Linked by Thom Holwerda on Tue 9th Oct 2012 22:01 UTC
Microsoft Steve Ballmer's annual letter to shareholders makes it very clear Microsoft is at a point of no return - and in the middle of a transition into a hardware company. "This is a significant shift, both in what we do and how we see ourselves - as a devices and services company. It impacts how we run the company, how we develop new experiences, and how we take products to market for both consumers and businesses." Line. Sand.
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RE[3]: OEMs deserve to suffer
by kaiwai on Wed 10th Oct 2012 05:06 UTC in reply to "RE[2]: OEMs deserve to suffer"
kaiwai
Member since:
2005-07-06

I don't think Microsoft have a reason to be more involved in PC hardware. They already control the most relevant standards (e.g. ACPI) and also have a "Windows Logo Program" to entice hardware manufacturers to do what Microsoft wants.


ACPI isn't a comprehensive standard so I wish people would stop chanting these acronyms as if they were complete standards and only if the OEM's actually stuck to them we would have nirvana. The reality is that these standards are deliberately designed in such a way that leaves holes open for vendor differentiation hence the reason why vendors provide ACPI drivers for their computers.

The "fundamental shift" they're talking about is smart phones, tablets, x-boxes, TV/media centers, etc; with hardware probably manufactured by other companies in partnership with Microsoft (and sold with Microsoft's branding, software, vendor lock-in, etc).


Or the a close relationship as with the case of Microsoft and Nokia but I could see a conflict brewing when it comes to services on top where Nokia will want their share of the pie and Microsoft equally preferring that their platform is being used to access Microsoft services rather than the handsets own.

The other part of it is likely to be making consumers pay for "cloud", and tying all these devices into an app store model (where Microsoft get a percentage of all third-party software sales).


The percentage they receive is small when compared to what it needs to pay for - even Apple which runs on the smell of an oily rag isn't exactly rolling in the cash off the back of the 30% cut. The cut they receive pays for the reviewing process, the data-centres and maybe some of the operating system development costs but I don't see it being a big money spinner.

As for the renting applications model - they've tried it multiple times and each time the consumer rejects it even if over a three year cycle the subscription works out cheaper. People like to be in control of their purchasing and they don't want to feel as though they're being forced into anything thus Microsoft has continued to sell Microsoft Office 2013 permanent licence. End of the day as I've said the best thing Microsoft can do when it comes to services is sell value added services on top of their traditional software licenses because long term I simply don't see customers happy to pay a per monthly basis for their software in the same way that people are happy to pay for cloud storage or exchange service (which is what I'm paying for right now).

Basically, make sure Microsoft get a good percentage of the initial hardware sale, then make sure Microsoft get a good percentage of everything after that, then make sure the devices are useless if consumers realise their wallet is being sucked dry. :-)


Or they could go the third option and start selling the tablets through carriers - I know in New Zealand Telecom seems to be quite happy to see tablets at subsidised prices on 12 and 24 month contracts and Vodafone did the same thing with netbooks with 3G devices.

Edited 2012-10-10 05:07 UTC

Reply Parent Score: 4

RE[4]: OEMs deserve to suffer
by 1c3d0g on Wed 10th Oct 2012 05:52 in reply to "RE[3]: OEMs deserve to suffer"
1c3d0g Member since:
2005-07-06

On your point about Nokia, that's not a problem, M$'s got all the money in the world to make any merger or acquisition necessary with that company.

Reply Parent Score: 2