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Microsoft to Sell PCs, Starting in India
kripkenstein writes "According to an Ars Technica report Microsoft will begin selling complete PCs, for the first time in the company's history. The program is aimed at customers in India. 'Dubbed the IQ PC, the machines will cost RS21,000 (about $525), are manufactured in partnership with Zenith, and will sport AMD Athlon CPUs. ... In some ways, the move to sell hardware is a natural extension of Microsoft's low-cost Windows initiative ... It may also be a response to projects like Intel's Classmate PC and the OLPC XO.' The Ars Technica summary is careful to state that they seriously doubt this will lead to Microsoft selling PCs in the US, yet the question must be asked: After Microsoft mice and keyboards, then the XBOX and Zune, Microsoft is increasingly becoming a hardware vendor. Is it only a question of time before Microsoft starts to compete directly with the likes of Dell and HP?"
Sun and Apple have made quite a good bit of business with this model. I am more surprised that Microsoft did not try this years ago.
Bearded Dragon
For Years Microsoft has been neutral to OEM's. Could this move drive a further wedge between leading PC vendors and MS?
Is it a sign that Microsoft understands it cannot require OEM's to stop from selling alternate OS's and must enter the PC market itself?
Or is MS just licensing its brand name to go on the outside of the computer and making money for very little cost (something MS is good at)?
Will this prompt the big manufacturers to ship more Linux PCs?
The natural suspicion is that this will eventually lead to whole PCs elsewhere in the world and not for just academics/students. Long term Dell, Gateway and the crowd should be eyeing this carefully I should think.
The writers may doubt it, but even in the FA "..if Microsoft sees success in India, similar partnerships may be forged in other emerging markets".
They're not competing with Dell and HP. They'd be competing with APPLE. They could sell hardware AND software, but without the Apple lock-in, and (hopefully), without the Apple price. If they can keep the quality up (like they do with their keyboard and mice), they should do well.
Nobody wants to be in Dell's position. Dell has a very precarious business (tiny margins and very dependent on just a few vendors). HP is just a mess these days, so I can't even guess what their core competencies are any more.
I don't respond to AC's.
It's simple, really. If the market doesn't see software as a product, but rather sees software as inseparable or an ephemeral customization of the hardware "appliance," then the only way to make a profit on software is to bundle it and make profits on the hardware it's installed.
Rarely do people copy a completed MS Word installation from one machine to another. They copy an installer. If there's no installer, there's one piracy vector down. If all the machines have equal deployed software images, that's another piracy vector down. However, if all the machines are alike, but some don't come with the Office and some do, will they start to copy those post-install files and try to get them to work anyway?
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Given that Dell has started selling Ubuntu, and Intel has written real OSS 3D drivers for it's hardware (along with decent wifi drivers, making laptop support trivial for many, many people) maybe they think that any goodwill which previously kept them out of the hardware business is no longer an issue.
Think of the Children; Sleep with your Sister
I believe that's called "growing".
I believe they call that, "Flailing."
Like a whale on the beach.
Microsoft is to software what Budweiser is to beer.
This programme has most probably nothing to do with Microsoft selling hardware, but rather Microsoft trying to muscle in on the extreme low end market before it grows so big and full of low cost Linux machines that Microsoft has no chance. Microsoft will most likley use these lowish cost machines plus Vista starter edition (plus bucket loads of arm twisting, bribes and plain threats) to get authorities in developing country to stick with Vista Pirated Edition, since that is what will happen with the machines 5 minutes after they're powered on in any case. Microsoft is not going after Dell, Lenovo, or HP just yet.
However, Microsoft, you can bet your sweet fat arse, would love to build its own machines, so as to especially attempt to beat Apple at its own game of hardware/software integration. This is obvious. Vista copied so many features out of OSX (yay transparent windows and shadows, the calender, Windows Mail instead of Outlook Express, the gadgets in the sidebar, UAC and numerous things) in a transparent attempt to stop users drifting away from MS crapware to Apple. Microsoft entered the portable music player market ONLY because Apple was laughing so hard at Bill Gates every time he started up some new version of MSN music, claiming it would be an iPod killer. The zune may be a joke, but you can bet that MS will work on improving it to try and get it ready for the legendary 3rd revision, by which time MS products are expected to be better than the competition.
You can bet Micrsoft would build its own PCs in a heartbeat to counter Apple if it could. MS is scared silly by Apple. The iPhone is not going to help the fear in Redmond much either, because it is guaranteed to be a huge success compared to MSs Dumbphones. Expect MS to dump HTC and release its own phone in about two or three years.
The only thing stopping MS from making its own PCs is the fact that that is honestly, the only real MS success story. Windows, Office and the Server Windows is where MS makes its money. If MS were to frolic too hard with making its own PCs in the US and Europe, you can bet that Linux would be on the front page of HP and Dells sites tomorrow and that you would have to actually look at who would sell you Windows anymore. (Yes, I'm exagerating, but the OEMs will become OELinux pretty soon, since they would not be able to compete with MS.)
MS would stand to lose vast amounts of marketshare, and they'd still lose, beause no matter how well their machines sold, Apple, in a tight corner, would only have to start selling OSX to OEMs to really bust Redmonds balls.
(rereading this, I wonder just how desperate Ballmer and Bill the dweeb really are?)
I'd say it's too high by $100 or so... $525 isn't exactly a low-end price for a computer, even in the US.
If they can start selling enough pcs to take over the market, they can get rid of all those pesky resellers that always want discounts, and try to sell 'bare' hardware against Microsoft's wishes.
If they are the only game in town, you cant avoid the microsoft tax..
---- Booth was a patriot ----
LG, to give a brand name more people recognize, is Philips. The game just changed in a big way.
The rest of the top 10 OEMs will not take this lying down. That was their market, and Microsoft was not welcome to it. Microsoft is taking the bread off their table. The objective of this "pilot project" is nothing less than to capture the entire emerging PC markets of India and China, between them nearly half the world's populace. There will be repercussions. As long as Microsoft stayed out of PC OEM land, everybody else was content to play their game. Now it is clear they will not be content with less than Microsoft Brand breakfast cereal. They will not honor the common principles of capitalism - including the commandment in my subject.
Microsoft has treated OEMs like they're sharecroppers on the field of IT, to plough and plant the field and subsist on the gleaning for too long. In boardrooms across the world this is being discussed, and it won't fare well for Redmond.
The top 10 are: HP, Nokia, Dell, Samsung, Sony, Motorola, Siemens, Toshiba, LG and Apple.
Personally I think this is a good thing. Nothing, and I really do mean nothing, could increase uptake of GNU/Linux more than this. It was time everybody knew where Microsoft stood: at the height of hubris.
Help stamp out iliturcy.