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Technology Stocks : MSFT Internet Explorer vs. NSCP Navigator
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To: Alan Buckley who wrote (14191)11/18/1997 4:29:00 AM
From: Keith Hankin  Read Replies (1) of 24154
 
I don't see where I contradicted myself. The two statements I made are actually quite consistent. It seems that you don't understand the history of the economics of computer systems. It has to do with several issues, particularly having to do with the markets at which the OSes were originally targeted, and it also has to do with volume. The reason that UNIX software is much more expensive is the same reason that mainframe software is much more expensive than UNIX software. UNIX software vendors cannot sell their software at PC prices because they cannot sell in the volumes that they can with PC software. UNIX systems were designed for engineering, usually sold with hardware that, because of the requirements needed to handle demanding jobs and because it never generated as much in the way of volume, was inherently more expensive. Thus fewer units were sold. MSFT did not bring about the economies of scale by bringing better products out, but by creating a monopoly. The rest was self-creating.

>>> MSFT is expanding into the Unix markets by solving important problems Unix
vendors never did, namely the high cost and lack of applications due to
incompatibility among vendors. This is of critical importance to many customers yet
the Unix vendors for years have chosen to ignore it.

How is MSFT solving problems any different than the UNIX vendors? The only difference is that they are able to capitalize on what Reg so fondly calls "economies of scale". In other words, they sell their own incompatible software, but because of their monopoly, people will buy it. Their strategy is no different from the UNIX vendors. They are not solving any problems that UNIX hasn't been solving for years. BTW, the only studies that I have seen so far comparing the cost of UNIX vs. NT system installations indicate that NT is *not* cheaper.
But it is still winning out because of all of the issues that I have already mentioned, particularly in the area of application availability.
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