Microsoft to Charge for Windows Phone 7

Can't say I'm surprised. Microsoft is a standard software company with a standard business model. Steve Ballmer pretty much put it as simply as possible. They make software, they sell software. I don't really see anyone expecting them to give it away for free.

Google can afford to give much of their software away for free because they have a very different business model; the vast majority of their profits comes from advertising revenue.

Despite the comments that I'm sure are coming as always, this difference does not make Microsoft evil. It does make Google's software look quite appealing, though.

or they could just do the same thing that google is doing with there phone and use it as a profit generator for bing... idk that just makes alot more sence than driving up the cost of the phone another 1-2 hundred dollars... its not like they are just a software company ither... that may be there core buisness model and why bing costs more to run than its worth but what ever this is balmer

Well... WinMobile might cost money but at least there is great support incl. in that fee for phone developers. I dont know how the socalled free operating systems work. But no operating system is actually free to develop a phone for. Either you spend time aka. paychecks solving the problems yourself or pay someone to do it.

How else would Microsoft expect to make back R&D $ and profit from the product they made?

Google is the only other company that sells a viable multi-platform smart phone OS and they have an expectation of recovering development costs with the added ad revenue from more people being online.

By multi-platform I mean allowing manufacturers to install it on just about any device they can fit the OS with minor restrictions. Palm, Apple, and RIM all have multiple phones but very controlled platform releases.

Not going to work very well and they are going to continue to lose market share. Google makes money on advertisements by tying in all of the google products and sell ads on them. The ad revenue is basically pays for the software. Microsoft should consider releasing free versions of the OS that include advertisements and premium versions of the OS that are not free and don't include advertisements. I really think they are at a serious disadvantage if they can't offer some sort of free software especially when the competitor nipping at their heels is completely free.

Another problem with selling the software is that it's bad business to compete with your customers so that eliminates a Microsoft phone from ever happening. They could easily sell premium versions of WP7, give away ad versions of WP7, and build their own phone using the ad based versions. With no free versions though they would never build their own phone.

Either way, poor decision from where I'm standing. WP7 looks interesting but I wouldn't be willing to pay an extra $50 to own an exact phone with WP7 over Android.

If I get a new WP7 device next year, I wont really be paying for the OS, it will be included in the monthly rental from the carrier. If I consider the cost vs the phone and service to be value then I wont care if the cost of the OS is included in the rental.

Ok, Ballmer, we need more details on the development side of things. If developing an WP7 app takes at least a $600 package to do it, what a shame - I hope WP7 fails. If you open WP7 development for free, or a cheap cost one-time fee for a development kit which includes developer key, then I hope WP7 succeeds. Development is the most important aspect of the mobile platforms.

Its going to be the exact same as the previous versions of Windows Mobile. I dont understand the problem here.

Good luck with that.

A lot of you seem to think this will tack on 50 to 100 dollars onto the price of each phone. I highly doubt that. I'm pretty sure it will probably be more like 10-20 dollars. I'm shooting this number out of my ass, but it makes sense considering most reports claim Microsoft charges about 50 dollars for Windows 7 on a 1,000 dollar machine. Using the same logic of 5%, a 200 dollar cell phone should be about 10 bucks. In the scheme of things, I don't think a 5% charge for the OS will dissuade manufacturers from producing the phones.

There is no such thing as free. People need to wake up and realize that. Ballmer is dead on and the large corporations that work with Microsoft understand that.

Its not like AT&T is ran by a bunch of dumb smelly hippys who say "Google is free dude lets go with it."

Google isn't free. It forces people who use it to funnel advertising dollars to Google. If another company wants to benefit from those advertising dollars then they need to use a different system. Rather than attempting be an advertiser, Microsoft just sells the software and lets the buyer do with it what they want.

Just fix the freakin' lag from the other WinMo phones and you've got a sale with me! I like the business features of the Windows Phones and I assume that they will still be in here (system certificates, domain join, encrypted email, etc.).

This is a good question. On this front, I think most people can agree that Microsoft is very kind to developers and offers some great tools and API's. Especially considering you can now get free trimmed down versions of Visual Studio (C# Express, Web Express, ect...). So yeah, I will be curious to see what they have planned for developers. I hope they will have the phones be able to run Silverlight and .NET apps.

Selling their software is not a problem. If they price it too high then that would be a problem. If it works, people will buy it and price won't figure into it that much. If it doesn't work then people will buy something else, even if WM7 was free.

I understand Microsoft is in the business of selling software, and obviously the other manufacturers are on board with this, there just going to pass the cost of the software back to the consumers. But, Microsoft has always been in the business of selling partially working completed software littered with bugs, then selling you the solution to their original problems later... case in point, Windows Vista & Windows 7...

i think it's ok for Microsoft to charge for the os on the phone. if they only charge for the phone they will make no money, software is not free, someone has to stay in front of a computer monitor and write the code for it.

Is that thing gonna come with WAT? lol

Anyway, it's their business model, let them be. If it works for them and they ain't breaking any laws, I see no wrong in it. If they product sucks, it's gonna show in the profit (at least with no superb marketing campaign it will, lol).

Cheers!

Some people fail to realize that Google does make money on their software, it's just built into the price of their hardware (i.e. $500 Nexus)

I have a droid, I can tell you this much, I don't have banner ads on it generating revenue for Google.

No big surprise here. They charge for almost everything.

I'm just glad I can't afford one.

From my understanding, Google also wants an early termination fee for their phone on top of the carriers termination fee - so I won't buy that one.

Also, I think Microsoft is concerned about potential costly lawsuits. Right now Google is integrating their phones to utilize only Google apps - how long until someone considers this unfair practices (much like the bundling of IE with Windows). Perhaps by charging, Microsoft is avoiding the product tying to save on future legal costs.

Finally, Ballmer does have it right. They are in the business of selling software. They are not an ad-based service. I see nothing wrong with charging a fee for their phone OS, and I am sure that the cost will be spread out over the term of a contract.

I'd rather have a phone and OS with ZERO advertising than some Google crap tracking my every move and advertising to me. Companies all need to make profits, trust me that Google is getting your money one way or ther other. Someone is paying. MS probably does have a simpler model and may even be more cost effective for phone manufacturers in the end.

??!!?? HUH ??!!??
Glad you dont have enough money?
OK, enjoy being poorer than those can afford to buy expensive stuff...

Iv owned a G1 for a year now, and iv yet to see one ad banner.. sure there may be FREE 3rd party apps on the android market that use banners to generate rev, but the Android operating system its self, along with the google apps dont have ad banners. Add banners are optional, and are implemented at the digression of the app provider/programmer.

The competitive environment has changed significantly since Microsoft released their first phone OS. You either have the bundled approach like Apple, or the free OS with revenue generated inside of it (Android.) From a manufacturer's point of view, the real competition is Google's Android. If I'm going to make a phone, why should I pay a licensing fee for a phone OS when I can get it for free and pull a similar return with the product I'm going to sell? The Windows phone either has to become more established or Microsoft should find a manufacturing partner and build it themselves.

Is it just me or does that UI look rather ugly? It's blue blocks with white lettering on them.....not looking good for a first look.

It's a bit plain, but perhaps highly functional for basic use. It appears to have dedicated links to common functions like phone, texting, email.

What isn't clear is how it will integrate with add-on apps. Will you need to hit "start" to get to a menu of apps? That could be a problem depending on how they do it. The similar interface in WM6.1 is pretty clunky compared to the competition.

$10-20 per copy might be relatively low for a customer but for a phone manufactuter that expects to ship tens of milions of devices this would account to hundreds of millions of $ and why would a manufacturer decide to go for win7 and drop a free and PROVEN mobile os like Android. Even Symbian is becoming opensource now. Both of these OSs are considerably more successfull than WM and I don't see any major manufacturer opting for WM over these. They would offer a model or two just for the extra revenue from MS fanboys but this would never give MS any considerable share in this market.

Not even worth to compare to Apple's iPhone OS that practically invented the mobile touch interface and in a few months would be introducing the next major version.

MS's business model was truly successfull in the PC market, 1-2 decades ago and they are practically exploiting their monopoly position ever since. A PC OS is expected to do a LOT of things which makes an OS fee acceptable, expecially at the time when there were little competitors and a PC costed a riduculous amount of money. Even if smartphones have some advanced functions they are still quite limited and manufacturers are happy to write their own OS for the added functionality, plus they have at least 2-3 proven free alternatives.

The only problem I see with them selling the software is the upgradablility. When WP7.1 comes out are the phone companies going to have to buy the update? Since the phones will be somewhat the same hardware will MS sell the update and we as consumers will have to buy it before it gets pushed to our phones? Are they going to sell it at the stores itself and we can either have the phone companies install it for extra money or we can install it? Or is it going to be like present WM phones and most won't get upgrades and we'll have to buy new phones to get new functionality?

I think that is the most important info to know because if I buy a phone and there is an update I want it. This is what makes Android...for the most part since a lot of the phones get updates...Palm and iphone look so attractive. If you can't update the phone OS to the new version people may not want to buy the phone no matter how nice the OS looks.

product.

LOL @ your Vista/W7 comparison! I needed that. Windows 7 beta got SOOOO much praise for letting VOLUNTEERED test and give feedback to later become the best selling OS ever. The "buggy" talk is getting old. I can find just as many bugs in the most recent Mac and Linux OS's.

"The best things in life are free, right?"

*Looks @ Linux*
*shakes head*
"No, I guess not."