Microsoft cuts Windows 8.1 licensing fees 70%

Microsoft cuts Windows 8.1 licensing fees 70%
Microsoft is facing a fair bit of competition from all sides these days. It does still hold a strong majority of the PC market, but the PC market is shrinking as tablets and smartphones take over the casual usage space, and there is also competition from Google Chromebooks in the budget PC market. Now, Bloomberg is reporting that Microsoft is taking a bold step to be more competitive: cutting Windows 8.1 licensing fees by 70%.

The report says that the licensing fee drop will specifically target devices that will sell for less than $250. The fee had been $50 per unit for devices at that price point, but now it will cost manufacturers just $15. Bloomberg says that the price reduction was a response to Google Chromebooks, which have been doing extremely well in the sub-$300 market. But, we can't help wonder if Android tablets might not also be part of the equation. 

Windows 8 Pro devices have been dropping in price in order to better compete with Android tablets. Some, like the Dell Venue 8 Pro have even gotten as low as $299. If the licensing fee will cost $35 less, manufacturers like Dell might be tempted to push for that $250 mark with those tablets. Suddenly, you would have a full Windows 8 device in direct competition with something like the Nexus 7. Of course, it doesn't really explain where Windows RT fits in, but Microsoft wants to generate sales any way it can at this point.

source: Bloomberg

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29 Comments

1. Miracles

Posts: 560; Member since: Aug 31, 2013

No wonder Win wasn't doing so good...they charge manufacturers like hell.

8. androtaku

Posts: 246; Member since: Dec 12, 2013

how much u think they should charge then? if u running a software company developing an OS

11. tedkord

Posts: 17296; Member since: Jun 17, 2009

Low enough that OEMs can make competitive priced products with it and still turn a profit.

26. PBXtech

Posts: 1032; Member since: Oct 21, 2013

And low enough so there's enough OEMs to entice developers to write apps for the OS.

2. ocilfa

Posts: 334; Member since: Aug 03, 2012

Great to hear, now do the same for consumer licenses.

3. rodneyej1

Posts: 3576; Member since: Jul 06, 2013

And for Windows Phone..

10. Liveitup

Posts: 1798; Member since: Jan 07, 2014

I think they may make Windows Phone license free, Android will then be more expensive to create than a WP device as OEM patents fees will still be in effect for Android devices, Windows OS offers a great user experience, good to see MS ramping up the pressure.

24. rodneyej1

Posts: 3576; Member since: Jul 06, 2013

WP needs to be free, or considerably less.. Heck, they make $ off of most Android devices made, so that should take care of any development cost.. IDK how this stuff works, but if MS want's it's newest OS's to continue to gain traction then they need to let up a bit..

4. rodneyej1

Posts: 3576; Member since: Jul 06, 2013

Nevertheless, this is only for low end devices, not every device...

5. kaikuheadhunterz

Posts: 1157; Member since: Jul 18, 2013

Ubuntu and other Linux distros has no licensing fee. Just saying...

6. nlbates66

Posts: 328; Member since: Aug 15, 2012

yeah but then they don't even have as much marketshare as Windows 8 either. :)

12. kaikuheadhunterz

Posts: 1157; Member since: Jul 18, 2013

It's not about the market share. It's about creating a competitive market

14. Gemmol

Posts: 793; Member since: Nov 09, 2011

I understand but not much people want to use those things. If I was them I would charge look at the Gamecube for Nintendo, it only sold 20 something million, but they never sold it under profit, so although it look like a lost compared to the ps2 profit wise it did well. In other words they should make profit on their product instead of giving it free where not much people use it, at least with the money they earn they can use it for other things.

19. networkdood

Posts: 6330; Member since: Mar 31, 2010

Sony and Microsoft have been selling their systems for a loss, more often than not...

21. papss unregistered

I was going to say the same.. The PS and Xbox systems often don't turn a profit until many years in the life cycle

25. rodneyej1

Posts: 3576; Member since: Jul 06, 2013

Good point! And, at around 11% market share W8-8.1 is doing pretty good after being on the market for only one year... But, you're right.. It's not all about market share..

18. networkdood

Posts: 6330; Member since: Mar 31, 2010

Part of that reason is Microsoft and their tactics...for which they have been sued for countless times and for countless billions of dollars..

15. Martin_Cooper

Posts: 1774; Member since: Jul 30, 2013

Yeah and linux doesn't have a single company behind it with tenth of thousands of people working for that product every day, R&D center, innovation center, and s**t loads of other things. its not free for a reason and most apps are made for win instead of linux for a reason too.

7. 13Elves

Posts: 93; Member since: Feb 21, 2014

They had no choice. Still a good move. At that price point we're talking AMD 4 and 6 series APUs not bad at all.

9. sonisoe

Posts: 440; Member since: May 06, 2009

do the same for msft current $400 tablets ie. dell venue 8 pro, etc so oems can replace atom with haswell processor, and compete with flagship android tablets usually priced the same (except for nexus 7)...market it well that msft tablets are not only more productive (word, excel, etc) but also more powerful....all things considered, msft can start making up their revenue loss from the pc business, even making loads more money.... for me its a no brainer, i'd go for a windows 8 tablet...

13. varezhka

Posts: 5; Member since: Jan 28, 2014

Are they going to do something about the Windows RT license cost too, or have they completely given up on that OS?

16. androiphone20

Posts: 1654; Member since: Jul 10, 2013

Frank Shaw must be feeling like an a$$ right now after spewing BS about Apple giving away Mavericks for free. Chromebooks are crappy and they scare the living sheet out of M$, Windows is boring :/

17. papss unregistered

Thus is a good move by M$ and I feel its just another step in the right direction for them. They are fighting on many competitive fronts and I'm sure its a huge task to turn a whole company as big as theirs so I applaud them for all the changes.

20. networkdood

Posts: 6330; Member since: Mar 31, 2010

Funny, how people cheer these companies on - these same companies that spy on you - HIP HIP HOORAY!!

22. papss unregistered

Double edge sword bro... All do things bad but also needed for my shallow day to day needs

23. androiphone20

Posts: 1654; Member since: Jul 10, 2013

Just quit acting like an a$$ there are many agencies that have yet to be busted, besides you being here just goes to show you're dumb enough to connect to the internet where all rhr spying takes place. Go sit in a cave and let normal rational people be

27. SuperMaoriBro

Posts: 533; Member since: Jun 23, 2012

Microsoft should have been priced like this from the start. Sorry MS you lost my interest because in the beginning you went after profit margins when you should have gone after market share by being priced competitively

28. rodneyej1

Posts: 3576; Member since: Jul 06, 2013

Who cares....

29. 7thspaceman

Posts: 1597; Member since: Feb 14, 2011

Folks this license price cut is good. A lot of people want full Windows 8/8.1 tablets but the good ones that use Intel i5 and i7 CPU'S still cost an ARM and A LEG. Until Intel lowers the price of the Haswell i5 & i7 CPU"s Microsoft wont sell as many mid range Tablets and Laptop/Ultra books as they want Intel alsol has to make better low cost mobile ATOM CPU's to help Microsoft sell cheaper Low cost but good running tablets

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