With just over one month til launch, PCR editor Dominic Sacco shares his views

Retailers need to forget about making money from Windows 10 the conventional way

Microsoft is still acting coy over the revenue opportunities for retailers – and distributors – around Windows 10, says PCR editor Dominic Sacco.

Having attended a Microsoft Summer press event yesterday afternoon, I was left with more questions than answers.

The event focused on business IT systems using Microsoft cloud-based services, and while interesting (the police could be using Microsoft’s Hololens VR device soon, apparently), I was expecting to hear more about how businesses could benefit from Windows 10.

However, there were a few Windows 10 devices on show, so I checked them out. The spokesperson was a product manager, so couldn’t supply me with relevant quotes for PCR, but after speaking to a few other contacts I got a better picture around the revenue side of things.

Since the day Microsoft announced Windows 10 would be a free upgrade for users of Windows 7 and 8 (excluding enterprise customers – companies with at least 250 users or devices), I was impressed but also immediately dubious. "What’s the catch?" I asked in that month’s PCR leader column, after questioning distributor partners what the deal was around licence selling opportunities, who were at the time still unsure themselves. 

Windows 10: Hands-on preview

Over the following months, Microsoft continued to assure me that there was no catch for consumers and smaller businesses. It doesn’t look like it will have microtransactions or subscription costs (other than probably flagging up things like Office 365 on the desktop for purchase).

While this is great news for the end user, Microsoft was still very quiet when it came to the revenue opportunities. And it still is today, with just over a month until Windows 10 is unleashed, and Microsoft properly embarks on its mission of getting the new operating system on one billion devices by 2018.

There could be some mention of revenue opportunities at Microsoft’s Worldwide Partner Conference from July 12th to 16th, but don’t hold your breath.

Microsoft did hint at some ‘revenue opportunities’ at Computex recently, but that was around the host of new devices running entirely on Windows 10, not around the actual operating system itself. 

In the meantime, I asked retailers what they thought of the revenue opportunities around Windows 10, and opinion was mixed. Some were disappointed there are no license selling opportunities, while others were happy to act as experts to their end customers, charging them for an ‘upgrade-plus’ if you like, complete with an install and system health check, or selling them new hardware to go along with the fresh OS. 

Read more views on Windows 10 from the PCR Retail Advisory Board

From the impression I get, I think it’s clear that this is how Windows 10 will be sold now – direct to the user and not much else. There is no license selling opportunity (for the first year after 10’s launch, anyway), so I think the sooner the channel accepts that, the smoother it will handle the big change Microsoft is implementing. And after that, selling licences could be a bonus (it looks like the Windows 10 Home Edition will cost £99.99 in the UK from July 29th 2016).

Microsoft doesn’t want to launch a Windows 11 or a Windows 12 either (or a 9, for that matter) – it will improve 10 over time and add new features to it. So in the long run, this could actually be beneficial to retailers, as if Windows 10 is continually successful after the first 12 months, they could be selling licenses to consumers for years to come.

If you step back, however, and take a look at things like iOS – users aren’t charged whenever a new version comes out, so why should they be charged for a desktop OS? It wouldn’t surprise me if Microsoft extended the free upgrade beyond those initial 12 months.

The industry is changing; managed services are on the up and cloud is continuing to grow. 

Windows is moving from just a packaged product to a more services-led model – and retailers should be too.

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