Technology news and Jobs 
VIRTUALISATION Microsoft blames open source for revenue fall
VIRTUALISATION Microsoft blames open source for revenue fall | Microsoft blames open source for revenue fall |
|
| by Sam Varghese | |
| Wednesday, 05 August 2009 | |
  
Featured Whitepaper
5 Best Practices for Smartphone Support
And it has acknowledged that as free and open source software continues to gain acceptance, its earnings may decline further. Microsoft saw revenue fall to $US13.10 billion. This is the second straight quarter for which sales graphs have showed a downward trend. While profits fell across its business, the biggest drop was in its client division - 33 percent. The software giant made mention of GNU/Linux - what CEO Steve Ballmer once referred to as a cancer - as one of the factors in its 10-K filing to the US Securities and Exchange Commission. "The Linux operating system, which is also derived from Unix and is available without payment under a General Public License, has gained some acceptance, especially in emerging markets, as competitive pressures lead OEMs to reduce costs and new, lower-price PC form-factors gain adoption," the filing says. "Partners such as Hewlett-Packard and Intel have been actively working with alternative Linux-based operating systems." Google also merited some mention. "Competitors such as Apple, Google, Mozilla, and Opera Software Company offer software that competes with the Internet Explorer Web browsing capabilities of Windows products, the filing said. "User and usage volumes on mobile devices are increasing around the world relative to the PC. OEMs have been working to make the Google Android mobile operating system more compatible with small form-factor PCs or netbooks." The licensing terms for free and open source software was cited as a risk factor. "Certain 'open source' software business models challenge our license-based software model. Open source commonly refers to software whose source code is subject to a license allowing it to be modified, combined with other software and redistributed, subject to restrictions set forth in the license," according to the filing. "A number of commercial firms compete with us using an open source business model by modifying and then distributing open source software to end users at nominal cost and earning revenue on complementary services and products. "These firms do not bear the full costs of research and development for the software. Some of these firms may build upon Microsoft ideas that we provide to them free or at low royalties in connection with our interoperability initiatives. "To the extent open source software gains increasing market acceptance, our sales, revenue, and operating margins may decline." |
Tags
| < Next story in category | Previous story in the category > |
|---|
