Good article on CNET on how Microsoft is under pressure in the Asian market.
Microsoft has always maintained a ‘one-price’ policy, meaning Windows costs the same no matter where you go, regardless of local currency or economic conditions. This makes Microsoft products very expensive in some nations. Now, with more governments turning to open-source, Microsoft is striking a deal with the Thai government, and looking to do the same with others:
The “entry-level” version of Windows was created to allow Microsoft to participate in the Thailand ICT Ministry’s program without adjusting its policy of charging the same price for Windows and Office no matter where in the world they are sold, Microsoft said Monday. The software was provided at a cost of 1,500 baht, or about $40, compared with the usual price of several hundred dollars.
So basically they’re creating a crippled version of Office and Windows in order to stay competitive, so these governments are paying less, but also getting less. One wonders how long this strategy will work for them. Microsoft claims that Linux isn’t a competitor, but with the number of user–friendly Linux distributions on the rise, free will become an increasingly tough price to beat, especially in countries where XP and Office will set you back the local equivalent of $3,000.