The ROI of free OS updates: Who wins, Apple or Microsoft?

Mavericks, Windows 8.1 hastened adoption, but what do the numbers really say?

1 2 3 Page 3
Page 3 of 3

More pertinent, why bother? According to Net Applications, although free motivated a bigger piece of the Windows 8 user base to update, that carrot was about half as tempting as Mavericks was to its audience. If free doesn't push most, not just some, to upgrade, what's the point of losing the revenue?

And how could it do free in any case, what with consumer and commercial so different in their opinion on upgrades? Actually, that wouldn't be an insurmountable problem, as Microsoft could offer free updates and upgrades -- even to, say, Windows 9 -- to those running the consumer-grade OS, Windows 8, while businesses running the more feature-laden Windows 8 Pro would have to pony up.

Give away Windows to OEMs?

Ross Rubin, an independent analyst with Reticle Research, had an even more radical take: Give away Windows to OEMs (original equipment manufacturers), the Lenovos and HPs of the world.

"Microsoft might monetize free Windows by bundling a basic version [with devices] but then using in-OS purchasing for upgrades," said Rubin last year in an unpublished interview. "Microsoft has long had the option in some form," he added, referring to the still-available in-OS option to boost Windows 8 to Windows 8 Pro. "It's more of a challenge to the OS because it's really a platform, but it's clear that much as is the case with Google [and Android], the opportunity is around Windows as the ideal gateway to Microsoft's services, particularly to Office."

Rubin's brainstorm runs counter to free upgrades -- instead, he posited paid updates atop a free Windows foundation -- but if Windows 8.1 didn't entice a majority to update, maybe free is a waste of time.

Rubin seemed to think so for what he called "larger releases," those that, like Windows 8 with its Metro UI or even a future Windows 9 that shifts Windows closer to Windows Phone, boast major invisible architectural or visible UI changes.

"Microsoft has charged for what it believes has a premium value associated with it," said Rubin in the 2013 interview. "There's discrete value in the larger releases.... Free for Windows 8.1 was similar to point releases of the past, which historically were given away.

Even then, Rubin qualified his take.

"But it's going to be harder to charge a large premium [for larger releases] under the trend of what Microsoft is trying to do with smaller, more frequent updates," Rubin said. "And when you think about it, Microsoft's not had that many must-have offerings on Windows that justify paid," he argued.

Any Windows come to mind?

Gregg Keizer covers Microsoft, security issues, Apple, Web browsers and general technology breaking news for Computerworld. Follow Gregg on Twitter at  @gkeizer, on Google+ or subscribe to Gregg's RSS feed . His email address is gkeizer@computerworld.com.

See more by Gregg Keizer on Computerworld.com.

Copyright © 2014 IDG Communications, Inc.

1 2 3 Page 3
Page 3 of 3
 
Shop Tech Products at Amazon