Microsoft – Lose lose

Making Windows Phone and RT free is pointless.

• The latest notion to come from the re-organisation of Microsoft is the idea that reducing Windows Phone and Windows RT royalties to zero will somehow boost support for the platform.
• I am sure that this idea has occurred to Microsoft but I think it very unlikely to ever see the light of day.
• This is because it will not benefit the company or the platform and only increase the risk of pricing pressure on its core products.
• I have two reasons for this view.
  • First. Windows Phone and Windows RT have no meaningful volume outside of Microsoft and Nokia.
  • Hence, if Windows Phone and Windows RT were to become free, it would benefit no one.
  • Second. No-one outside of Microsoft / Nokia wants to make Windows Phone or Windows RT devices.
  • Furthermore, this lack of OEM support for Windows Phone and Windows RT has nothing to do with price.
  • In the case of Windows Phone, no one supports it because supporting Windows Phone now means that one would become dependent on a competitor for one’s technology.
  • The long saga of Symbian clearly shows that a set up where a handset maker licenses its software to its competitors will fail no matter what precautions are taken to maintain independence.
  • In the case of Windows RT, no one supports it because consumers have universally shunned the platform and making devices based on it has only lead to massive losses. (see here)
  • This is why I suspect that the Nokia 2520 and Windows Surface 2 will be showcase products only and no real volumes will be manufactured. (see here).
  • These issues have nothing to do with price and therefore reducing the royalties to zero would in no way resolve them.
• There is also added risk of reducing prices on software that is closely related to Windows 8.
•  This would be a chink in the armour of Windows pricing that is been pretty firm for many years.
• Microsoft has gone to great lengths to preserve its ability to charge royalties on the software it provides for mobile devices (see here).
• There is no reason for it to change that as the result to me looks like a lose lose.