VMware Price Hike?

There's an old story about economics that I think my dad once told me. It seems that Smirnoff vodka was losing market share to its lower-priced rival, Wolfschmidt, back in the '60s. Instead of slashing its prices to match those of Wolfschmidt, Smirnoff did something no one expected: It raised 'em. All of a sudden, Smirnoff was a premium brand, and sales rose.

Apparently, VMware is the Smirnoff to Hyper-V's Wolfschmidt. Over in Europe, VMware is raising prices, at the exact same time that a nearly free Hyper-V is coming to market.

That may work for a while, but in the long run, VMware is going to have to react to Hyper-V pricing. Look at what happened with Netscape. It kept charging for its browser even as IE was free. Hmm, didn't the Netscape browser business ultimately disappear?

What would you do if you ran VMware? Send your corporate tactics to dbarney@redmondmag.com.

Heckling iPhone Fans
The Apple crowd is a pretty loyal lot. These are the folks that line up whenever there's a hot new Mac, iPhone or Steve Jobs sighting.

One TV reporter, though, mistook this crowd for the Dungeons & Dragons-type folks that camp out waiting for the next PlayStation or Nintendo. This TV reporter thought Apple fans were pimple-faced losers with no social skills -- and no guts.

But when he asked, on camera, a bunch of folks standing in line for the new iPhone if they had ever kissed a girl, he got completely owned by one dude. This guy coolly explained how uncool it was to assume that iPhone fans were a bunch of dweebs. After this got posted on YouTube, I'm sure this guy has plenty of interested gals.

Containing the Cloud
Cloud computing may not take over our entire world of computing, but it's clearly going to represent a large chunk of how we conduct business. And that has some rather huge security implications.

For one, all these service companies need to ensure that their software -- and your data -- is safe. This means that the security software market is going to be less about anti-virus on your PC and more about anti-hacker on huge server farms.

There may be an upside to this. It just may be easier to secure a service provider's infrastructure than it is to lock down hundreds and thousands of systems that may be scattered throughout your enterprise. If that's true, our data may ultimately be more secure in the cloud.

Of course, when you shift computing models, you also need to shift how you secure it all. In this case, securing browsers and network connections is key, as is locking down passwords and, as always, protecting data on local systems, whether it comes from a cloud or not.

Is the cloud more or less secure? Answers welcome at dbarney@redmondmag.com.

Meanwhile, I got a great letter from Andrew in response to an item about whether Microsoft will be as powerful in the cloud as it is in packaged apps:

"In today's article titled 'Microsoft and the Cloud: The Desmond Perspective,' you raise the question whether Microsoft can move from a maker of packaged software to a services company. What a lot folks don't look at or bring into the discussion is that in fact, Microsoft has made this possible for years through subscription licensing. Partners such as ourselves have been offering Microsoft software in the cloud for quite some time. The only difference now is that they are working to have their own offerings.

Being one of those providers, we know that it will be quite some time before their direct offering will have the full capabilities that many of their partners are already able to provide. For example, we provide SharePoint as both a WSS and MOSS offering today through one of our divisions (http://www.sharepointhosting.com/). Today, we have over 1,000 current SharePoint customers and growing exponentially. A number of these are Fortune 100 companies running mission-critical sites. When you add in the other clients that have used our services for more limited needs such as pilots, temporary project sites, etc., that number equals over 3,000 customers that we have worked with.

Microsoft has quite often looked to their partner community to lead the charge and we are right out there on the front lines!"

Mailbag: Microsoft Plays Monopoly, Windows 7: Son of Vista, More
Microsoft is sounding an alarm over the Google/Yahoo ad deal, calling it a monopoly in the making. Coming from Microsoft, this might be ironic -- but not that surprising:

Ironic? No, it's about time. Turnabout is fair play.
-Anonymous

This is just as ironic as when IBM got to finger-pointing at Microsoft during the Microsoft monopoly hearings. Youngsters might not remember IBM's own monopoly issues, but the rest of us do.
-Stan

What goes around comes around. I think Microsoft is justified using the same arguments that have been used against it -- and the results should be the same if the legal systems are balanced as they claim.
-Anonymous

Microsoft's enemies have used the monopoly chip against them and now they want to turn the tables on Google. Having politicians and the courts involved in this is not good for the consumer's pocket book or for technology innovation. I trust the market to make the corrections needed.
-Tom

After reading your comments about Microsoft, the potential Google/Yahoo deal and the words "monopoly" and "ironic" in your column, another word immediately came to my mind: HYPOCRITE. Kind of like the pot calling the kettle black. Just like a terrorist calling the United States a bunch of murderers. Kinda of like sending a fat, overweight U.S. senator overseas to a Third World nation to investigate their poverty and hunger. Tennessee Williams said it best in "The Rose Tattoo," Act 3: "The only thing worse than a liar is a liar that's also a hypocrite!"

How long before we see Microsoft changing its trademark to a guy wearing a black hat, a tuxedo and a monocle?
-Les

Microsoft has suggested that Windows 7 will pretty much be based on Vista. Too much of a not-so-good-thing? Here's what some of you think:

Over the last months, I have read several news reports saying that Windows 7 will address the 'bloatware' that Vista has become by being more of a thin client that can be readily expanded. Now Veghte is saying it will be built on Vista? Did those reporters fall for more obfuscation?

As the world swings toward making more use of laptops and notebooks, Microsoft must understand that these devices are NOT readily upgradeable to have terabytes of RAM once Windows 7 releases. I have an old Dell Latitude at home that I'm not throwing away just because it can't support Vista; I'm moving to Ubuntu.
-Ian

I think that Microsoft made a major stumble at the wrong time. Vista was way late and many of the great features were stripped in order to finally ship it. It was so slow and riddled with bugs and incompatibilities that it got extremely bad press. At the same time, Linux was making huge strides in compatibility and ease of use with Ubuntu, etc. A couple years ago, Linux wasn't in a place to compete at any level with Windows, but now it is much further along.

Microsoft making a big announcement that Windows 7 is based on Vista so you might as well upgrade to Vista now is going to backfire on the company, I think.
-Matt

I saw in your post today that you included some Windows 7 information, and I wanted to clarify a minor point. In your post, you write the following: "Second -- and this is the first such official proclamation -- Veghte stated that Windows 7 is based on Vista."

There was a post by Chris Flores on the Windows Vista blog in May which disclosed this information.
-Mary

Rick shares his thoughts on Microsoft's approach to standards:

I work in a part of the technology sector where collaboration and cooperation are essential. In my opinion, Microsoft sets itself up for the cheap shots in the manner it tries to collaborate or share with the technology community at large. It's one thing to invite the technology community to participate in the creation of a file standard, as opposed to developing a file standard and presenting it to the technology community for ratification or acceptance. The first approach is inviting and suggests willingness to accept outside review and input; the latter is easily construed as an obnoxious attitude ("Here it is, take it or leave it").

Still, a powerful argument against collaboration is that development speed suffers dramatically. Also in the mix is the fact that system changes are best made in the design phase and not the implementation phase. So when a non-Microsoft entity makes a valid observation or suggestion, Microsoft can ignore it on the grounds that it would be too costly to implement, opening itself up to criticism.
-Rick

Robert is still wondering about Diane Greene's unexpected departure from VMware:

Seems to me that EMC overlooked a significant factor in that by letting Greene go, users who were accepting of VMware as "the best game in town" are now going to say, "Hmm, guess I should look at Microsoft and Xen and etc." The old law of unintended consequences may really come to bear.
-Robert

And Charlie gets the final word (hopefully) on the Nick Hogan hate-train:

I agree with you -- Nick Hogan is a dirt bag. Here's a rule of thumb: There are no real heroes on "reality" TV. Most all of the participants are either losers, wannabes, has-beens or, as you put it, dirt bags.
-Charlie

Tell us what you think! Leave a message below or send an e-mail to dbarney@redmondmag.com.

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