Why the Wal-Mart "snub" should be a big deal for gOS

Why the Wal-Mart "snub" should be a big deal for gOS

Summary: My blogging colleague Dana Blankenhorn reports that ThinkgOS founder David Lui isn't worried by the Wal-Mart snub. He should be.

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My blogging colleague Dana Blankenhorn reports that ThinkgOS founder David Lui isn't worried by the Wal-Mart snub.  He should be.

gOSHere's what Lui had to say:

"It sounds like a big story but it’s not that big a story. Right off the bat we were telling people what we were doing was creating a concept. We knew we were targeting a tech-savvy crowd. The customers Wal-Mart has in the stores are our ultimate vision. We learned a lot, but we felt it was only a soft launch."

There are a few contradictions in that statement alone.  First, I accept that gOS is a concept that's aimed at tech-savvy users, but in that case I can't understand why the company targeted Wal-Mart customers.  There are far better ways to go about getting the attention of tech-savvy users. 

Also, going for a Wal-Mart soft launch just doesn't make sense.  As a rule Wal-Mart doesn't do soft launches because devoting shelf space to stuff that's hard to shift means losing money, and Wal-Mart didn't get where it is today by devoting space to soft launches.

However, I do feel that Lui has hit the nail on the head with this statement:

"Making money from a $199 PC is very difficult. The margins are very small. The margin on a $399 PC is three times that – you have to sell three times as many units. It doesn’t add up."

Well there's your problem!  As much as I love getting cheap hardware, you have to be careful how far you drop the price.  Dell over the years has dropped the price of PCs so much that the company devalued the budget PC market so much that it became hard for any company to make money selling cheap PCs.  This in turn put pressure on vendors to rake a profit off the other end of the market - the high end gamer and enthusiast market (oh, and businesses ...).  Cheap hardware doesn't leave much of a budget for things like marketing.  Some products don't need marketing, but others do, and it seems that a $200 PC needs a certain level of marketing and consumer education than the profit margins can't accommodate.

So, why should the Wal-Mart's statement that Linux PCs "wasn't what our customers were looking for" bother gOS?  Well, here's what that means to me - you can take a PC (a pretty decent PC, ideal for your average home user not into gaming or media center stuff), load a Linux distro on it, sell it at a price that's practically giving it away and then put that PC on sale in a store where customers are traditionally thought of as looking for bargains, and that PC turns out to be not what the customers want.  This experiment gone bad won't be remembered as "Linux-based Everex PCs didn't sell in Wal-Mart stores" or "it was a soft launch and that's why Wal-Mart pulled the plug on it."  No, it'll be remembered as a Linux failure, and that's a shame. 

There seems to be a rush to get cheap Linux PCs to market and I can't shake the feeling that this isn't good for Linux. 

Thoughts?

Topics: Software, Hardware, Linux, Open Source, Operating Systems

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30 comments
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  • Is this thing on??

    Were are all of the MS bashers now? Or are they Linux backers? I thought there would have been a ton of feedback as Wal-Mart is eaily as "evil" as MS is.
    spidermac
    • They weren't left on the shelves

      and the return rates were very low. Go figure.
      fr0thy1
    • WalMart IS as Evil as MicroShaft - That's Just an Undisputed Fact

      OTOH, selling $199 Linux deskops - in WalMart? That's just stupid.

      I love Linux as either a free (as in beer and speech) "Web/E-Mail/Word Processing Appliance" for beginning users, or as a stable secure OS for geeks and networking. But there's a BIG in-between market that M$ serves with a lot of known software - not well, but just well enough that most regular people don't seriously consider switching. Linux isn't a good first or even second computer for Joe & Jane Six-Pack - though thanks to Ubuntu and Xandros on ASUS's EEE PC, it's shaping up as a nice travel and houseguest OS....

      Until some Linux GUI distro comes out w/out-of-the-box
      commercial DVD playback, iTunes and the ability to install rather than compile all available software, Linux will be limited in its market share.
      drprodny
      • well, your statement was proven wrong...

        I quote: "Until some Linux GUI distro comes out w/out-of-the-box commercial DVD playback, iTunes and the ability to install rather than compile all available software, Linux will be limited in its market share."

        Well, the gOS came with DVD playback capabilities out of the box, iTunes doesn't exist for Linux but I would dare say that Rhythmbox is actually easier to use than iTunes, and now only Gentoo users compile their software - in fact Linux is more modern than either Windows or MacOS as any software you want to install is through a point and click interface.

        So, I guess there was some return from people not able to read a label but knowing about Windows, but others must be happily using it as an Internet appliance, yet Wallmart felt those returns on a low margin device were too much.

        If, on the other hand, stores could sell more Linux stuff like a cheap desktop, a low-cost laptop etc. in a separate aisle, with software (different Linux distros, StarOffice boxed sets etc.), then maybe it would work better.
        Mitch 74
  • Wrong offer

    Wal-Mart (and other companies) should not sell a PC as a Linux machine. They should have an option to sell the PC: 1) without OS, 2) a Linux distro, 3) Windows XP and 4) Windows Vista.

    The user would choose the model and the OS.

    Along with the boxes he would be given a DVD with an image of the selected OS (or none), ready to run on the selected model with all drivers.

    He would then pay according to the price of the hardware and the OS (some fee could be charged for the Linux configuration)

    Just my 2cents...
    plino
    • good idea

      but my guess is, they will buy option 3 or 4.

      The problem is, most people who shop at Wal-Mart for a PC are looking to buy something they are familiar with. I don't think you could convince them to buy a Linux machine, or one without an OS. They'd be more likely to buy a Mac as an alternative.
      Badgered
      • GREAT! Provided WalMart could sell a sub-$500 Mac

        Which is sadly NOT going to happen, at least not in this lifetime. I had hopes with the Mac Mini, but it's too limited and too unavailable outside of Apple channels.... :(
        drprodny
  • Preinstalled OS

    Indeed the targeted group for this PC (people with virtually no understanding of computing), is unaware of the advantages. Due to lack of comprehension. A pity, but there it is.

    The real growth of Linux will come about, when *all* PC's and laptops will be sold with the *option* to have no operating system (or any other software) preinstalled on them. Then another customer group will switch to Linux, in growing numbers: Windows users who have a good understanding of computing.

    The most important obstacle yet to erase is therefore the tie-in sale of PC's and laptops with preinstalled Microsoft software. To end this tie-in sale, we'll probably need legal action. That shouldn't be too hard to do, because package deals like this are essentially anti-capitalistic and pro-monopoly.

    Greetz, Pjotr.
    pjotr123
    • I disagress

      [i]"The real growth of Linux will come about, when *all* PC's and laptops will be sold with the *option* to have no operating system (or any other software) preinstalled on them."[/i]

      Linux will always be for techie and power users. The creative types have Mac and OSX and for the great unwashed there will always be Windows.
      bportlock
      • Oops!!

        Got my fingers muddled on that last title - should have been "I disagree"

        :-O
        bportlock
        • you had a lolcat moment there. [n/m]

          .
          lostarchitect
          • More than one I think! (nt)

            .
            bportlock
          • "Your Disagrees - Let Me Show You It"

            Mew!

            ;)
            drprodny
    • As a PC OEM ....

      .... We can configure our hardware with any OS or no OS. There is nothing illegal about it. People will switch in mass to Linux when pigs fly!
      ShadeTree
      • The critical mass

        argument holds true, but there is the problem of lots of Windows only know-nothings passing themselves off as technical people. OEM's etc are full of them.
        fr0thy1
        • hear hear

          its scarey out there for the unknowing Joe Bloggs .....
          deaf_e_kate
        • Well, Windoze Know-Nothings like Shade are NOTHING New

          Just like Faux Noize Right-Wing Talk Radio "pundits" are nothing new. Wasn't there a "know-nothing" political movement in the early Nineteenth Century? Shade, Ax [i]et al[/i] are obviously reincarnations of those yoyos.... :p

          OTOH, Linux is still too hard for so-called "normal people" - at least once you venture outside the limited application sphere of Web surfing, e-mail and simple office apps that Open Source has successful versions of. I know creating Linux versions of popular Windows apps like iTunes and DVD players (not "just like iTunes" - actual iTunes for Linux!) are technically doable - now we just need some people (probably working for Mark Shuttleworth?) to make it legally and politically doable as well.
          drprodny
    • You fight the power!!!

      Personally, I tend to like certain package deals. I don't mind buying a car with tires. Occasionally when I buy a lawn mower, I like to have the engine included.
      And if I buy a used house, I really don't want to have to buy the windows separately.

      I guess I could purchase an operation without the anesthesia. I don't know if I would recommend that though.
      nucrash
  • Sales require customer knowledge

    Wal-Mart sold their in-store inventory in about two weeks and didn't restock them. Several months later, Wal-Mart decides that they aren't selling well because nobody is buying them from their stores.

    Perhaps, just perhaps, they might have sold more if there had been any on the shelves for people to see. Far be it from me to have the gall to remind any retailer, much less Wal-Mart, that nobody is going to buy what they don't know about.
    Letophoro
  • Not the first Walmart PCs with Linux

    The Everex PCs with gOS are not the first PCs with Linux Walmart has attempted to sell. A few years ago they were trying to sell PCs preloaded with Linspire, or maybe it was Lindows back then.
    hgh9mrp9