Governments seek alternative to Windows

For all the people who have long complained that Microsoft operates a monopoly when it comes to operating systems, there is news that just might cause a ripple in the Windows world.  At the recent Asian Economic Summit, a trio of countries – Japan, China and South Korea – announced plans to develop an “inexpensive and trustworthy open source operating system” that would be based on a system such as Linux.

Ostensibly, the three countries are collaborating on the effort in order to move away from proprietary Windows-based operating systems and more toward a portable open source operating system that could work on networked digital gadgets such as mobile phones and PDAs.  Backed by large players in the consumer electronics industry, including Sony, NEC and Matsushita Electric Industrial, the countries are worried about Microsoft having too much control over the PC and electronics industries with its pervasive Windows-based products.

Japan’s trade minister has also raised concerns over security flaws in Microsoft’s products.  The recent spate of high-profile and fast acting virus attacks give credence to this concern.

Cynics contend that Japan may be trying to get even with the U.S. and Microsoft after the U.S. pressured Japan into abandoning a project in the late 1980s that posed a technological threat to Microsoft’s proprietary software business.  Ironically, Microsoft is now crying foul over the current developments saying that “market forces” and not governments should determine what operating systems computer users choose.

To counter the open source movement among these and other Association of South East Asian (ASEAN) countries, Microsoft has invited them to participate in the company’s Government Security Program.  This program gives national governments and international organizations access to Microsoft’s source code, as well as technical advice on security.

Unfortunately for Microsoft, this may be like putting the finger in the dike during a flood.  While it tries to get China, Japan and South Korea back into the Microsoft fold, the government of Thailand has created great demand for Linux-based PCs.  Calling them “the People’s PCs,” the Thai government hopes to deliver up to a million PCs to its citizens by the end of 2004.  Sporting Intel Celeron processors and 20G byte hard drives, the basic PCs run Linux and sell for about $260.

Thailand’s move is more economic than technological.  The developing country is aiming to get more of its citizens online as inexpensively as possible.  The free open source software is just the ticket.

In response, Microsoft drastically lowered its prices for both Windows and Office software in Thailand.  Even so, the People’s PC still sells for about $40 less than a comparably equipped Windows-based PC.

Brazil is the latest country to launch an open source movement.  To save money, the federal government is recommending that all federal ministries, agencies and state enterprises install open source software instead of proprietary software such as Windows in new computers.  The goal is to ensure that at least 80% of new computers purchased by the government next year are configured with open source software such as Linux.  While this is a recommendation and not fully binding, it doesn’t bode well for Microsoft.

Tom Robertson, Microsoft’s Tokyo-based director for government affairs in Asia, is quoted as saying, “We’d like to see the market decide who the winners are in the software industry.  Governments should not be in the position to decide who the winners are.”  Sorry Mr. Robertson, but in the case of the Japan-China-South Korea collaboration as well as in Thailand and Brazil, it looks like the national government IS part of the market.

Hardware and software prices plummeted about 10 years ago when market forces dictated that customers would no longer pay $5,000 for a PC and $595 for a word processing package.  Looks like new market forces may be at work now, thrusting Linux or other open source software into the limelight.

Linda Musthaler is vice president of Currid & Company.  You can write to her at Linda.Musthaler@currid.com