Time to Pick Up the Pace
I guess weneedn’t congratulate ourselves that we made it through the real change of themillennium a couple weeks ago. Unlike the first -- and premature -- coming ofthe new millennium so widely celebrated a year ago, this New Year’s Eve was nota major event for IT departments. Hopefully, most IT professionals were allowedto take the holiday off this time around.
But justbecause the conclusion of 2000 didn’t include all the hoopla mixed with a touchof dread that the prior year had does not mean that 2000 wasn’t a dramaticyear. Two top stories that impacted the computer industry during 2000 willlikely continue to shake things up during 2001.
Windows2000 finally transitioned from a grand vision that slowed down purchasingdecisions on competitive products into a real product with a large -- butfinite -- set of capabilities. IDC’s models, however, show that Windows 2000Server only accounted for a minority of the combined Windows NT and Windows2000 Server shipments during calendar year 2000.
Thepercentage is expected to grow to 56 percent during 2001, but Microsoft islearning a lesson about how hard it is to introduce transition into enterprisesthat adopt technology to leverage the business benefits that it provides, notbecause a product is new or sexy. A bigger threat to Microsoft is that ActiveDirectory adoption might not follow Windows 2000 adoption, leading to Windows2000 member servers operating in an NT 4 domain structure on a long-term basis.This scenario would invalidate some of the best new features that Windows 2000offers.
Windows2000 Professional is the bright spot for Microsoft. During calendar year 2000it accounted for more than 40 percent of the combined Windows NT Workstationand Windows 2000 Professional shipments. There is little reason why this won’tbe a highly successful product. Coming late this year is the next-generationWindows 2000 technology that is being developed under the Whistler code name. Microsoft is putting someadditional pressure on customers to encourage a move to Windows 2000Professional by discontinuing the ,E
Whistlerwill bring Windows 2000 Professional benefits such as reliability and stabilityto the consumer user. While the Whistler consumer products won’t offer some ofthe manageability features that Windows 2000 Professional can in an ActiveDirectory environment, they will bring a lower price point, and as such, willbe embraced by some cost-conscious corporate users.
Open Source Software
It isbecoming increasingly clear that open source software is having an impact onthe industry. Santa Cruz Operation (SCO), for one, suffered a major decline inrevenue during the past year that, in part, can be attributed to Linux.
During2000, SCO’s shipments declined, and its revenue declined faster. The message isthat downward price pressure is here for low-end Unix. Likewise, Novell’srevenue declined at a higher rate than NetWare shipment declined. It isunlikely that Microsoft will be immune from this trend forever.
Theresponse from the Unix system vendors has been, for the most part, to adapt,adopt and embrace. IBM has anointed Linux as one of its key operatingenvironments, and has worked with Linux vendors and the open source communityto get the environment ported to IBM hardware, including the zSeries systems --formerly known as the S/390. Hewlett-Packard positions Linux as its entry“Unix,” and has come forward with a strong interoperability story between HP-UX11i and Linux, particularly on 64-bit Intel Itanium environments. Dell also took the stepof declaring Linux as its third strategic operating system.
SunMicrosystems took the surprise step to offer free licenses for the use of itsSolaris for Intel- and SPARC-based systems with eight or fewer processors. Evenmore daring, Sun is licensing the source code for Solaris to interested partiesso they can potentially contribute to Solaris development or consider its usefor special or embedded applications. This move was particularly important forSolaris on Intel, which faced a dim future as a paid product.
Thecollapse of the dot-com and Linux stocks -- which had to happen -- did a goodjob shaking up the confidence in the investor community. The side effect ofthis implosion is that new business models, including those of companiesplaying in the open source space, are finding themselves more closelyscrutinized than had been the case before. The “p” word -- profit -- hasreemerged as a mandatory piece of any IPO filing.
Lookingahead, it’s likely that we’ll see some changes in the Open Source market thisyear. The depressed stock values of Linux vendors vastly improves theircandidacy as acquisition targets, and makes it far more difficult to floatadditional stock. Look for some of these companies to get creative to expandtheir business prospects during the coming year. --Al Gillen is research manager for system software at IDC (www.idc.com)and former editor-in-chief of ENT.Contact him at email@example.com.