Seeing through Microsoft's negativity
The marketing video has received a generally negative response from open source pundits, with many concluding that Microsoft is validating OpenOffice.org as a viable alternative to Microsoft Office.
But considering the 90 percent-plus share Microsoft Office has in the office productivity market, why would Microsoft validate OpenOffice.org?
At this level of market share, it's virtually impossible for Microsoft to grow its Office business unit revenue faster than the rate at which new businesses are added to the global marketplace. Eastern European countries present attractive growth opportunities -- likely the largest outside of China, India, and Brazil. Given that fact, it's not surprising that the overwhelming majority of businesses quoted in the video are from growing economies in Europe, largely from Eastern European countries such as Russia, Turkey, Poland, and Ukraine. Not a single quote is from a U.S.-headquartered company. In fact, the only North American quotes are from two school districts, which are rarely examples of effective IT.
Enterprises in emerging markets can make greenfield technology decisions -- not typically possible in the established North American and Western European markets. Emerging markets also have fewer employees with established Microsoft Office skills. These enterprises are also more willing to consider open source software, especially when initial cost of acquisition is a critical software decision criterion. That's the threat Microsoft is trying to head off with fake-outs such as this video.
Emerging markets are so important to the future of Microsoft Office's revenue stream that Microsoft is willing to validate OpenOffice.org as a competitor in the eyes of existing Microsoft Office customers in the West. This must have been an explicit strategic decision by the Microsoft Office division.
The reality is that North American and Western European companies are already using Microsoft Office, with employees possessing Microsoft Office skills, so they face several barriers to leaving the Microsoft Office ecosystem. The cost of migration, training, and interoperability often counterbalance the costs savings of using a Microsoft Office alternative. In essence, Microsoft is betting that existing customers will, by in large, remain customers and that the real competitive environment is the set of new enterprises in emerging markets.
IT decision-makers in both the West and in emerging markets should understand a vendor's business strategy before evaluating the vendor's marketing and product offerings. This recommendation couldn't hold truer than when evaluating marketing materials from the Microsoft Office division.
This article, "Microsoft's fake validation of OpenOffice.org," was originally published at InfoWorld.com. Read more of Rodrigues et al.'s Open Sources blog and follow the latest developments in open source at InfoWorld.com.