Ballmer Touches All Bases

In his Gartner Symposium keynote, Microsoft's CEO doesn't back away from questions ranging from the cost of the company's software to security and open-source challenges.

LAKE BUENA VISTA, Fla.—Microsoft Corp. has a variety of "opportunities" to take cost out of the development, deployment and day-to-day operations of IT systems, according to CEO Steve Ballmer.

During his keynote address at the Gartner Symposium here this morning, the pugnacious CEO was peppered with questions about the cost of Microsoft software, the security vulnerabilities in its products and its ongoing battle with Linux.


He pointed to Microsofts Dynamic Systems Initiative as an example of the work that the software giant is undertaking to reduce the TCO (total cost of ownership).

At the same time, more automation is needed to lower the TCO of IT systems, he added.

When asked about the deal Microsoft struck to offer customers in Thailand its software at 10 percent of what it costs in the United States to reduce the amount of piracy there, Ballmer called the deal an experiment.

"We did an experiment with a very poor country to see if it would stimulate demand. That experiment has not been a great success," he said. He added that Microsoft has also offered lower prices to educational institutions—especially in poor school districts.

The latest release of Microsoft Office, called Office System 2003, will provide plenty of incentive to upgrade, Ballmer argued, because of advancements Microsoft has made in the area of collaboration.


"It really shines for teams of people. The way we build support for collaboration will revolutionize the way proposals [among other functions] are done," he said. At the same time, individuals will want to upgrade because of the advantages in the new version of Outlook.

Microsoft, however, has no plans to develop a version of its office software for Linux.

"Theres no reason because the uptake of Linux on the client isnt there. Its smaller than the Mac," Ballmer said. Besides, he said, "nobody pays for software on Linux. At the end of the day it isnt about religion. Its about business and what people are willing to pay for."

Ballmer also defended Microsofts shunning of Linux and the open-source community by pointing out his companys participation on standards efforts around XML. But Microsoft intends to "make Windows the best platform to port Unix applications to than any other platform on the planet. We want a good migration story for Windows," he said.

Next page: Pricing pressure from Linux?