Windows has been over priced since windows Vista. It is about time. Maybe Microsoft is finally getting it. Apple gives it's operating system away with any new mac and all upgrades are free. Maybe Microsoft is getting the hint.
As I see it though, Googles problem exactly is what you say (my input in brackets) . .... "why? Because they (Google) already make the lion's share of (their) advertisement dollars on the desktop."
The 'desktop' and it's earning potential for Google's business model is only on the web, html, port 80 and all that good stuff. Meanwhile, Apple with the lions share of internet mobile traffic by a massive majority, bypass the web entirely other than for Safari usage and even then without Flash. Almost everything else uses the internet without traditional web browsing. That's what Apple's mobile Apps are all about. That is the paradigm shift Steve initiated and no one saw coming ( remember Apple being laughed at for dropping Flash and starting their own iOS ad system for app developers) . Google are effectively shut out of the mobile market. Of course they have a gazillion Android bits of junk out there but no one uses them on the internet it would seem from all the data.
Except you're forgetting that Google owns admob and that's still used by many developers for in app advertisements. BTW the iPhone was originally meant to run web apps, SJ had to be convinced to allow apps to be written for the OS and installed directly onto the device.
The answer is 0 if the market you are selling to has not been addressed yet by Microsoft. I would guess that this is the same price Microsoft is getting for Android on ARM. This move is actually the first real breath of air back into the Wintel partnership which used to own technology, but missed the shift to mobile due to arrogance rather than good business sense. Marginal costs on software are always zero. This does not mean that replacement costs are zero, but given a business environment where someone else is already offering a replacement for your simplest systems at the $200 price point, then you have nothing to lose except percieved value of the higher priced Windows. For this strategy to work, Intel will have to have a $30 system on a chip solution to match Microsoft's less expensive software. The problem over the long term for the higher priced Windows is not trivial. It is not without precedent. The server version of Windows is an order of magnitude more expensive then the individual software licenses.
Windows has been over priced since windows Vista. It is about time. Maybe Microsoft is finally getting it. Apple gives it's operating system away with any new mac and all upgrades are free. Maybe Microsoft is getting the hint.
Yeah because Apple makes macs and they're certainly not free. Different business models. Honestly, MS should be less concerned about Windows everywhere (which is what Windows 8 was all about), and more concerned about being a great services company. I think it's a mistake for MS to try and be both vertical and horizontal at the same time. Forget about hardware, just make your services best in class and available on all platforms.
Years of selling to a captive market, without admitting to yourself that you're selling to a captive market or understanding what that means, is what's killing Windows and Microsoft. Only when viable competition came along did they realize that they've lost (or never had) the capability to build a true, world-class OS. One that customers CHOOSE to buy not HAVE TO buy. How Microsoft will rescue Windows is a monumental, probably impossible task, because their whole OS engineering, design, and marketing staff never had to develop the ability to discern what does and doesn't appeal to the customer. Exhibit A on that: Windows 8.
Monopoly is like heroin, it might make you feel good at first use but it'll kill you in the end.
Years of selling to a captive market, without admitting to yourself that you're selling to a captive market or understanding what that means, is what's killing Windows and Microsoft. Only when viable competition came along did they realize that they've lost (or never had) the capability to build a true, world-class OS. One that customers CHOOSE to buy not HAVE TO buy. How Microsoft will rescue Windows is a monumental, probably impossible task, because their whole OS engineering, design, and marketing staff never had to develop the ability to discern what does and doesn't appeal to the customer. Exhibit A on that: Windows 8.
Monopoly is like heroin, it might make you feel good at first use but it'll kill you in the end.
I think it is Steve Jobs that saw a lot of PC users really don't need a bloated PC that can run everything and very powerful. Google follows Apple closely. They understand where Jobs is leading Apple to. So Google develop an OS that mostly just run a browser.
Wasn't Linux making its way into the PC market when netbooks first came out? Didn't Microsoft re-release Windows XP and drop the price to push back Linux?
A Chromebook is nothing more than a repurposed netbook that's even more limiting in its capabilities. They'll die faster than netbooks did. There's no reason for Google to develop a desktop OS, why? Because they already make the lion's share of advertisement dollars on the desktop.
Microsoft needs to drop "Windows Everywhere" and follow Apple's playbook, write a separate OS that works for mobile.
"Microsoft needs to drop "Windows Everywhere" and follow Apple's playbook, write a separate OS that works for mobile."
I agree, and the sad thing is they already had that with Windows Phone. All they had to do was take a page out of Apple's playbook and have Windows Phone OS for smartphones and tablets and leave Windows 8 (without Metro UI) for traditional PC's. They wouldn't have as much backlash as they do now.
"Microsoft needs to drop "Windows Everywhere" and follow Apple's playbook, write a separate OS that works for mobile."
I agree, and the sad thing is they already had that with Windows Phone. All they had to do was take a page out of Apple's playbook and have Windows Phone OS for smartphones and tablets and leave Windows 8 (without Metro UI) for traditional PC's. They wouldn't have as much backlash as they do now.
MS has always been focused on enterprise. Many people bought Windows PCs for their home because they were already familiar with it from using them at work. With Apple targeting the consumer so successfully, MS didn't want to miss the opportunity for a slice of that market, but they are just not consumer friendly.
MS should stay focused on enterprise like Oracle does. They could certainly make a lot of IT departments happy if they cut the price of Windows 7 Professional in half.
I recently built a custom computer for a new member of our office. I installed Win 7 Pro which is a pretty decent OS so long as the end user doesn't have to do a lot of interaction at the OS level. By this, I mean, once you are in your application window everything goes fairly smoothly.
Windows itself is just not as polished as OS X. One example of Windows clunkiness is searching. It is slow and often doesn't find stuff that is actually there. OS X has awesome searching capabilities. Another example I ran into which demonstrates the lack of polish was loading fonts. From the OTE font folio there are read me files in the folders. If you select all then right click to install the fonts it generates an error because the read me file is not a font. Conversely on OS X if you do the same thing it just ignores the read me file because it knows it is not a font. That is the elegance of OS X.
A Chromebook is nothing more than a repurposed netbook that's even more limiting in its capabilities. They'll die faster than netbooks did. There's no reason for Google to develop a desktop OS, why? Because they already make the lion's share of advertisement dollars on the desktop.
Criticising Chromebooks for being 'limited netbooks' is like criticising tablets or feature phones for being 'limited smartphones' - it misses the point of the devices. They're targeted specifically at the people who neither need nor want extra capabilities - the people for whom a phone is just a phone, and a desktop is just a means to check your email and write documents. And because they're designed to do so much less, they tend to do a very good job of it.
Just because you see a laptop or a mobile device as being more than just a browser or a word processor or a telephone doesn't mean that everyone does.
Extremely bad news for Microsoft, considering licensing with how they make a bulk of their profits. How will MS make up for this? Volume? Hardware? Doesn't look like they've gotten much traction there.
And that is why (and I know people who want Microsoft to fail would rather not see this) building $499 PC's with no crapware and Windows 7 is what Microsoft should encourage. Most big vendors do not do that, it is either Windows 8, crapware loaded or weak. But paying Microsoft $90 wholesale for Windows 7 makes it turn into a $599 PC that sells less.
Sure, Apple is better, for sure in software, often in hardware. I admit that. But a properly setup quad core 8gb/1TB Windows 7 machine with passwords and non-admin user accounts is not bad. Microsoft has a unnatural want to sell Windows 8 when they make just as much or more on Windows 7. This is when the PR/marketing department has more weight then the accounting department.
Microsoft has to sell Windows 8. I think Microsoft has redesigned applications like office amongst others in the spirit of the Windows 8 Metro UI. I guess the idea is to have the same UI on desktops, Tablets and Phones. That makes it more difficult for MS to change all these user interfaces if they wanted to. I think the Office interface is slow and confusing. Office still rules but it is being challenged. This could be deadly for Microsoft.
Apple's not involved in this story. This story is about sub $250 systems, and about Google borrowing a page from the 1990s MS playbook:
In 1994 Microsoft used its profitability in other areas (OS) to kill Netscape.
In 2014 Google used its profitability in other areas (search) to kill Microsoft.
Schadenfreud-licious.
Why it's not about Apple: Apple doesn't give away iOS and OSX for free to gain incremental marketshare in a low-cost segment: the most recent iOS and OSX versions have been free because they have included features to tightly integrate the data-sharing for a common userid, thus ensuring we will continue to buy Apple hardware (iphones, iPads, macs). As others have noted, Apple's core profitability is in hardware; the money-making machine of iTunes and other software/services have much lower margins.
<span style="line-height:1.4em;">A Chromebook is nothing more than a repurposed netbook that's even more limiting in its capabilities. They'll die faster than netbooks did. There's no reason for Google to develop a desktop OS, why? Because they already make the lion's share of advertisement dollars on the desktop.</span>
Criticising Chromebooks for being 'limited netbooks' is like criticising tablets or feature phones for being 'limited smartphones' - it misses the point of the devices. <span style="line-height:1.4em;">They're targeted specifically at the people who neither need nor want</span>
<span style="line-height:1.4em;"> extra capabilities - the people for</span>
<span style="line-height:1.4em;"> whom a phone is just a phone, and a desktop is just a means to check your email and write documents. And because they're designed to do so much less, they tend to do a very good job of it.</span>
<span style="line-height:1.4em;">Just because you see a laptop or a mobile device as being more than just a browser or a word processor or a telephone doesn't mean that everyone does.</span>
You make a great case for getting into the flip phone and netbook market. Not sure it's a wise business move however. Ask Nokia and Acer.
So can someone explain how lowering the OEM license fee by 70% will help sell stuff that apparently few people actually want as it is?
Also, the bloat ware that comes installed on most if not all PCs is one of the main reasons why PCs have been relatively cheap. The bloat ware helps subsidizes the price so don't expect to see it disappear any time soon
Comments
Windows has been over priced since windows Vista. It is about time. Maybe Microsoft is finally getting it. Apple gives it's operating system away with any new mac and all upgrades are free. Maybe Microsoft is getting the hint.
Except you're forgetting that Google owns admob and that's still used by many developers for in app advertisements. BTW the iPhone was originally meant to run web apps, SJ had to be convinced to allow apps to be written for the OS and installed directly onto the device.
The answer is 0 if the market you are selling to has not been addressed yet by Microsoft. I would guess that this is the same price Microsoft is getting for Android on ARM. This move is actually the first real breath of air back into the Wintel partnership which used to own technology, but missed the shift to mobile due to arrogance rather than good business sense. Marginal costs on software are always zero. This does not mean that replacement costs are zero, but given a business environment where someone else is already offering a replacement for your simplest systems at the $200 price point, then you have nothing to lose except percieved value of the higher priced Windows. For this strategy to work, Intel will have to have a $30 system on a chip solution to match Microsoft's less expensive software. The problem over the long term for the higher priced Windows is not trivial. It is not without precedent. The server version of Windows is an order of magnitude more expensive then the individual software licenses.
Monopoly is like heroin, it might make you feel good at first use but it'll kill you in the end.
This article is not very informative. What is the Google PC share?
Years of selling to a captive market, without admitting to yourself that you're selling to a captive market or understanding what that means, is what's killing Windows and Microsoft. Only when viable competition came along did they realize that they've lost (or never had) the capability to build a true, world-class OS. One that customers CHOOSE to buy not HAVE TO buy. How Microsoft will rescue Windows is a monumental, probably impossible task, because their whole OS engineering, design, and marketing staff never had to develop the ability to discern what does and doesn't appeal to the customer. Exhibit A on that: Windows 8.
Monopoly is like heroin, it might make you feel good at first use but it'll kill you in the end.
I think it is Steve Jobs that saw a lot of PC users really don't need a bloated PC that can run everything and very powerful. Google follows Apple closely. They understand where Jobs is leading Apple to. So Google develop an OS that mostly just run a browser.
That sounds familiar...
Wasn't Linux making its way into the PC market when netbooks first came out? Didn't Microsoft re-release Windows XP and drop the price to push back Linux?
A Chromebook is nothing more than a repurposed netbook that's even more limiting in its capabilities. They'll die faster than netbooks did. There's no reason for Google to develop a desktop OS, why? Because they already make the lion's share of advertisement dollars on the desktop.
Microsoft needs to drop "Windows Everywhere" and follow Apple's playbook, write a separate OS that works for mobile.
"Microsoft needs to drop "Windows Everywhere" and follow Apple's playbook, write a separate OS that works for mobile."
I agree, and the sad thing is they already had that with Windows Phone. All they had to do was take a page out of Apple's playbook and have Windows Phone OS for smartphones and tablets and leave Windows 8 (without Metro UI) for traditional PC's. They wouldn't have as much backlash as they do now.
What was Windows CE then?
MS has always been focused on enterprise. Many people bought Windows PCs for their home because they were already familiar with it from using them at work. With Apple targeting the consumer so successfully, MS didn't want to miss the opportunity for a slice of that market, but they are just not consumer friendly.
MS should stay focused on enterprise like Oracle does. They could certainly make a lot of IT departments happy if they cut the price of Windows 7 Professional in half.
I recently built a custom computer for a new member of our office. I installed Win 7 Pro which is a pretty decent OS so long as the end user doesn't have to do a lot of interaction at the OS level. By this, I mean, once you are in your application window everything goes fairly smoothly.
Windows itself is just not as polished as OS X. One example of Windows clunkiness is searching. It is slow and often doesn't find stuff that is actually there. OS X has awesome searching capabilities. Another example I ran into which demonstrates the lack of polish was loading fonts. From the OTE font folio there are read me files in the folders. If you select all then right click to install the fonts it generates an error because the read me file is not a font. Conversely on OS X if you do the same thing it just ignores the read me file because it knows it is not a font. That is the elegance of OS X.
Redmond really needs to fix their copy machines.
A Chromebook is nothing more than a repurposed netbook that's even more limiting in its capabilities. They'll die faster than netbooks did. There's no reason for Google to develop a desktop OS, why? Because they already make the lion's share of advertisement dollars on the desktop.
Criticising Chromebooks for being 'limited netbooks' is like criticising tablets or feature phones for being 'limited smartphones' - it misses the point of the devices. They're targeted specifically at the people who neither need nor want extra capabilities - the people for whom a phone is just a phone, and a desktop is just a means to check your email and write documents. And because they're designed to do so much less, they tend to do a very good job of it.
Just because you see a laptop or a mobile device as being more than just a browser or a word processor or a telephone doesn't mean that everyone does.
Extremely bad news for Microsoft, considering licensing with how they make a bulk of their profits. How will MS make up for this? Volume? Hardware? Doesn't look like they've gotten much traction there.
And that is why (and I know people who want Microsoft to fail would rather not see this) building $499 PC's with no crapware and Windows 7 is what Microsoft should encourage. Most big vendors do not do that, it is either Windows 8, crapware loaded or weak. But paying Microsoft $90 wholesale for Windows 7 makes it turn into a $599 PC that sells less.
Sure, Apple is better, for sure in software, often in hardware. I admit that. But a properly setup quad core 8gb/1TB Windows 7 machine with passwords and non-admin user accounts is not bad. Microsoft has a unnatural want to sell Windows 8 when they make just as much or more on Windows 7. This is when the PR/marketing department has more weight then the accounting department.
Microsoft has to sell Windows 8. I think Microsoft has redesigned applications like office amongst others in the spirit of the Windows 8 Metro UI. I guess the idea is to have the same UI on desktops, Tablets and Phones. That makes it more difficult for MS to change all these user interfaces if they wanted to. I think the Office interface is slow and confusing. Office still rules but it is being challenged. This could be deadly for Microsoft.
Apple's not involved in this story. This story is about sub $250 systems, and about Google borrowing a page from the 1990s MS playbook:
In 1994 Microsoft used its profitability in other areas (OS) to kill Netscape.
In 2014 Google used its profitability in other areas (search) to kill Microsoft.
Schadenfreud-licious.
Why it's not about Apple: Apple doesn't give away iOS and OSX for free to gain incremental marketshare in a low-cost segment: the most recent iOS and OSX versions have been free because they have included features to tightly integrate the data-sharing for a common userid, thus ensuring we will continue to buy Apple hardware (iphones, iPads, macs). As others have noted, Apple's core profitability is in hardware; the money-making machine of iTunes and other software/services have much lower margins.
(reply to Slurpy) : Not really ...
Very interesting graph, which explains many things ....
Silly Microsoft. When will they learn that you get what you pay for? I'll stick with Apple, thankyouverymuch!
Also, the bloat ware that comes installed on most if not all PCs is one of the main reasons why PCs have been relatively cheap. The bloat ware helps subsidizes the price so don't expect to see it disappear any time soon
$1,000 market (Macs rule)
$300 - $999 market (Tablets)
$199 - $299 market (Tablets, Smartphones, Chromebooks)
Microsoft is getting hammered!