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Microsoft's New Windows Monetization Methods Could Mean 'Subscriptions'

SmartAboutThings writes Since the first version of Windows, Microsoft has offered the operating system on a initial fee purchase. But under new management, it seems that this strategy could shift into new monetization methods, a subscription-based model being the most probable one. At the recent Credit Suisse Technology Conference from last week, Chief Operating Officer Kevin Turner was speaking (transcript in Microsoft Word format) to investors about the fact that Microsoft is interested in exploring new monetization methods for its Windows line of products. The company might adopt a new pricing model for the upcoming operating system, as it looks to shift away from the one-time initial purchase to an ongoing-revenue basis.

34 of 415 comments (clear)

  1. I'm sorry by CrackerJackz · · Score: 5, Insightful

    I'm sorry, I don't rent my operating systems. Or my applications for that matter. Now get off my lawn. :)

    1. Re:I'm sorry by Virtucon · · Score: 3, Funny

      I'm sure they'll support the traditional model and maybe come up with a catchy edition title. For example they could label it 'New Windows' for the subscription model and 'Windows Classic' for the one model people are used too. Then of course they could come up with new editions like 'Windows Zero' or 'Windows Light' just to further confuse the marketplace.

      --
      Harrison's Postulate - "For every action there is an equal and opposite criticism"
    2. Re:I'm sorry by QuietLagoon · · Score: 4, Informative

      Looks like I'll now be holding on to my Windows 7 licenses as long as I can.

    3. Re:I'm sorry by Aeros · · Score: 2

      Dont give them ideas!!!

    4. Re:I'm sorry by bondsbw · · Score: 2, Insightful

      If it's anything like Office, they'll offer both subscription and up-front purchase.

      If they couple the subscription with the Office subscription at reduced price, while offering standard cloud services and perhaps even XBox Live membership, now that would be enticing.

      --
      All my liberal friends think I'm a conservative, all my conservative friends think I'm a liberal.
    5. Re:I'm sorry by BarbaraHudson · · Score: 4, Insightful

      Well. when you can't compete in the fast-expanding fields of tablets and smartphones, you've got to find ways to milk your "milch cows" even more. Even when over the long term it's bad for the cow.

      --
      "Transparent" is a shit show that trades on every stereotype going. A man in drag is NOT a transsexual.
    6. Re:I'm sorry by xaotikdesigns · · Score: 2

      I've always considered the Adobe suite to be overpriced. The $50 a month is a bit more than I'm willing to pay. Even the $20 for a single app seems a bit high for me.

      --
      XDInd
    7. Re:I'm sorry by chmod+a+x+mojo · · Score: 2

      $9.99 for PS and Lightroom ( if they still offer that "photographers" bundle ) is actually pretty decent, it ends up costing about the same over the course of several years as buying an upgrade, just on PS itself, without having to cough up the money all at once. As an added bonus if you don't need to use the applications for a while you can suspend the rental until you need them again, saving a fair bit of money over the lump sum payment.

      --
      To err is human; effective mayhem requires the root password!
    8. Re:I'm sorry by drakaan · · Score: 2

      They don't pay $4.00 for a cup of coffee. They *do* pay $4.00 for coffee-flavored steamed milk and other drinks with varying proportions of milk and coffee. Milk is expensive. Duh.

      --
      "Murphy was an optimist" - O'Toole's commentary on Murphy's Law
  2. Maybe they should focus on... by BladeMelbourne · · Score: 5, Interesting

    Maybe they should focus on reducing logging and fragmentation. I won't pay for such poorly written software again:

    http://i.imgur.com/Ulem4sP.png

    1. Re:Maybe they should focus on... by MightyMartian · · Score: 2

      Exchange always was a bloated monster, but it's quite ridiculous now. Our Exchange 2010 install which I did last year will be our last one.

      --
      The world's burning. Moped Jesus spotted on I50. Details at 11.
    2. Re:Maybe they should focus on... by admin7665 · · Score: 2, Insightful

      What a bunch of crap. Logging isn't a problem with Windows. You count as logging things like binary journaling and malware scans. If you don't want those, disable them and enjoy your unsafe workstation. Also, "fixing" things by removing logging is ridiculous - I wish my car had more info than "check engine" and I enjoy the fact that Windows (and pretty much all modern OSes) do. Now, get off my lawn, kid.

    3. Re:Maybe they should focus on... by yakatz · · Score: 2

      Not correct. You are referring to Mailbox Database log files (which are cleaned automatically on nightly backups).
      I am talking about performance counters, verbose SMTP logs and similar which Exchange 2013 has loads of.

  3. A black day indeed. by Fishchip · · Score: 4, Funny

    There goes all those torrents of 'WINDOWS 8 ULTIMATE X64 TIMMY EDITION FULLY ACTIVATED'.

  4. Wow... by Lab+Rat+Jason · · Score: 2, Interesting

    It's as if they are trying to boost linux downloads.

    --
    Which has more power: the hammer, or the anvil?
  5. Re:So Linux on the Destop supremacy? by Dins · · Score: 4, Insightful

    I'd switch right now except I'm a PC gamer. And while Linux gaming is coming along (what with Steam for Linux, etc.), Windows is still the PC gaming OS. Unfortunately.

  6. Consumers are cheap by r_jensen11 · · Score: 2

    Consumers are cheap - this is evidenced by the number of consumers who never install a new version of Windows on their computers. How will Microsoft get people to subscribe when they buy a new computer?

    Buy this new laptop for only $499!*
    *Plus recurring $10/moy payments for the remainder of the computer's life

    Yeah, that will sell like hotcakes....

    1. Re:Consumers are cheap by jules_d'entremont · · Score: 4, Insightful

      Buy this new laptop for only $499!* *Plus recurring $10/moy payments for the remainder of the computer's life

      Isn't that exactly how cell phones are sold?

    2. Re:Consumers are cheap by Richy_T · · Score: 5, Funny

      It will be "Freemium". $0 for the OS then extra for items as you need them:

      $5 Clippy
      $5 That search dog/Einstein/Whatever that was
      $10 Autumn leaves wallpaper
      $15 Turn off animated window effects
      $20 Control Panel with things named as you remember them
      $30 Remove Evony advertising from dialog boxes
      $60 Start menu

  7. Jumping to conclusions by Nethemas+the+Great · · Score: 2

    I find it highly unlikely that Microsoft would switch solely to a subscription model. There are any number of deployment contexts where machines spend their life not connected to the Internet. Not only would offline renewal be a customer service nightmare, the expense of operating it would negate any merit. Even if connected, many (most?) consumers, as well as many businesses would be highly adverse to switching from a capital purchase to a lease of their PCs.

    --
    Two of my imaginary friends reproduced once ... with negative results.
  8. They abandoned this already by Anonymous Coward · · Score: 4, Insightful

    Sounds like... Technet. They essentially had this. Maybe the price points were wrong for them, or they didn't like some of the details, but they effectively had a subscription service. They shut it down. I loved it when it was available - $250 a year for essentially 3-5 licenses of every OS version, plus tools, plus applications, plus 1-3 server licenses of each version of the server. Heck, at $350 a year I wouldn't have even blinked. But for some reason they couldn't just shut up and take my money.

  9. Counterpoint by Anonymous+Brave+Guy · · Score: 4, Insightful

    I'm sorry, I don't rent my operating systems. Or my applications for that matter.

    Neither do I. Ticking timebombs are a complete deal-breaker for me.

    However, I would seriously consider paying a reasonable recurring fee to fund continued updates for an OS that works well for me after some sensible initial period of free support, so that OS can remain useful for a very long time and continue to support backward-compatible functionality while still keeping up with necessary compatibility and security changes as the environment around it evolves.

    Personally, I value stability more than random changes in user interfaces, and nowhere more so than in my operating system. I hate the modern trend of pushing out unreliable compulsory updates every five minutes, which don't just fix bugs or close security holes but also introduce regressions, maybe completely change the UI, or even remove functionality.

    Windows has traditionally been a shining contrast to that, and Microsoft have put in a huge amount of effort over the years to support their software for much longer than most projects do. However, it was never really commercially sensible to expect the kind of effort to be made indefinitely by Microsoft when no-one is paying them anything extra for it. The result is turkeys like Vista and Windows 8, when apparently a lot of us were much happier sticking with XP or Windows 7.

    So, I'd rather see some open, transparent arrangement where you know how long you get free updates for with the purchase and then there is a straightforward arrangement for funding more, instead of moving to some sort of lock-in/subscription model as promoted by the likes of Adobe or the "your software is more than five minutes old so we won't support you any more" model as promoted by the likes of Apple, Google and Mozilla.

    --
    If you disagree, post your argument. (-1, Overrated) isn't your personal censorship tool for views you don't like.
    1. Re:Counterpoint by Mr+D+from+63 · · Score: 2

      If the price is right, and the service is right, someone will use it. I cringe at the ideal of my OS becoming deactivated because of some billing error. With most software, the thought a temporary shutdown isn't that scary, but with your OS, it is.

    2. Re:Counterpoint by fahrbot-bot · · Score: 2

      I think Microsoft sees that the RedHat model of machine subscriptions is lucrative, and wants to go with that.

      Ya, no. RedHat subscriptions and their (default) constant nagging is one reason I use Ubuntu / Mint or other Debian-based systems. Another is familiarity, but I'm actually not too old to learn new thing, just don't care to fix things that aren't broken. That said, Unity is an abomination and I'm leaning that way about Systemd, but am not willing to fight about it - yet.

      --
      It must have been something you assimilated. . . .
  10. Open Source is Winning by MarkvW · · Score: 2

    Adobe went subscription, and I'm done with them. If Microsoft does it, I'm done with them too.

    The next killer app is 3d printing & CNC milling software for the masses. If open-source takes that high ground, the dinosaurs are screwed.

  11. Full-circle by Anonymous Coward · · Score: 5, Insightful

    Back in the 70's, businesses used terminals hooked to servers using leased software with maintenance contracts. This was clearly a scam that generated unjustified profits for some corporate titans who were then free to be mediocre and not innovative.

    Along came guys like Jobs, Wozniak and Gates who took on that old system and trashed it by saying to small business "you can own your system, have full control of your data, and pay for your software only once". Using this model, they defeated to old corporate giants while competing against eachother and bringing the consumer innovation and value. Now that they have become the corporate titans with near a monoply grip on the market, they have seen what the old titans saw: to keep growing your profits and keep your shareholders happy when you already have essentially all the available customers, you must find a way to get more cash out of your existing customer base. SHAZAM! The old server/data model is re-marketed as a big white fluffy "cloud", and the old abusive customer-wallet-milking billing model is a "subscription". They are just counting on newer, younger useres not noticing that this is all the vary same rip-off that they once insisted was evil.

    Time for somebody new to come along and repeat the 70's with "you can own your hardware, control your data, and only pay once for your innovative software..."

    This would be great news for Linux and BSD if only their developers would stop trying to re-create Windows2000, stop trying to adopt every crazy new fad before first fixing the most basic usability hurdles that keep these things from taking over the desktop: Linux printing? (still a crappy joke most users cannot make work) Linux audio? (still a screw-up without a single standard LINUX API) Linux desktop use of files on a server or NAS? (still a mess with things like Nautilus not able to reliably do it, when it SHOULD be totally plug-and-play and access to such files from all apps should be just as if they were local). As long as it takes a "guru" to make LINUX or BSD do ANY thing a normal user would want to do, it's a mistake to be adding sugary glossy eye candy and new features no matter how much deveopers would prefer to be doing this.

  12. trust lost is difficult to regain by ChipMonk · · Score: 5, Insightful

    With the crazy UI shifts, the security debacles, the hunger for hardware resources, and the generally inconsistent (read: shitty) performance of the various Windows releases, Microsoft has made a lot more enemies than friends over the years. What's worse is that it took their Board of Directors so long to oust Steve Ballmer, who was at the helm during their "screw the customers" years.

    So now nobody likes Microsoft, nobody trusts them. The end users merely tolerate them, and even that has its limits. Such a transparent attempt to wring even more cash from their remaining customers is going to do nothing to win back former allies, while at the same time vindicating their critics.

    There were once those who cried "break up Microsoft!" during the anti-trust sentencing. If Microsoft decides to go with subscriptions, it may end up bringing about its own break-up with very little outside effort.

  13. Re:Not surprising. Also why we're going all OSS by houstonbofh · · Score: 3, Insightful

    I have had several clients go partway though the install of the new office versions with the Microsoft account required, and get very frustrated. Then ask to see Libre Office again. And then give up on MS Office. If these new policies will switch someone to open source AFTER THEY HAVE ALREADY PAID, it is a very bad sign for MS.

  14. Re:Not sure it will work, but there are side benef by houstonbofh · · Score: 2

    The web config on a Cisco switch...

  15. Re:Boy that will win more users.... by mlts · · Score: 3, Insightful

    Apple's system is better, and it is worse in a number of ways. A Mac only will get a certain number of OS X releases, and after that, if you want major security fixes, updates for applications, or other items, you have to replace your hardware. So, OS X is "free" in one sense... but if one factors in the fact that the hardware only will work with new releases for a certain amount of time (for example, six years and counting for my late 2008 aluminum MacBook), Apple does get its due.

    With MS, even the latest edition of Windows can run on some pretty ancient hardware, so MS earns their cash by the OS and revisions. If MS got a chunk of change for every PC made, the model might be different.

  16. 'S ok by roc97007 · · Score: 2

    I'm just about done with Windows anyway.

    --
    Oliver's law of assumed responsibility: If you're seen fixing it, you will be blamed for breaking it.
  17. Maybe they should focus on... by KingMotley · · Score: 2

    Why would you care about the log files being fragmented? Do you even know what file fragmentation is, and why that image and complaints are pretty silly?

  18. They abandoned this already by KingMotley · · Score: 3, Interesting

    And a legal license to use them only for development or testing, and not to be used as your main computer OS. Guess you forgot that part.

  19. Re:Boy that will win more users.... by osu-neko · · Score: 2

    Yeah, I have an iPhone 3GS I still use, but it's getting more and more difficult. Support for this generation of phone stopped with iOS 6, and a lot of newer apps, or newer versions of some of my existing apps, require iOS 7 or 8. I'll be forced to buy a new phone soon...

    --
    "Convictions are more dangerous enemies of truth than lies."