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By | November 2012
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Assignment 1
Microsoft VS Red Hat Linux: Two Contrasting Business Model
According to the article, Microsoft’s business model that based on revenue-cost-profit economics has a competitive over Red Hat Linux for many reasons. The first reason is that Microsoft hides the source code which has the benefit for the competitor because it cannot copy the code. The second reason is that Microsoft separates the price of the product into two groups of consumers, which are the programmers and the common users. Microsoft also provides the lower price than Read Hat Linux, from this reason; it causes Microsoft gets the higher profit that the Red Hat Linux. The last reason is that Microsoft also provides the technical support to the users with no cost. In conclusion, Microsoft’s products will be easier to be sold because the numbers of common users are more than the numbers of programmers. So, Microsoft’s business model is better than the Red Hat Linux’s business model. Michael E. Porter

Michael E. Porter was born in 1947, and he is a leading authority on competitive strategy, the competitiveness and economic development of nations, states, and regions, and the application of competitive principles to social problems such as health care, the environment, and corporate responsibility. He is generally recognized as the father of the modern strategy field, as has been identified in a variety of rankings and surveys as the world’s most influential thinker on management and competitiveness. The Porter's Five Forces

The Porter's Five Forces is a tool that is a simple but powerful tool for understanding where power lies in a business situation. This is very useful because it can help you to understand both the strength of your current competitive position, and the strength of a position you're considering moving into. This tool is very clear understanding of where power lies; you can take fair advantage of a situation of strength, improve a situation of weakness, and avoid...

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