Recently I have started to experiment with Google Waves, a new collaboration/mail/messenger/(?) tool. And in my home-brew Ruby subtitle-editor, I even have a mash-up routine with Google Translate to convert my movie subtitles from Hindi into Dutch and vice versa . The business model that Google works upon creates an extremely innovative and strong brand which everybody is aware of thus ensuring that everyone uses the Google Search function. The money comes from advertising . Very clever, not? 

 

Apple too has a different approach. In fact, their softwares like OSX and Office-like tools are almost free of charge. For only US $229, you can buy a family pack for 5 machines with Snow Leopard + iLife’09 + iWork’09. In a Microsoft environment, it is difficult to get that for less than US$1000 and then only in an OEM version. Apple also has iTunes, the iPhone App-store, and even a link to own content, Pixar. The real money for Apple comes from selling hardware. Apple considers itself as a consumer product company not a software company.The business models from the other big players (Microsoft, Oracle, SAP, IBM) are mainly based on only selling software. IBM and Oracle are a bit different with a strong Services Division in their portfolio and, of course, IBM still sells hardware. Microsoft has some experiments like the games hardware and Bing but that only delivers marginal money compared to the rest, yet.

 

In fact, the lock-in Google and Apple are trying to achieve is similar to what a the lot of Telco operators do: give away a free phone at the expense of a long-term subscription. Or, what UPC (a Dutch cable company) does in the Netherlands: if you take a TV-cable subscription, you will get Internet for free and vice versa.Even IBM and Intel seem to take this route along with others but there is another connecting factor too: Open Source. All softwares of the "innovative bunch" have a foundation on Linux or UNIX. That simply means that they can outsource a lot of development just to "the communities" and focus on the specific added value of what they want to deliver. The "legacy bunch" has to do everything by themselves, everything is proprietary. Only Oracle seems to have made a great move with the acquisition of Sun. Very smart. IBM, SAP, and Microsoft are seriously upset about that. Can SAP go on with the incorporation of JAVA now that Oracle is the "moderator" of the language? That MySQL is in the package too, does not help IBM and Microsoft either. If I was Leo, Sam, or Steve (B), I would have bad sleep. And if I was Larry, I would go for another round of racing and relaxing on my yacht for a while.

 

And so, what does this all mean for a Microsoft C# or SAP ABAP developer? Well, if you are good at it, relax. Both companies have so much money and are so dominant on the global scale that they will hang around for at least the next decade or so. But if you have to start a fresh career, keep your eyes open and maybe you should think about the next step soon.

Have fun following the market space