Microsoft is obviously hoping that its next version of Windows will help it compete against other tablet operating systems like Google’s Android OS and Apple’s iOS.
But according to a recent report, Microsoft will be charging tablet manufacturers around $85 per device for Windows RT, which could add considerable costs to Windows tablets and drive the price of the devices up compared to competitors.
According to sources, who have spoken to a number of manufacturers, Microsoft will be charging on average $85 per device for Windows RT, which will not give the manufacturers much room to produce sub $500 tablets with Windows RT.
This could mean that the first Windows-based tablet will be available in the $549 to $799 range, and premium versions of the tablets will probably retail between $799 and $899.
Impact on Market Competitiveness
If this turns out to be correct, it doesn’t seem like a very clever move on Microsoft’s part, as Windows 8 tablets won’t be able to compete in terms of price with Apple’s iPad and various Android-based tablets. The iPad, for instance, starts at $329 for its base model, and many Android tablets are available for even less. This price discrepancy could make it difficult for Windows tablets to gain a foothold in the market, especially among budget-conscious consumers.
Moreover, the higher price point could also affect enterprise adoption. Businesses often look for cost-effective solutions when equipping their workforce with tablets. If Windows tablets are significantly more expensive, companies might opt for cheaper Android or iOS alternatives, which could further hinder Microsoft’s efforts to penetrate the tablet market.
Potential Justifications for the Pricing
However, there could be reasons behind Microsoft’s pricing strategy. One possible justification is the inclusion of additional features and services that come with Windows RT. For example, Windows RT tablets are expected to offer a more desktop-like experience, complete with a version of Microsoft Office and better integration with other Windows-based systems. These features could justify the higher price for some users who are looking for a more versatile device.
Additionally, Microsoft might be banking on brand loyalty and the familiarity of the Windows ecosystem to attract customers. Many users and businesses are already deeply integrated into the Windows environment, and the seamless integration between their existing Windows devices and a new Windows tablet could be a significant selling point.
Another factor to consider is the potential for future price drops. Initial pricing often includes a premium for early adopters, and as production scales up and competition increases, prices could come down. Microsoft might also offer discounts or bundle deals to make their tablets more attractive.
In conclusion, while the $85 licensing fee for Windows RT could make Windows tablets more expensive compared to their Android and iOS counterparts, there are several factors that could influence the overall market dynamics. The success of Windows tablets will likely depend on how well Microsoft can leverage its ecosystem, the additional features it offers, and its ability to adjust pricing strategies over time.
Source Slashgear
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