Microsoft last year launched an initiative to improve the adoption rates of Windows 8.1 among cheap laptops. OEMs and partners of the software giant raised the issue of the Windows licenses on their products taking up too much of the product’s budget. Microsoft responded by creating a new version of Windows 8.1 that came by default with all search engines set to use Bing Search and with other software set to use Bing and other Microsoft services on the internet. Now it seems that their generosity with the new version, which was often made free for devices under a certain size or price point, has backfired on their revenue, causing the company to make some adjustments to their offering to OEMs.
The company has new rules for Windows 8.1 with Bing and they will only allow for the licenses to be free on devices that have a display 14 inches or smaller that are also under the $200 price point. According to sources close to The Register, these devices will continue to receive Windows 8.1 with Bing licenses for free, but any notebooks with displays over 15.6 inches in size and cost more than $200 will receive heavy discounts for the OEM licenses for Windows 8.1.
Windows 8.1 with Bing was initially conceived to allow Microsoft to deal with the rising popularity of Google Chromebooks among consumers shopping on a very small budget.
The main reason for the change is that Microsoft saw huge drops in licensing revenue from Windows as more consumers bought the cheap notebooks and hybrid tablets that were part of the promotional offer. Q4 2014 saw revenue from Pro and non-Pro versions of Windows drop by 26%. In the UK alone, out of 115,000 Windows 8.1 with Bing devices sold through to consumers throughout Q4 2014, approximately 94,000 of those were 15.6″ notebooks.
For the consumer, this means that we’re going to see an increase in the price of cheap notebooks that will be entering the sales channel towards the end of February 2015. How much it will increase prices locally remains to be seen. It may be R100, or it could be R500, but its definitely going to go up. If you’re on the fence about buying something today that comes with Windows 8.1 with Bing, you might want to hop on it before stock runs out to avoid dealing with the increases.