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Business 2.0: The Microsoft/Linux Connection, Explained

Dec 17, 2002, 16:00 (8 Talkback[s])
(Other stories by Eric Hellweg)

"Last week, when research firm Meta Group of Stamford, Conn., predicted that Microsoft (MSFT) would begin to support Linux by late 2004 with some of its key server products--Exchange, IIS, SQL server, and the like--reactions ranged from outrage to befuddlement. A source inside Microsoft called the report 'wacky.' Analysts of all stripes debated the veracity of the findings. Even Dale Kutnick, Meta's chief research officer, admitted that Microsoft 'is pissed.'

"Though the 'Microsoft to run Linux' headlines are shocking, the report's conclusions make a lot of sense. Indeed, a more shocking headline would be 'Microsoft not to run Linux...'

"However, the notion that Microsoft might port its server software applications to Linux is on its face akin to heresy. Right now, the overwhelming majority of Microsoft's revenue comes from its Windows products. Stepping back from Windows would be like 'admitting that Linux was dominant,' says Stacey Quandt, an analyst with Giga. Quandt believes that Microsoft will counter the Linux threat by reducing prices to make its offerings more attractive--and competitively relevant..."

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