Microsoft's Masterpiece of FUD

I've been tracking the evolution of Microsoft FUD for nearly 10 years now, and wrote a short history of the subject a few months back.  But even I was impressed when I came across Microsoft's latest effort in this department: it's truly a masterpiece of its kind.

Whereas previous FUDs have revolved around details like the relative speed, price and legality of free software compared with Microsoft's own code, its most recent offering takes a different tack, and purports to look at the bigger picture.

It's a white paper from IDC, "sponsored" by Microsoft, on "The Economic Impact of Microsoft Windows Vista".  But this is not some abstract ivory-tower analysis: on the contrary, it is highly targeted, and aimed at a very particular audience - the European Commission - that is proving to be annoyingly unaccommodating when it comes to letting Microsoft have its monopolistic way.  Not content with slapping some juicy fines on the company for past misdemeanors, the European Commission is now starting to make unfriendly noises about the forthcoming Windows Vista.

The white paper is a clear attempt to head off this threat by pointing out the huge "benefits" that will accrue to Europe if the Commission just minds its own business.  Specifically:

The IDC research shows that the launch of Windows Vista will precipitate cascading economic benefits, from increased employment in the region and increased taxes to a stronger economic base for those 150,000+ local firms that will be selling and servicing products that run on Windows Vista. At least a million IT professionals and industry employees in the region will be working with Windows Vista in 2007.

These direct benefits - 100,000 new jobs - will help the local economies grow, improve the labor force, and support the formation of new companies. The indirect benefits of using newer software will help boost productivity, increase competitiveness, and support local innovation.

The implication is that the European Commission would be crazy to jeopardize these wonderful benefits by clipping the wings of this digital golden goose, or even grounding it completely.  The white paper looks tremendously professional, and is filled with tables, bar and pie charts; it has suitably serious discussions of methodology, and even introduces a few measured caveats: who could doubt its conclusions?

What makes this FUD so impressive is that this attention to detail obscures the sleight of hand that is going on here.  The white paper may predict sales by the "Microsoft ecosystem" of over $40 billion in six of Europe's biggest economies, but what this figure hides is the fact that income for Microsoft and its chums is a cost for the rest of Europe.  In other words, IDC's white paper is effectively touting an expense of over $40 billion as a reason why the European Commission should welcome Vista with open arms.

As the paper itself mentions, half of this cost is down to the hardware.  Some of these purchases would have taken place anyway; the rest represent upgrades from older hardware that cannot meet Vista's requirements.  But if Vista did not exist (or, for example, if the European Commission were to block its sale for whatever reason), the old systems would not suddenly stop working: they would tick along for a few more years, gradually being replaced.  The only justification for this hefty expenditure is to be able to run Vista: no Vista, no need to rustle up many extra billions on hardware upgrades outside the usual replacement cycles.

It's the same on the software side.  The case for Vista itself is hardly strong.  As the product's ship date has slipped, so more of its new features have been ripped out.  Now it is not entirely clear what the benefit of upgrading is (apart from the evergreen "better security", of course).  And without the need for hardware and software upgrades, the associated consultancy and service costs disappear too: most of Vista's $40 billion "benefit" is not only a cost, but an unnecessary one at that.

As far as I can tell, the phrases "free software" and "open source" are not mentioned once in the white paper.  The whole analysis ignores completely the rich and expanding world of free software as a possible alternative to Vista and its ecosystem.  Instead, Vista is presented as the only possible option for those who wish to enjoy the benefits of "newer software", as IDC puts it.

In fact, many of the 100,000 jobs the white paper claims will be generated by Vista could just as easily be created if companies and users ignored Vista and turned to free software instead.  Moreover, the wider benefits of nurturing free software - for example, in creating public resources that anyone can use - are increasingly being recognized.  None of this is discussed in the IDC white paper because proprietary software - the only kind considered in the report - offers no such social and business bonus.

This, then, is Microsoft's FUD masterstroke: by focusing attention squarely on the overall costs to society, and redefining them as "cascading economic benefits", it has finally managed to come up with a way of looking at things where free software is always inferior.

Glyn Moody writes about free software at opendotdotdot.

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"Dimension" works for

Bugrem's picture

"Dimension" works for me........

you're all missing the point

Anonymous's picture

I don't think the IDC report is as silly as most of you are saying.

Yes it might be stupid for everyone to spend lots of money and resources because a new OS is out that they don't need. This is irrelevant. The fact is that it *will* happen (we've always known we're are very stupid species as a whole right?).

People will take advantage of the change - how many did with the Y2k bug or other MS OS upgraded? Software companies will produce new 'vista' versions, consultants will help with Vista implementations.

You guys are arguing how the money should be spent on other things much more effectively but you are missing the point IMHO. Also saying things like "if they just kept XP then there is no extra cost" is true but what about the loss of business generation in the economy? There is an extra cost if there is a loss in a way.

The report is talking about what EU would miss out on if they didn't follow with Vista - like it or not M$ is a huge company that has big effects on econonies.

The report is silly

Anonymous's picture

I don't know how things are over in most European nations, but here in the States murder and selling drugs like Heroine on the street are illegal. Sure, legalizing these would create many new jobs. Sure murdering and heroine use are also inevitable. But some people think they can have a better society by creating more of OTHER types of new jobs.

The EU apparently has decided that Linux jobs creates many more BETTER new jobs than will an unrestricted Vista. Part of the reason is that more money might stay in Europe via Linux jobs than via Microsoft jobs. Also, there is so much more that can be done with Linux than with Vista (from the point of view of the reseller or 3rd party customizer or even general business) that MORE new jobs will be created with Linux. Also, many new Vista jobs will simply displace Windows XP jobs. Linux jobs will only displace SOME XP jobs, as demand for XP will continue strong in the absense of Vista. Linux costs are distributed world-wide. Cost savings such as these offer productivity increases as the money can be spent elsewhere in the IT food chain. The same money will be spent on IT in many cases, but it can now be spent to get more with Linux add-ons.

Bottom line is that a major chunk of funds spent on a Vista PC will go to one company, Microsoft, which leaves less for everyone else (whether the shoemaker or the reseller).

And finally, Vista can be sold if Microsoft simply stops using illegal tactics and if they share their protocols. The fact is that this is a win-win-lose situation. Win for virtually everyone except for Microsoft who currently has a virtual monopoly on pre-installed PC operating systems. Simply, they will fight against a fair field of play at all costs. That tenacity is what made Bill Gates the richest man in the world (and many other Microsofties among the richest in the world), and he only wants to keep going up.

The report is beyond silly.

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