Stan Beer
Monday, 16 October 2006 13:08
Opinion and Analysis
Page 2 of 3
However, Apple has not done any of these things because the reality is
that doing any one of them would put a damper on iPod sales and reduce
its market share.
For many years, the situation has been
somewhat similar with Microsoft and its Windows operating system. There
are some differences however.
One key difference is that Microsoft has more than a dominant
marketshare - it's a virtual monopoly. Thus, Microsoft charges what
many believe is too much for their product, knowing that most users
have no real choice but to pay or to illegally pirate the software.
Unlike the case with Apple, the majority of Microsoft software sitting
on users' machines is legitimate. There is, however, a significant
minority of pirated Windows copies - particularly in economically
challenged regions of the world.
Until recently, Microsoft has turned a blind eye to this piracy,
knowing like Apple that sooner or later many pirate users will convert
to legitimate users - like for instance the first time they buy a brand
name computer. In fact there is a strong argument to say that turning a
blind eye to piracy has helped the proliferation of Windows.
We have now reached a point where the strategy of Microsoft is about to
deviate from the path that has served it so well. With the release of
Vista, Microsoft is about to do two things that could be deemed to be
risky plays.
First, Microsoft is going to raise prices to a level that many would
consider unacceptable. Second, using its Software Protection Program
(SPP), Microsoft is going to scrutinize every single user as if they
were a potential pirate and, if it deems that they are, it will disable
their machines unless they pay up.
