More timeline thinking. I don't think Open Source Software like Linux will compete with Longhorn(the next MS operating system)... in the short run. I was working with some email filtering today and instead of creating a folder with files in it. I set up folders in Outlook and attach files to email that I send to myself. That way you have information folders that aren't just files. You have emails as well as data files all in the same place. That is what MS wants to move towards with its new OS. Open Source will pounce when computing matures. Microsoft R&D is just paving the way for it's competition.
BirdsEye invented the frozen foods industry in England. They installed freezers in most of the shops which was very expensive but necessary to complete their vision. Unfortunately, they weren't counting on a bunch of startups who quickly moved in and started using the freezers that BirdsEye had payed for. Microsoft is the BirdsEye of technology, the freezer installation is happening now with the development of Longhorn.
Open source thought number 2. People are willing to pay for software if it is better than the free alternative. That seems obvious but a lot of people don't look at the Total Cost of Ownership.