The puzzle of Win10 free strategy: Is it ignoring everything for the sake of popularity?

The puzzle of Win10 free strategy: Is it ignoring everything for the sake of popularity?

Recently, Microsoft's WinHEC conference was held in Shenzhen. With the support of Tencent, 360, Xiaomi and Lenovo, Microsoft, which has never been popular among Chinese media and commentators, suddenly became popular. Of course, the reason is very simple. Microsoft's new Windows 10 operating system will be provided free of charge to Chinese users (mainly individual users). In addition, Xiaomi and Lenovo will release smartphones based on Windows for 10 Phones in the future.

Whether it was a coincidence or a deliberate arrangement, just before the WinHEC conference, at Microsoft's "Convergence" conference, Chris Caposella, a senior executive in charge of marketing, confirmed that Microsoft's software will move towards Freemium (free value-added model) in the future, and the entire business model is divided into four units, acquire, engage, enlist and monetize. In the acquire stage, the free strategy is mainly used to attract consumers to use Microsoft's software. This WinHEC is undoubtedly the large-scale practice of this first unit or the first stage in the Chinese market. Although the industry highly praises Microsoft's Windows promotion method and believes that it will help the rapid popularization of Windows 10, there are still some worrying confusions and concerns.

First, through the upgrade of 360 and Tencent related applications. The industry knows that as a system and application software manufacturer, especially Microsoft's Windows, which still occupies more than 90% of the global and Chinese PC market, Microsoft can use its own push to get users to upgrade (just like Apple's iOS and Mac X system upgrades). Why must it rely on or bundle other people's applications to upgrade? Does this reflect from one side that the PC market and users are not motivated enough to upgrade Microsoft's new operating system? If so, then the problem is not who is responsible for the upgrade, but the product itself.

Secondly, although 360 and Tencent's related applications occupy a large part of China's PC market (users), how many of these PC users' PCs actually support touch functions? I don't know whether 360 Tencent and Microsoft conducted relevant surveys before the cooperation, but judging from the sales of PC/tablet-in-one notebooks in the past two years, we believe that the PCs (including notebooks and desktops) of the vast majority of PC users do not support touch. In this case, at least half of the functions after users upgrade to Windows 10 have no practical use value for them, but will increase their confusion in using PCs. At the same time, since existing PC users have upgraded to Windows 10 for free, it will inevitably slow down the motivation for new PCs, especially PC/tablet-in-one replacements, which are already in decline. This is undoubtedly an indirect harm to OEM partners who make a living by selling PCs.

Third, is there any suspicion of forced sales through the bundling of Tencent, 360 and Microsoft? Previously, Microsoft was fined by the European Union for monopoly for bundling its own IE browser in Windows, and Microsoft had to provide users with a variety of browser options. Judging from the details released, the cooperation between Tencent, 360 and Microsoft this time is highly suspected of monopoly, except that Microsoft will add 360 and Tencent's related applications in addition to the previous IE.

Next, let's take a look at Microsoft's cooperation with Xiaomi and Lenovo on smartphones, namely Windows for 10 Phones, at the WinHEC conference. Also from the information released, Xiaomi is not going to launch a phone with Windows system, but Microsoft will provide Windows 10 flashing packages to Xiaomi enthusiasts and developers. Although Lenovo claims to release a pure mobile customized version of Windows Phone, it is unknown how many models will be launched. In fact, Microsoft has tried this method of borrowing chickens and eggs before, and the manufacturers at that time were much stronger than Xiaomi and Lenovo now, the most typical one being Nokia. At that time, Nokia had an absolute leading smartphone ownership and shipments, but Microsoft failed to expand its Windows Phone share in the smartphone market. Instead, it declined instead of increasing. Secondly, Samsung and HTC also adopted the Windows Phone system, but they also failed to reverse the decline of Windows Phone. Even after Microsoft announced last year that Windows Phone would be free for mobile devices below 9 inches (including smartphones), it still did not receive recognition from OEMs. On the contrary, Huawei, another Chinese mobile phone manufacturer with a certain market influence, publicly stated in an interview with the Seattle Times at the end of last year that Huawei did not make money from Windows Phone, and no manufacturer did, and canceled the plan to develop new Windows Phone devices. It seems that free is not the killer feature of Windows Phone, but the value it brings to partners and users.

***, if the above is the confusion brought to us by this Microsoft WinHEC conference, then the Freemium model that Microsoft will promote globally is also accompanied by hidden worries. Although Microsoft mentioned the business models of Apple and Google when explaining the Freemium model, theirs is a typical "wool comes from the dog" model. For example, the so-called free upgrades and use of Apple's iOS and Mac X systems and iWork and other applications are to sell more iPhones, iPads and Macs. Hardware is Apple's revenue and profit source. As for Google's free search, email, maps, Google Doc, etc., the core of their profit is advertising, but Microsoft's free Windows, Office, etc. are precisely Microsoft's profit core, which is a typical "wool comes from the sheep" model. Although Microsoft will still charge enterprise-level users, it still loses revenue and profits in the consumer market. ***Whether it is not enough to cover expenses, or it is sinking while carrying and holding, or the income is greater than the expenditure, it remains to be tested by the market, but the risks it contains are self-evident.

Of course, we are not completely denying Microsoft's Freemium model. After all, under the current circumstances, this may be Microsoft's only choice. We just remind Microsoft that when focusing on the first stage of acquire, it should not ignore the core of the three extremes that are still the product itself, and should not ignore the innovation of the product itself and the real needs of users for the sake of so-called market share. As Microsoft CEO Nadella said: Our industry does not respect tradition, but only respects innovation. Only in this way can the Freemium model truly lead Microsoft to success after transformation.

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