5:20 AM ET March 17, 2000
By John Spooner and Mary Jo Foley, ZDNet News
pressure from Linux in the embedded-device market, Microsoft Corp. is
contemplating giving away Windows CE to some developers for free. The
company is unlikely to go so far as to try to claim its effort to be Linux-like
open source, but it nonetheless seems to be counting on riding the open
source movement's coattails. Microsoft Corp. could make public its plans
to open the Windows CE source base as soon as its Windows Hardware Engineering
Conference (WinHEC) in late April, sources claim.
For embedded-device markets such as set top boxes, Microsoft easily could
afford to give the OS away to encourage developer support. Licensing fees
for the purpose of a set top box for cable companies costs very little
money on a per-copy basis. One source speculated that in large deals,
Microsoft charges less than $1 per copy. Microsoft's revenue comes, instead,
on development tools and maintenance contracts, sources said.
For now at least, developers say that Microsoft isn't contemplating going
so far as to turn Windows CE into an open source project, which would
allow developers to make changes to the source code and share their work
with Microsoft and others in the development community.
for its part, declined to comment on its Windows CE licensing intentions.
CE is best known as the operating system for Handheld PC and PocketPC
(formerly Palm-size PC) devices. However, Microsoft also is positioning
it as an embedded operating system that complements its Windows NT Embedded
product. Windows NT Embedded, Microsoft has said, is aimed at larger,
more complex devices, such as network switches.
Yet another attempt by Microsoft to do anything serious beyond the desktop
and server space. Microsoft has been trying desperately to break open
the PalmOS hold on the palmtop/handheld market. However, this rumored
move seems aimed at markets beyond the handheld. Microsoft is considering
extending Windows CE beyond the handheld platform; getting developer mindshare
early is one way to help secure a position in other areas. These areas
will include the nascent "Information/Internet Appliance" market, where
the "MSN Web Companion" - whenever it ships - will run on WinCE.
secondary purpose is to steal some of Linux's thunder/momentum. Microsoft
has seen the public's response to Linux (although we believe this is more
due to the price and robustness than to it being open source), and they
are concerned that the embedded-OS market will experience the same phenomenon
as the server market.
MS will make lots of money from owning the rights to whatever applications
get developed (a typical part of any development agreement with MS), so
they can afford to consider giving away the OS. Besides, the license fees
for WinCE don't compare with those of Win 9x and Win2K. If Microsoft can
gain market share by "giving up" the short money for the source code,
that's probably a good tradeoff for them.
they need no further prodding, this "announcement" will help push the
embedded-Linux vendors to move faster. The sooner a bug-free and application-rich
embedded Linux is available, the sooner it can make inroads into the handheld
and embedded space. It would be a mistake to release an embedded-Linux
as buggy as some Windows releases - the same rules of acceptance/usage
will not apply to Linux as they did to Windows.
subtext to the handheld market battle is the belief that many corporations
will increase the ubiquity of handhelds, thereby resulting in a new growth
spurt for this market. Although handhelds will not replace the good ol'
desktop PC, their functionality is increasing rapidly enough that their
use as an alternative will no longer be pooh-poohed. This is one of the
reasons Microsoft will never give up on the handheld market.
The primary focus of this discussion is the development community, not
the end user. For some developer(s), the key question is: am I (or are
we) willing to give up all rights to my (our) creation, just to get some
free source code? This may pose a dilemma to some - certainly not all
- developers. Three years ago, this would not have been an issue, developers
would have figured on the inevitability of Windows, and reacted accordingly.
With the Department of Justice (DOJ) anti-trust trial apparently going
against Microsoft, developers may decide they have other alternatives
- like Palm and Linux.
The secondary focus is the consumer market. The current handheld market
is 80% Palm, but the set-top box is still largely Microsoft. Microsoft's
move may pre-empt any move by embedded-Linux vendors to make inroads into
For the corporate end user, the longer question relates to whether Microsoft
will ever dominate handhelds and appliances the way it has dominated the
desktop. Most users will not care - all they want to be able to do is
run their applications with a minimum of aggravation. At that level, users
will have to see if WinCE or Embedded NT or any other embedded Windows
product will perform as well as the Palm OS, embedded Linux, or any other
non-Windows embedded OS. We expect this decision point will not occur
until the second half of this year at the earliest.