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Sun Microsystems Hardware

Sun Says Hardware Will Be Free 895

ron_ivi writes "Reuters reports that Sun's President and COO thinks hardware will be free and that people will pay for software subscriptions instead. Reuters quotes Schwartz: 'In our world, you will subscribe to the software and the hardware is free.' 'Directionally, our expectation is that in fiscal 2005 you're going to see a rapid departure from selling hardware, software and services apart.' 'Bill Gates and I agree that within four to five years hardware will be free.' We've recently read here on /. how Gates thinks hardware will be free."
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Sun Says Hardware Will Be Free

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  • by Anonymous Coward on Tuesday June 01, 2004 @01:33PM (#9305203)
    Interesting to see Sun justifying Microsoft's monopolistic view that hardware prices can keep coming down because he won't lower the price for his OS.

    They're just trying to get people using to pay more for the OS than the hardware. Think about it. You can build a $300 computer, but you will end up paying $280 to run Windows.

    They just have to keep in mind that some software will also be free...
  • But I'm a hobbyist (Score:3, Interesting)

    by kneecarrot ( 646291 ) on Tuesday June 01, 2004 @01:34PM (#9305206)
    As a hobbyist who enjoys tinkering inside my machine, I'm really starting to feel like my days are numbered.

    With DRM in the bios and computers becoming essentially free appliances will I still be able to tinker in the future?

  • Re:Free Market (Score:4, Interesting)

    by wawannem ( 591061 ) on Tuesday June 01, 2004 @01:35PM (#9305228) Homepage
    yeah, you're right dude, I mean, ever since I bought my cable converter outright I refuse to pay any monthly fee.... wait... uhmm... nevermind
  • by Darth RadaR ( 221648 ) on Tuesday June 01, 2004 @01:36PM (#9305255) Journal
    I wonder... If I stop paying my "subscription", will a van will stop by and repo my hardware?
  • by Short Circuit ( 52384 ) <> on Tuesday June 01, 2004 @01:38PM (#9305288) Homepage Journal
    I'm personally reminded of those WebTV boxes of a while back.

    IIRC, the software was never in sync with even the commonly used W3C standards. Even in the days when HTML 4.0 was new, WebTV was considered lackluster.
  • by Cheeze ( 12756 ) on Tuesday June 01, 2004 @01:38PM (#9305296) Homepage
    Sun doesn't make any money off of hardware, their cash crop is selling software services.

    Those guys need to stand up and smell the roses. hardware will NOT be free because it will take resources to produce it. If you expend resources, you are going to want to recoup those costs by charging the end user for spending time to develop and produce the hardware product.

    Software is the part that is easily reproduced, and can easily be made free.

    Sun and Microsoft are software vendors (Yeah, Sun makes hardware, but they shouldn't if you ask me). They both make money in the software, so it is in their best interest to spin their technology the way that makes them the most money, even if that is pulling the wool over the eyes of their customers.
  • Let battle commence (Score:4, Interesting)

    by Space cowboy ( 13680 ) * on Tuesday June 01, 2004 @01:41PM (#9305338) Journal

    Looking at it logically: if hardware is 'free' (or nearly so) the only way to make money is on the software, either by subscription, by initial purchase, on services layered on top of the software/hardware, or some combination. This is all fine and dandy in the 'normal' world where people wander down to a store and buy a Windows PC or a Mac.

    Look at it from the Open Source point of view - on the scale of these corporations, there's little money to be made on subscriptions without them being expensive (read: unpopular) subscriptions (eg: the redhat network has just become a lot more expensive...) so all that's left is services. It seems to me that IBM have pretty much everything going for them in that market: worldwide cover, experience, brand name, and expertise. So that's a no-no too.

    Whoops, "we"'ve run out of ways to make money - so large subscription-based companies are going to look upon the OS world as nasty competition (can't be bought, can't easily be bribed - some sod will fork the code if you do, and it's at least as good as the proprietary offerings, not to mention free). Cue drum rolls, thunder and lightning, cry havoc and let loose the dogs of war!

    It's going to be interesting. Patents will play out their part of course, Linux/just-about-anything will infringe on loads of patents, but we may still have IBM in our corner over that one - they've several thousand employees who work on linux for IBM, which is a significant investment... If a 400lb gorilla decides to screw you, the thing to do is befriend a decidedly asexual 800lb gorilla... Thanks IBM.

  • by Clinoti ( 696723 ) * on Tuesday June 01, 2004 @01:41PM (#9305343)
    Indeed and the idea isn't even that well veiled for our crowd but for the plug and play consumer this is exactly what they are going to want, a computer that they can purchase or pick up at Best Buy that they can then take home, open the box, plug it into the wall via way of the large color coded wires and it comes with a tech in the box.

    Best idea ever to impose and bring DRM into the mainstream market while simultaneously silencing the hardware modders, overclockers and OSS'ers under the threat of the law.

    The only downsides for this with both MS and SUN are that they need to have the boxes run perfect software. The market would react horribly to a product that fails in this regard especially with MS's history of instability (old school) and Suns refusal to adopt or offer up (Java debacle). We could wind up with a legion of blue screened remote managed zombies or a legion of boxes that don't work with anything else. Interesting indeed.

  • by grunt107 ( 739510 ) on Tuesday June 01, 2004 @01:43PM (#9305370)
    There will be attempts, like Sun and MS, to have subscription-based apps and supplied hardware. The hardware and software will be succeeding edge, not leading edge. I see this as the path for businesses mostly, and some home users that get their internet bundled w/apps and a free (or cheap computer). Since most businesses today are concerned about cost over benefit if their hardware upgrades happen from and are supported by their app vendors then most of their apparent IT infrastructure (OS/app/hdwe support) will be hidden in the vendor costs. A second tier will be the innovators - businesses that create new technology (and their disciples) to be eventually passed to the masses. A third tier will be the disruptors, who will not abide by forced upgrades and constant payment schedules. This tier is most likely the home of most Open Source projects (with some in the innovators group), IMO (I am not humble!!!).
  • Re:Free Market (Score:3, Interesting)

    by hot_Karls_bad_cavern ( 759797 ) on Tuesday June 01, 2004 @01:44PM (#9305385) Journal
    "I'm constantly amazed by how popular auto leasing is in this country, and how many people are thereby effectively carrying car payments in perpetuity."

    More evidence of how self-absorbed American's's only for the vanity, look-at-me factor and "keeping up with the Jone's".

    What most of them don't realize is that the Mr. Jones is a retard and has triple mortaged his nice little suburban home, expensive car (leased, not owned) and other trappings.

    Most American's would do well to take Family Finance 101 again.
  • by jdreed1024 ( 443938 ) on Tuesday June 01, 2004 @01:44PM (#9305393)
    This isn't a completely new idea. Look at cell phones. You can get the phone for free (a crap phone, but it works) and then you pay monthly for the service. Or the budding music/audiobook industry where you get a player (again, a crap player, but it works) for free if you subscribe for a year. (Examples are Napster and Audible, obviously Apple doesn't give a free player if you buy an iTMS account)

    I could easily see a future where if you subscribe to Microsoft products for a year, you get a free PC. PCs are dirt cheap anyway.

    The question is not whether or not it's possible or feasible. The question is whether Joe Consumer will go for it? There are already a fair number of things that a consumer licenses instead of owning (DRM music, etc). And it works largely because Joe Consumer is ignorant of the details and relies on the companies to tell him why what they're doing is a good idea.

    But once it starts leaving the high-tech market and hitting closer to home, there's more pushback. I'll cite everyone's favorite example of DivX (the players, not the codec). Buy a movie but you only get to watch it a set number of times? Yeah, that worked real well. I'm not convinced giving away the players would have fixed that. Disposable self-destructing DVDs crapped out for the same reason, and for environmental reasons. Why? Because people were used to buying DVDs (and, before that, VHS tapes) and owning them, and playing them as many times as they wanted until they broke or the dog ate them, or whatever. And when someone comes along and says "Sorry, you now need to pay to watch this", they say "Um, no."

    Consumers have been used to purchasing and owning computers and owning software (yeah, yeah, it's licensed, we know, but so are videotapes technically - 'Licensed for Private Home Viewing' - and we still talking about 'owning' them). So there might be a fair bit of pushback. However, consumers are equally pissed off at their hardware and software becoming obsolete so frequently. So they might just pull this off if it's plugged as the solution to constant upgrading. Time will tell.

  • Two competing models (Score:5, Interesting)

    by Quixote ( 154172 ) on Tuesday June 01, 2004 @01:47PM (#9305441) Homepage Journal
    There are two competing models here.
    1. Hardware is "free", software costs money. Analogy would be the cable TV box. You get the box for free, but you pay for the software (programming).
    2. Hardware costs money, software is "free". Example would be broadcast media (broadcast TV, radio).

    Guess which one the conglomerates like? (hint: 1).

    Only time will tell which model succeeds.

    Unlike the TV/Radio industry, the content in the computer world can be created by anyone (hence the FLOSS movement). This would seem to tip the balance in favor of #2.

    Unless, of course, suitable laws can be passed... and seeing how apathetic the voters are ("look! over there!! shiny things!!!"), it is only a matter of time before writing software becomes encumbered with patents, licensing (i.e. software professionals will have to be "certified"), etc., thereby tipping the balance in favor of #1 above.

  • "akin to the cell phone market"

    I seem to recall a time where you didn't own the telephone in your house either, but the phone company gave you one with your subscription. Anyone know how&why that model changed?

  • by Pherry ( 669969 ) on Tuesday June 01, 2004 @01:58PM (#9305633)
    I suspect the days of free hardware for consumers is more than a long way off. The target market for this kind of thing is going to be business. Think large admin farms. The locked in multi-year contracts will be lawyer - lawyer between [M$,SUN] and your company.

    The tactical advantage of this is to once again convince the major buyers that all their problems are solved by a check with bill's name on it.
  • by sydb ( 176695 ) * <michael.wd21@co@uk> on Tuesday June 01, 2004 @02:01PM (#9305674)
    In the UK phone rental used to be around five pounds a quarter.

    Seeing as basic phones cost about 10 pounds, the new model is definitely in the customer's favour.

    Actually sounds like a money spinner for the phone companies! Surprising this doesn't happen any more... perhaps people just wanted better phones and weren't taking up the rental option.
  • by the MaD HuNGaRIaN ( 311517 ) on Tuesday June 01, 2004 @02:04PM (#9305707)
    Check it out:

    You buy a 3 years subscription at 1500 per year, and they "give" you a "$7000" server.

    Excuse me, but for that same $4500, I would rather buy an XSERVE.
  • by twitter ( 104583 ) on Tuesday June 01, 2004 @02:07PM (#9305741) Homepage Journal
    I wonder... If I stop paying my "subscription", will a van will stop by and repo my hardware?

    That's an interesting question.

    The answer seems easy, no, they won't bother. Someone else mentioned cell phones and that's a good example of how this will work. Why bother to go get those? Your subscription fee will already have paid for the device many times over. No one else will want your used equipment and it will cost money to collect. Because the software is not free (libre), they can turn a remote kill switch and make it useless to you so that you have to purchase another one. If you refuse to mail the hardware back to them at your cost, you will be charged some absurd fee as per your contract. No repo van required.

  • by midifarm ( 666278 ) on Tuesday June 01, 2004 @02:07PM (#9305754) Homepage
    There's an inherent danger in the proposal to free hardware.

    First and foremost condition would be that all computers would be the same configurations. While the idea of "appliancizing" computer hardware would be wonderful for the consumer in the long run it's counterproductive. Software is more complex than say a television broadcast. While the thematic content may vary amongst shows, the medium conforms to all TV sets nationwide. NTSC or PAL is the format and there's no straying. Enhancements are only allowed for audio, and now HD is becoming more commonplace; however, new hardware must be purchased to take advantage of the new innovations.

    Which brings me to my second point, the lack of true innovation. Software writes will become more or less problem solvers than true code writers where the sky's the limit. By problem solvers I'm referring to the need to find work arounds all the limitations of the hardware to perform whatever the desired task is. Computer configurations change and improve like the wind, but without innovations and improvements, not only in speed, but connectivity etc., we are forced to stagnate. By all theoretical laws we should've maxxed the computing potential power of silicon, yet we still see improvements.

    We need forward thinking companies to push the envelope. The elements of design and function are integral to progress of computing. Without invention, originality and breakthroughs we the consumers are doomed to stagnation and a one dimensional world. In turn, software creators are forced to live and operate in that one dimension, struggling to squeeze as much out of a box that they can.

    As we've seen many times, underfunded projects are destined to die off. If hardware becomes free and available to all there's no profit. And where there's no profit there's no innovation; therefore, we will create our own stone age.


  • Re:Yeah, well (Score:3, Interesting)

    by Cheetahfeathers ( 93473 ) on Tuesday June 01, 2004 @02:11PM (#9305798)
    If by 'glorified VT100 terminals' you mean SunRays, then I would guess you have never tried SunRays. That is one of the few areas in recent years where Sun has done things _right_. SunRays are a wonderful setup, but very misunderstood. Overall, they are fantastic. You wouldn't want an engineer doing 3D CAD on it, but for basic office use, mail, web, calendar, etc. it is a fantastic thing.

    I was using a SunRay for years. The silence is beautiful, and the speed is generally fine. Of course I had to switch to Window Maker rather than the horrible CDE (Corporate Dictated Evil) or Gnome defaults, but that's just my preference. Try icewm or blackbox on it instead, if you wish.

    I do hope they get a move on with a Linux port of SunRay software.
  • " The government mandated it"

    Interesting... In a way this sounds like "dumping" [] of a product to keep a monopoly, doesn't it?

  • Hysterical (Score:2, Interesting)

    by nexus987 ( 683456 ) on Tuesday June 01, 2004 @02:21PM (#9305941)
    Has anyone checked out the price of sun hardware on sun's website recently? How come the E25k is still selling for 3.2 million dollars?!? Even their low end boxes like the sunblad 1500 are selling for $3000. Hellooooo?!?
  • by johkir ( 716957 ) <jokirby@vmth.ucdav[ ]edu ['is.' in gap]> on Tuesday June 01, 2004 @02:23PM (#9305982)
    I work in a hospital where much of our lab equipment comes as part of a package deal. The Heomdialysis Unit, for instance, has multiple types of machines, from various vendors. For about $20k a piece, we get a machine, and the software to run it. We get software upgrades and hardware upgrades *FREE* with our service contract. The nice thing about it is, no one at the hospital has to know how to program them, and when one breaks, a service rep comes out to fix it, with time, travel, and parts included. We even get new machines as models are upgraded. You could easliy market this as state of the art software, with free hardware to run it. The hardware is so specialized though, that we can't do much else with it, so it may as well be free.

    These are some of the things molecules will do....given a few billion years - Carl Sagen

  • Re:Free Market (Score:3, Interesting)

    by Mister Liberty ( 769145 ) on Tuesday June 01, 2004 @02:25PM (#9306009)
    Your analogy fails.

    How popular would car leasing be if the leaser
    would be locked by long-term contract into filling up at let's say Shell-stations only -- no matter what the competition's price would be.

    This is just a ploy to render a knock-out to the FOSS community and FOSS consumers. If they succeed the consumer will be left without
    any options and choice -- plus prob. some hardware that will be like a big brother and policeman to you.

    Thanks for your time.

  • by Grishnakh ( 216268 ) on Tuesday June 01, 2004 @02:26PM (#9306016)
    I don't know that buying your own phone+contract is cheaper.

    It's not. It's cheaper to just sign away your soul on the contract, take the free (or cheap since it's subsidized) phone, and live with the multi-year contract.

    I'm as much against being sucked into leases and subscription business models as the next Slashdotter, but I do have a cellphone with a two-year plan, and the reason was the cost. My options were: 1) buy my own phone and get a separate contract (too expensive), 2) get a contract with cheap phone, 3) get landline phone service, or 4) don't get a phone at all. #2 was the cheapest, and most convenient in every way. After long-distance charges, landline phone service is far more expensive than cellular service, plus the monopoly that runs it around here (Qwest) has the most horrible service and customer support of almost any company in recorded history. And, you have to be at home to use it... what a pain. #4 is just silly unless you have no friends, no family, and no life. And #1 was simply more expensive than #2, and not all that useful either since (in the USA) the phones are more-or-less tied to the provider since all the providers use different technologies and frequency bands (CDMA vs. GSM, etc.).

    The problem with comparing phone service to this ridiculous "the hardware will be free" concept that Sun and MS are now touting is that, with phones, there is no viable alternative to getting monthly phone service with some big company. You can't just become your own phone company, install your own phone lines across the country to your relatives, etc. If you want to get along in this society where having a phone of some type is basically mandatory (which isn't necessarily a bad thing; communication makes life a lot easier), you have to pick some company to get your service from.

    Not so in computing. The Free Software/OSS movement has been around for quite some time, and is continually picking up steam. If you want operating system software, you can purchase licenses from Sun or MS for $$$, or you can use Linux or *BSD for free (and buy support contracts if you choose, etc.). There's many options. If you're a corporation mindlessly locked into MS software and a 2-year upgrade cycle, this "free hardware" (leased hardware in reality) concept may make some sense, but if you'd rather own your own stuff, and would rather upgrade when you feel you need to instead of when some big company thinks you need to, this concept is useless. In the end, I think both models will survive.

    It's a little like leasing a car vs. buying one. I personally see no sense whatsoever in leasing a car, but a lot of people do it for some reason. Probably because the dealership salesmen managed to sucker them into it. For people like me who see no need to get rid of a car after 2 or 3 years, when it's barely broken-in, and would rather keep it 10-15 years and not make monthly payments forever, leasing is useless, and apparently there's enough people like me that leasing, while it exists, competes with buying and still doesn't constitute a majority of new-vehicle sales I believe.

  • by rifter ( 147452 ) on Tuesday June 01, 2004 @02:30PM (#9306059) Homepage

    Parent wrote: "Somebody forgot to tell Apple"

    One more interesting thing about the "HW wants to be free" model is how it'll affect Dell, formerly a great MSFT ally.

    I bet Michael Dell's not sleeping well if he's trying to sell commodity hardware that Balmer and McNeeley want to give away.

    Not necessarily. After all even now companies like Dell make money selling Microsoft licenses. The best racket are the CALs since this is literally a license to print money. Dell will not give their hardware away for free. But if they get cut in on enough of the money from the Windows licenses, they will surely provide hardware in exchange for that.

  • by Stone316 ( 629009 ) on Tuesday June 01, 2004 @02:30PM (#9306062) Journal
    If you ask me, most, if not all software should be free for personal use. The big bucks are with support agreements and sales to corporations and government.

    I like the way some vendors are moving, like Oracle. You can download all their software and experiment with it for personal use. Why do they do this? Because the more people in the workplace that are familiar with their products, the more it will be adopted.

    Why don't more companies embrace this?
  • Makes sense.. (Score:3, Interesting)

    by naelurec ( 552384 ) on Tuesday June 01, 2004 @02:41PM (#9306175) Homepage
    ...if your Microsoft.

    Take a look at Windows 98 .. [URL=""] According to Google[/URL], 21% of users are running Windows 98, a 6 year old OS which while it doesn't run the latest MS (W2K+) software, is still being used day in and day out by millions and millions of people.

    Historically Microsoft could get 3-4 year cycles .. People running Win98 by and large tend to be happy with their systems and generally only upgrade (atleast in my experience) due to hardware failure or incompatibility with some current must-have-software.

    Microsoft takes a look at the media giants, looks at internet providers, looks at phone companies, cell phone companies, etc..etc.. All of these have people paying out $40+ a month without a flinch. $40 a month x a 3 year contract is $1440. If your Microsoft, that looks a heck of a lot better than that same individual paying for a $500 box and well .. umm.. thats it.

    Not only can they get the monthly revenue stream, but they won't technically have to "innovate" nearly as hard .. people will grow accustomed to paying and just accept it as another media/telecom cost.

    If I was Microsoft, I'd want to achieve this business model as well.. reduced R&D, consistent monthly income, total lockin and piece-of-cake to restrict (DRM and so forth)

    Of course, initially this platform will be pretty cool.. I wouldn't be surprised if the broadband companies are the ones who actually do the install.

    Get your highspeed internet, pay another $50 or so a month, get the computer which has access to the online music store and other exclusive online content (of course the music store would only play on the computer.. burning to CD or so forth would be extra) plus the standard set of Microsoft software.

    Perhaps MS would even setup the box in such a way where documents and all that are stored online in a "trusted" passport account or similar. Then they can tout ease of use! "Have a problem with the system? Hit the "restore" button on the front and it will reload everything from a disk image! All your documents are safely stored online!" -- I dunno, to the masses who have pounded their head against data loss and doing everything by themselves, that might sound rather appealing .. heck its only $50/mo and you get the free computer!


  • by Anonymous Coward on Tuesday June 01, 2004 @02:47PM (#9306262)
    One of two things must hapend:
    - the meaning of free will change
    - ads using the word free will be baned

    "Free TV when you buy a remote"
    just means the price of the remote include a TV.

    "Free maintenance"
    just means the cost of the maintenance is
    included on price of the item.

    we all know that so it doesn't affect us.
    But if they use it it's because it's working
    on some people.

    On another hand if I return the remote because
    the color doesn't match my walls it's obvious
    that I should keep the TV - it was given free
    after all.
  • by rifter ( 147452 ) on Tuesday June 01, 2004 @02:48PM (#9306265) Homepage

    They're completely twisting the language here, which is nothing new. They don't mean free as in speech, or free as in beer (gratis) what they mean is the price will be hidden in the software price. You'll be paying as much or more, they just won't itemise it or offer the hardware for honest sale.

    So you'll get a software 'subscription' and the hardware to run it on in a single package, totally locked in.

    No one in their right mind would sign up for this without huge, unsustainable bribes and/or being taken in by confusing double-talk and deception. I expect they'll be trying to use both in spades to get a stranglehold on the market, then make it back in rent once they have that. But it seems unlikely they'll succeed, thankfully. One more desperate attempt to try and lock competition out of the market.

    This may also be spun much like the recent DirectTV scams. One of the most important objections to DirectTV is the requirement that you buy hundreds of dollars of hardware (useless for any other purpose) in order to use their service. So recently they started an ad campaign claiming that they were making their hardware free for a limited time.

    Of course the fine print was that you actually do pay hundreds of dollars for the hardware, up front, then they charge $19.95 less than they say they could have each month (still leaving a hefty bill) and then claim this discount pays you back the money you gave them for the hardware (which is most certainly not considered yours since they do not allow you to do whatever you want with it and demand access to it at all times).

    So it is possible you will buy a $300 Dell computer with $300 off on the $800 Windows/Office licenses (or $50 a month until you return the computer in perpetuity). Of course what Bill Gates is leading into is getting computers to the point where cell phones are now, where you cannot switch vendors because the hardware is locked to a vendor, with the additional fun that the computer is not suitable for any other purpose than what Microsoft intends. In other words, it will run their software and no other, and will come with a contract stating that you will not run non-Microsoft software. When these are the only computers, Microsoft's dreams will at last be true.

  • by h4rm0ny ( 722443 ) * on Tuesday June 01, 2004 @02:50PM (#9306303) Journal

    I have only one thing to add to what you said, but I think it worth mentioning.

    Unlike your leasing a car analogy, there is still a great deal of progress in the computer industry. Okay, yes, new models of cars do come out, and [too] many people care about having the latest. But has the speed of cars doubled in the last four years? Has the size of their Hard Drive, I mean petrol tank increased every year?

    This makes a stronger case for getting the new model than leasing an increasingly out of date older model.

    I started this post out in a negative frame of mind, but I've just realized, that this would actually help Linux.
  • I hope (Score:1, Interesting)

    by Anonymous Coward on Tuesday June 01, 2004 @02:52PM (#9306317)
    I hope people can see this for what it is. This is a clearly an attempt by SUN and MS to controll both sides of the upgrade tredmill. If you "give" the hardware away what you are really doing is including those costs in the price of the software. Right now the hardware and software businesses are partially descrete, M$ will sell me new software to run on my existing hardware as will Sun. In some cases, depending on the licensing,this reallly only matters to Sun not M$ I can get new hardware and use my old software. As soon as you make hardware and software a package though you control both ends. If I want new software you get bundle it with hardware I don't need or want by have to pay for even if there is no reason why the old hardware was inssuficent. It works in the other direction as well, I need more horsepower to host another 15 sites well, I get the privilage of being forced to upgrade to the latest IIS while I am at it even if I had put together a software image I was happy with.
  • by tmoertel ( 38456 ) on Tuesday June 01, 2004 @02:58PM (#9306394) Homepage Journal
    There are two fundamental problems with the notion that what customers really want are solutions in which hardware is a commoditized good.

    First, hardware does cost money. It isn't free, and Sun is not particularly efficient at making it. Put simply, Sun isn't ever going to be able to compete with Dell, which will crank out perfectly good boxes at prices that Sun can't touch. Even if Sun hides these extra costs in "solution fees," those costs are real and must be passed on to customers. Therefore, other vendors can undercut Sun's pricing by offering equivalent solutions in which Sun hardware has been replaced by Dell hardware.

    Second, the price that the market is willing to pay for software is rapidly decreasing, courtesy of Free software. Ultimately, the price that Microsoft and Sun can charge for their software, however well hidden, is not equivalent to the net benefit that their software provides. Rather, they can charge only for the net additional benefit that their software provides beyond what is already available as Free software. In other words, if the market can have functionality J for free, and Microsoft and Sun offer functionality J+K in their solutions, the market will only be willing to pay for K. As Free software incorporates more functionality, J gets larger and K gets smaller, and hence Microsoft and Sun's pricing power diminishes. Thus, as free software improves other vendors will be able to undercut Microsoft and Sun by offering equivalent solutions in which the proprietary software has been replaced by Free software.

    The bottom line is that a solution is hardware plus software plus services. Take any solution which involves Sun, and you can undercut it by replacing Sun with Dell. Take any solution which involves Microsoft, and you can undercut it by replacing Microsoft software with Free software.

    I'm going to enjoy watching this play out in the market.

  • by Lumpy ( 12016 ) on Tuesday June 01, 2004 @03:02PM (#9306474) Homepage
    nahh. there will always be people hacking them to do things the manufacturer does NOT WANT to happen...

    I.E. the X box... I have 2 of them and will never EVER buy games for them.. yet I will be buying a third soon.

    I cant wait for more of this kind of hardware. super cheap + hackable.
  • by properler ( 774983 ) on Tuesday June 01, 2004 @03:02PM (#9306475)
    So Scott and Bill got in bed together to lock computers with DRM. Kiss of death for Sun. News at eleven.

    But this schems works if everyone follows. Microsoft can try. XBox are not servers. MS easily can lock them, locked servers are next to useless.

    Problem with that DRM game is that China and India won't follow. China is starting boiling its own standards to avoid American patents. Smart ass analysts say "fragmenting the market is dangerous". Well, a potential market of 1.2 billions people with two main languages is not that fragmented. Someone should tell this guys from Big Apple that there is something south of the Statue of Liberty!

    Oh, and most of manufacturing is in Asia. America is working hard so that support and engineering will soon be there too. Europe will probably do the same. :(

    Now about content.
    Bill and Scott think the real value is software and content (music, movies). Problem is that Asia and easter Europe is starting to be good there to. Interesting that Tarentino movie blinks at asiatic movies. At least he is aware, that the strength of america is to be a melting pot. America can lock itself in DRM and get its culture even more inbred than it has recently become. Choice: Oprah or Jerry Springer?

    Now about software and service. IBM is using Open Source, Oracle is training ist workforce to Linux. Who needs Sun which tries to force on us its own stuff? Who want slowlaris anyway?

    Remember the Boston Tea Party. The asians can start their Asian Tea Party. any day know.

    Short of nuking them, America will have to rebuild know how, industries... Who knows? America becoming a poor country, some day some morons from Asia will think smart to oursource in America. And leadership will change again.

    A few years back, I was asking myself "will this end up with an asian Tea party". Now, I just ask myself when. I even hope that Europe will evneutally get smart. But we have just voted stupid patent laws for software. :( Empires come and goes. Europe should be smart not to stay the vassal of the states.

  • by king-manic ( 409855 ) on Tuesday June 01, 2004 @03:02PM (#9306483)
    does this coming "appliance era" spell the end of affordable general-purpose PC hardware for residential use?

    No. Just the end to warez and code your own adventures. For the vast majority of people their vision for computer use would be more comforting. The human mind ussually isn't goot at more then 5 or 6 choices. When you have literally dozens of choices to be made, most people will not sign on no matte rhwo attractive you make all the choices. thus OSS and Free and in beer software won't be for consumers and never was. Right now, Windows XP pro costs more then the computer I install it on 60% of the time. Not a huge leap to make XP subscription and to giev away the computer.
  • by lawyer boy ( 152954 ) on Tuesday June 01, 2004 @03:14PM (#9306675)
    I may be a lawyer, but IANAA (I am not an accountant). As best I can tell, depreciation is limited to tangible property (not software). There are two general classes of depreciable assets:

    (1) Personalty - Tangible property other than land, buildings, or permanent additions or components of buildings.


    (2) Realty - Tangible property that is either land, buildings, or permanent additions or components of buildings.

    I don't see how software could be included in either of these categories, but obviously hardware would be considered Personalty (I checked MACRS and found that computers are given a 5 year depreciation schedule).

    Any CPAs out there care to comment on whether software is eligible for depreciation and, if not, how important this would be for business planners?
  • by Maestro4k ( 707634 ) on Tuesday June 01, 2004 @03:23PM (#9306783) Journal
    • "Sure," the buyer will say, "I could buy a more expensive computer so I could put Linux on it, but I can get this nifty 10GHz machine for half the price."

      It's not whether there is a monopoly amongst the hardware manufacturers that will stop this, but how much in bed the big hardware sellers such as Dell are with the big software manufacturers.

    It's going to take one rather huge shift in consumer thinking for this to come about. Consumers have been buying cell phones that are locked in to plans for years, with computers they're used to paying once and owning it (or putting it on a charge card, but in the mind of the consumer that's still paying once.) When companies start trying to charge people for the OS every month/year/etc. people will rebel. To them it'll be a charge for something they already paid for. Even if the hardware's "free", the costs each month are more likely to be considered by the consumer as payments on the hardware, not software. People are used to owning software, no matter what reality the companies try to use with the shrinkwrap licenses.

    It's interesting to note that Sun has apparently forgotten history, this is just net computers all over again with a new marketing swing. Net computers failed miserably, companies didn't want to be locked-in to hardware from one vendor. Even if a company goes with MS software now, they can buy their hardware from multiple vendors, and replacement for faulty parts is generally pretty quick and easy. I doubt the replacement for a dead "free" computer will be anywhere near as quick, nor as easy. Since the software would be subsidizing the hardware, the software vendors would try to discourage hardware replacements. Also if the hardware's free, what do you do with parts theft? Maybe this isn't an issue in businesses, but computer labs on university campuses have a big problem with this. If you have to get your hardware from the software vendor with the software, do you just have to toss what's left of the computer parts were stolen from and buy a new software license? Boy won't that go over well!

    And on that subject, that software's going to have to cost an awful lot a year to sustain the industry standard 3 year replacement policies. So much so that either software providers will somehow have to convince business to lengthen that cycle, or charge so much it'll cost about the same as buying computers in large lots from Dell or Gateway costs businesses today. And you can bet that Dell and Gateway aren't going to just gently lie down and let the software companies take their business.

    I predict an utter, total flop. We'll be comparing this to MS Bob someday.

  • by Lussarn ( 105276 ) on Tuesday June 01, 2004 @03:27PM (#9306832)
    Sun invents standards such as NFS you know, and then share the speces with the rest of the world. Apple invents obscure quicktime formats and sues anyone who tries to use their DRM.

    Sun have given openoffice to the community, Apple gives a kernel nobody gives a shit about.

    Yeah. Apple is the pro opensource/pro standards of the two companies. It sounds more to me like a freerider on the open source wave.

  • Re:Yeah, well (Score:3, Interesting)

    by Kevin Burtch ( 13372 ) on Tuesday June 01, 2004 @03:37PM (#9306954)

    Then someone needs to slap your network engineer, sysadmin, or whoever is cutting their budgets - and fast!

    I've used SunRays at work and home, and deployed them for Universities, and everyone loves 'em.
    There's even a local engineering firm using them for ECAD. They're hardly slow.

    The slowness you're complaining about is undoubtedly a lack of network, CPU, or memory in the server. Easy enough to diagnose for a competent sysadmin.
    My guess, with no information at all of your installation, is you have far too many SunRays installed on one 100mb subnet connected to a single 100mb port on the server, or you're using a shared network for them (very bad idea).

  • Re:Free? (Score:4, Interesting)

    by iabervon ( 1971 ) on Tuesday June 01, 2004 @03:39PM (#9306980) Homepage Journal
    Everybody wants to kill the economic incentive for doing the thing they don't want to try to sell, because it transfers business to the next thing over, which they do want to sell.

    Or, at least, the smart ones do. The dumb ones don't understand the economics. This is why Oracle is so clever: they now use x86 commodity hardware (and subcontract it to Dell), Linux for the OS to kill that market, subcontract out support to Red Hat, and then get a huge margin on database servers. Of course, this plan depends on having a clear long-term strategy and sticking with it (sell the database, make everything else cheap).

    Sun is going to have a really hard time because they keep changing their mind on what the strategy is. The right strategy would have been to open source Java from the beginning and write apps. Instead, they've tried to keep control of the Java VM, which doesn't actually help them. They've been vague on whether the market for hardware and OSes should stay profittable. They seem to be trying to get into the desktop market where they don't have any particular experience or market share.
  • Hard wired (Score:5, Interesting)

    by zogger ( 617870 ) on Tuesday June 01, 2004 @03:57PM (#9307294) Homepage Journal
    --the earliest phones I remember as a kid where hard wired, no jack at all, and they didn't have a dial. Heavy suckers. One of my grandmas had one of the old crank phones, where the mouth piece was on the phone on the wall, you grabbed the single earphone and held it up to your ear, and you cranked it to get the operators attention. We had a normal looking phone though, just no dial. You just picked up the phone, if someone was yakking on it (no one had a dedicated phone, they were all party lines with like 6 houses on each circuit) you asked when they would be done. You picked up a few minutes later, and the operator came on, you gave her-and it always was a her- a number, or just told her a name if it was local. Payphones had dials and cost a nickle. Hardly anyone had a TV yet(we were the first in the neighborhood to get one), but everyone had a big ole tube job radio in the living room and some sort of record player. Those radios threw more heat then the next 10 AMD boxes put together. Smokin! They'd pull the stations though, almost all of them had built in shortwave and commercial AM, there wasn't any FM yet. Not that I remember anyway. I LOVED them things. Had a big ole grundig was my gateway to the world at night, had wires all over my ceiling in my room.

    And movies were 25 cents and the only place that had air conditioning. Cokes were a nickle. A new .22 rifle was around 12$. A one speed old heavy bike was about 25$, had enough steel in it to build two harleys I think. Not sure on new car prices back then other than below one grand for a decent one. I know the first house we lived in cost my dad 100$ downpayment, and it was brand spanking new, 3 bedroom ranch with a nice yard in a nice neighborhood. He had a ten year mortgage (I asked him later to find out), which was very common then.
  • by mic256 ( 702811 ) on Tuesday June 01, 2004 @04:11PM (#9307490)
    In my country until very recently all cell phone operators subsidized the device, locked you in, etc. About 2-3 months ago one of them decided to conduct an experiment - they have set up a new brand and said that you have to buy the phone yourself and in return you get much lower and very easy to understand prices (something like - 30 cents per minute always, whereas competitors offered something like - it's 30 cents per minute starting with second minute every second Friday and Tuesday starting from 20 till 7 but not from 11 to 11.47 and otherwise 78 cents). Clear, understandable rules, zero lock-in.
    They got 1 million (!) customers within 8 weeks(!) in a 38.5 million country, where there are like 12 million cell phones total and GSM cell phones are available since around 1996.
    They were so surprised by their own success that they had a shortage of starting sets for some time!
  • by dnoyeb ( 547705 ) on Tuesday June 01, 2004 @04:12PM (#9307507) Homepage Journal
    DIVX... (the rental movie player scheme not the codec)

    I think they are forgeting that people will pay for freedom. If your 'free' hardware makes me a slave to your foolish whims, i'll gladly buy my way our of it.
  • by dgatwood ( 11270 ) on Tuesday June 01, 2004 @04:38PM (#9307890) Homepage Journal
    But only for the people who don't know about the $2 generic cartridges on eBay and elsewhere. As consumers become more technically savvy, these sorts of schemes become harder and harder to maintain, hence we see the Lexmark suits in a desperate attempt to maintain control of an unmaintainable business model.

    No, I'd say this is just another sign that the dinosaurs of the computer age (Sun and Microsoft) just don't understand modern consumers or the trends that have plagued every other high tech industry as they gained popularity among the general public.

    Raise your hands.... How many people here rent their wired phones? How many buy the printer vendor's ink cartridges? How many people only get their computers serviced (and RAM added) at your "Authorized Reseller"? How many of you non-digital cable customers still rent your cable box? How many of you only use offical Kodak paper for printing photos or Xerox paper in your photocopier? Anyone? Anyone?

    Vendor lock-in (monopolies notwithstanding) only works when there is little to no competition in the market and when the technology is sufficiently new or advanced that it has not yet become a commodity item. For example, cell phone technology is still changing so rapidly that there is some degree of lock-in (though the phones are cheap enough that this doesn't prevent people from changing companies). Same goes for digital cable. Within five years, digital cable tuners will be built into most mid-range TV sets. I'm not still not sure how long the commoditization of cell phones will take.

    In any case, most people only put up with vendor lock-in for a certain period of time before they get sick of it. When they do, there are always alternatives waiting in the wings. No technology has ever gone from being a commodity to being a subscription service in my memory. I very much doubt that software will be the first---at least not successfully.

    What I expect to happen is that we will see progressively -less- incentive to directly use a computer for general tasks. Instead, more and more devices around our homes will become more advanced, and special-purpose computing devices will pop up (TiVo, for example), not with subscription software at all, but with embedded software (which may or may not ever get upgraded).

    The notion of software will become ever less important, and hardware will become an even greater driving force in the computer industry. There's no reason I couldn't have a word processor built into my TV set. Heck, there's no reason my cell phone couldn't take dictation.

    Admittedly, some of those specialized devices will have subscription models for things like ongoing data feeds (TiVo's channel guides, for example), but that's a far cry from subscribing to the software itself. Also, I don't expect stand-alone computers to go away. Rather, they will provide the central mechanism for coordinating all of those advanced devices. The alternative is too horrible to imagine---vendor lock-in on data storage.... :-)

    But that's just my opinion. I could be wrong.

  • by beakburke ( 550627 ) on Tuesday June 01, 2004 @08:32PM (#9310453) Homepage
    Hardware has a marginal cost to make that is far from zero, and software doesn't. Thus even if hardware becomes commoditized, which it pretty much is in the PC world, It still isn't ever free (not for real). Software, OTOH, essentially has a marginal cost of zero. Thus it makes more sense for a company to sell hardware and give away software that adds value to the product than to do it the other way around. They want to spread the fixed software costs over a lot of hardware units. Thus one makes (or utilizes open source) software to make their hardware more valuable to the end user.
  • by pingveno ( 708857 ) on Tuesday June 01, 2004 @09:02PM (#9310661)
    I smell a challenge to meaningful competition. It's already bad enough with the stagnant IE; now many, many more products may be left behind by lazy vendors.
  • Re:Hard wired (Score:5, Interesting)

    by zogger ( 617870 ) on Tuesday June 01, 2004 @09:03PM (#9310665) Homepage Journal
    Got my tech enthusiasm from my dad, who was a radio/radar tech in the navy in ww2, then went on to be a mr fixit guy for them things back in civvie life, then went on to work in mainframes. I got to see and help work (some, mostly astanding around getting in the way) on some really old full building sized monsters way back then. He's retired now, but is still a mad garage inventor/tinkerer. Heh, he used to be a "case modder". This is funny. All the old radios and tvs he worked on for people, he would throw a fan in there mounted inside a coffee can, they kept the machines cooler, the tubes went out less often=happier customers, more word of mouth business for him. Another time he built his own electric guitar and amp and had a small band he played in, mostly what is called rockabilly now styled music. My mom jammed on keyboards-a real piano. Heh. They also really encouraged me, were good parents, I learned to read at age 4, that certainly helped.

    I'm red-green deficient color blind unfortunately, so back then I really couldn't get into electronics much from color coded wires and resistors, etc, much to my regret to this day. I can tinker some with electronics now, but it's just strictly amatuer hour there. I'm a fair mechanic/carpenter and have had quite an amazing variety of jobs and experiences. To me, life is a great adventure, if you ain't having fun and learning, you'll just shrivel up and get sour. Ya gotta stay physically and mentally active. I always liked computers, but never afforded one until the early 90s when they finally got cheap enough for me to get good used ones. Now it's just a hobby and a great commo tool, an adjunct to radios. Hmm, another thing my old man made was really spiffy, back in the late 60's we had a big backyard pool, the last couple years I was living at home. He and I installed a home brew solar water heating system for that pool, we picked up two more months of good swimming with that thing (up in michigan where I grew up). He was always making stuff like that. Another one I remember he made a capacitive discharge ignition system for those old 59 chevy wagon he had. It was a bear to start in cold weather, he built this thing one weekened and poof, that car just CRANKED and ran no matter how cold it got.

    Lots of older folks are tech savvy, remember, all the tech we have today came from guys like my dad back then doing the ground work. 50 years from now you'll look back and go "man, that was some primitive stuff back then in 2004!" HAHAHA!

    ipods! We didn't have no steenking ipods! I had a crystal radio I made. The potential between the antenna and the ground wire made the juice to run it. The tuner was wire wrapped on a carboard tube, the ear phone was a rubber eraser with a needle in it and some bits of plastic crap. the whole thing was mounted in a cigar box. Wish I still had it.. hmm Dang if I could remember it better I'd describe it better, but that was most of it AFAIK. It actually worked, with a lot of fussing you could get a couple of stations. Nuthing like that grundig though, I STILL don't have a radio that could pull the stations that old analog monster could.

    some stuff was cooler back then, some stuff is cooler now, it's a fair trade off I guess. *Much* less crime, and your buck was worth a lot more, and wicked easy to find good work, and things you could get were mostly still cheap, and quality was excellent. Now you have a lot more variety of *things*, but they don't last as long. Stuff all costs too much, which they keep trying to fix by inflating the dollar, but it still hasn't worked. We got a lot more white collar businessmen/bosses/mamagers/ whatever per human than we used to. And the economy got worse. Politicians still suck. I think they always have sucked, because it's a sucky job probably. Corporations are even more bogus, but they bring us cool stuff, so we are stuck with them, that'll be the fight that lasts forever. We have much better information now, you can go find out about ANYTHING you want to sitting in your living room, this is WAY cool.

    Still, no cheap flying cars, and no hot babe amazon robots for your private army.... I'm HOLDING OUT!

If I have seen farther than others, it is because I was standing on the shoulders of giants. -- Isaac Newton