Microsoft’s (NASDAQ: MSFT) Kevin Turner said that his company is considering changing the revenue model for Windows — but the nature of that exact change is yet to be determined.
Speaking at the recent Credit Suisse conference, Turner, who is the company’s Chief Operating Officer, said that Microsoft needs to reinvent its revenue model for Windows as the company is forced to give away more and more licences and consumers are increasingly reluctant to upgrade to new versions of the operating system.
“We’ve got to monetize it differently. And there are services involved,” Turner is quoted as saying in a transcript of the meeting. “There are additional opportunities for us to bring additional services to the product and do it in a creative way. And through the course of the summer and spring we’ll be announcing what that business model looks like.”
Turner admitted that the new business model for software that Microsoft must adapt to is a far cry from the environment the company once enjoyed.
“The beautiful thing about the old-world business model was that, hey, as a customer bought our software, we got paid 100% of it up front and we got paid regardless of whether they used it or not,” he said.
Turner was light on details to what exactly “different” means, as the full details won’t be revealed until 2015. While Microsoft does give away free licenses to manufacturers for devices with a screen sizes below 9 inches, giving away the software carte blanche isn’t something that Microsoft is considering.
Many analysts expect that Windows 10 will sell well and trigger a series of PC upgrades due to the pent-up demand from users still running Windows 7 that skipped over Windows 8. Likely, the interest and demand from vendors regarding Windows 10 will dictate just how radical the shift in business license model is for Microsoft.
