Microsoft Corporation (NASDAQ:MSFT) will provide its Windows operating system for free to smartphones and small tablet makers to influence and capture the fast growing markets and compete against the Google Inc’s free Android platform.
Windows market share shrinking
Through this initiative, Microsoft Corporation (NASDAQ:MSFT) wants to expand itself among the smaller users of mobile versions of Windows. The software giant believes that the customers will subscribe to the company’s money making, cloud-based services such as Skype and Office. Till now, the phone and tablet makers pay $5 and $15 per device to Microsoft for using its Windows operating system, and include the cost of these services into the sale price of every device.
However, the strategy is fading away since last couple of years as Google’s Android is thriving in the phones and tablets market. Android, which is readily adopted by the phone and tablet makers, has clinched 75% of all smartphone sold, last year. Majority of the remaining share is grabbed by Apple Inc’s iPhone and iPad account. On the other hand, Windows Operating System phones have only 3% of the global smartphone market last year, and tablets account for minimal 2% of the market, according to tech research firm Gartner.
Against Bill Gates philosophy
The current strategy from Microsoft Corporation (NASDAQ:MSFT) of making available the software to some of the devices for free is in contrast with Bill Gates philosophy of software should be paid for, which took the company to great heights.
According to Daniel Ives, an analyst at FBR Capital Markets, “Microsoft is facing challenges on the mobile and tablet fronts and need to change their strategy to move the growth needle, this is a good and logical first step.”
Microsoft Corporation (NASDAQ:MSFT) has decided to provide free Windows operating system to the companies that manufacture phones and tablets with screen size less than nine inches (23 cm) for the consumer market. However, the companies will have to pay a license fees. The strategy follows an earlier move from Satya Nadella (Microsoft’s new Chief executive) of unveiling the new version of Word, PowerPoint and Excel applications for Apple Inc’s iPad.
Microsoft Corporation (NASDAQ:MSFT) is surely rolling up its sleeves to gain greater market share for its cloud based services such as Office on any platform or device in contrast to forming Windows centric strategy. Nadella has accepted the limited reach of Microsoft in the burgeoning market and wants to enhance it.
