm headless (no local X or vid card for that matter) Activate XDMCP in gdm.conf. Go get a few landfill-ready 586s like the man said, but run only "X -query servername" and save the cost of the P3s, the licenses, and the licenses, and the multiple-client *APPLICATION* licenses, as well. Remember, people use applications, not operating systems... as some have already well said.

new cost: 5 monitors, network HW, 1 server. $1200-1400 depending on the cost of the monitors and that server will support even more than 5 clients. additional terminals are $20 yard-sale items or mere trash-picking fare. the only forseeable downside is the crappy screen resolution with a 1MB vid card ^_^

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