Microsoft Versus
Dissecting Microsoft | Directory

Microsoft Versus Open Source

Microsoft Corporation's closed and secretive software development model versus open source's public and shared model

"The basic idea behind open source is very simple: When programmers can read, redistribute, and modify the source code for a piece of software, the software evolves. People improve it, people adapt it, people fix bugs. And this can happen at a speed that, if one is used to the slow pace of conventional software development, seems astonishing." - Open Source Initiative

Few explain the concept of free software better than Richard M. Stallman, founder of the GNU Project (quoted here from an interview with CNet, Dec. 4, 2002):
Free software means you the user have certain freedoms. They include the freedom to run the software for any purpose, the freedom to study what the program does, the freedom to change the program to suit your needs or commission someone to do that for you, the freedom to redistribute the software to others, and the freedom to publish and redistribute an improved version so others can get the benefit of your contributions.

People who cook are accustomed to all of these freedoms. And if you try to imagine a world where you didn't have those freedoms--a world where you can't see what the ingredients are and where you can't change the recipe--you either cook it exactly as it says or you don't eat that dish. And if you make a copy for your friends, they call you a pirate and threaten to put you in prison. That world, which is a fantasy for recipes, is a reality for proprietary software. And that world is what we in the free-software movement are saying no to.

A study (pdf) of the benefits and challenges of the diverse use of open source software found the following:

Independant research studies have proven that [bugs] can often be eliminated from software quicker with the open source model of development than in a closed model.

Many believe that the creation of open source software is detrimental to any business model because the software is typically distributed at little or no cost to customers. However, some of the largest vendors of computer software contribute work to the open source community. These include Computer Associates and IBM. Typically the corporation profits from services, hardware sales, and/or supplemental closed source software. IBM has undergone a major transformation embracing the open source paradigm and has been rewarded with huge profits. This runs contrary to Microsoft's claim that it's impossible to financially profit from open source and that their software-for-rent business model is superior.

Microsoft®'s Response To The Open Source Movement

"If something's expensive to develop, and somebody's not going to get paid, it won't get developed. So you decide: Do you want software to be written, or not?" - Bill Gates

The vast amount of software available on, mostly created for no monetary compensation, and the flexibility of the GNU/Linux operating system prove Mr. Gates wrong. In fact, in direct contrast, Microsoft has their own web site called for developers to share freely applications and source code. While Microsoft condems the sharing of source code they promote it at the same time.

"Now we see the importance in this new world with the OSS Linux phenomenon that we have to readdress the value of our offering." - Wilfried Grommen, general manager for Microsoft business strategies for Microsoft European, Middle East and Africa - Reuters, July 1, 2003

Microsoft has tried a variety of tactics to minimize the spread of open source software at their expense. First, like many threats they perceive as too small to matter, they ignored it. When the adoption of open source software continued to increase they switched to a campaign of spreading fear, uncertainty, and doubt (FUD). They declared open source software licensing to be a "viral cancer," a threat to the economy, and a threat to national security. As open source software became mainstream they changed their efforts by attempting to focus public attention on [total cost of ownership] and [performance] comparisons.

While Microsoft is trying to spread a negative perception of open source software they neglect to mention that they have long used open source software in their own products. The Domain Name System (DNS) software distributed with Windows, at least up to Windows Server 2003, is open source. The command line based ftp, telnet, and other utilities are also open source - from BSD - at least up to Windows 2000. Even more contrary to their [marketing] they have released a few of their small software products to the community with open source licenses.

From a quarterly report filed with the SEC by Microsoft® on January 31, 2003:
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations... Challenges to the Company's Business Model. Since its inception, the Company's business model has been based upon customers agreeing to pay a fee to license software developed and distributed by Microsoft. Under this commercial software development ("CSD") model, software developers bear the costs of converting original ideas into software products through investments in research and development, offsetting these costs with the revenues received from the distribution of their products. The Company believes that the CSD model has had substantial benefits for users of software, allowing them to rely on the expertise of the Company and other software developers that have powerful incentives to develop innovative software that is useful, reliable and compatible with other software and hardware. In recent years, there has been a growing challenge to the CSD model, often referred to as the Open Source movement... The popularization of the Open Source movement continues to pose a significant challenge to the Company's business model, including recent efforts by proponents of the Open Source model to convince governments worldwide to mandate the use of Open Source software in their purchase and deployment of software products. To the extent the Open Source model gains increasing market acceptance, sales of the Company's products may decline, the Company may have to reduce the prices it charges for its products, and revenues and operating margins may consequently decline.

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Copyright © 2004-2007 Matthew Schwartz