November 16th, 2005
Could Microsoft Actually Make Money Giving Away Its Programs?
By Jimmy Daniels
Contributing Writer, RealTechNews
As Michael noted in an earlier article, Microsoft is looking at free, ad-supported versions of many of its titles, although, you can bet Office won’t be one of them, and it appears that competing with Google isn’t the only reason for them to consider it. Many of its software titles, such as Microsoft Works or Microsoft Money, do not bring in any revenues at all, and Money isn’t even at a break even level. Microsoft has to heavily discount OneNote to even get it included on computers, and it only recieves $2 a copy from computer manufacturers for Microsoft Works.
Calculating that the average person keeps their copy of its entry-level productivity suite Works–a kind of “Office lite” for consumers–for about three years, Microsoft reasoned that it wouldn’t take a lot of ad revenue to justify moving the product to an ad-driven model.
“That means that if ad revenues exceed 67 cents per year, we could actually give Works away and still make more money,” two Microsoft researchers and one person from MSN stated in a paper presented to Chairman Bill Gates at a Thinkweek brainstorming session earlier this year. Source: News.com
We Say: Heck, if all they need to make in one year per person is 67 cents, I KNOW they could make more money giving it away and supporting it with ads. Sounds like a win/win for everyone, but if they ads are annoying, well; I may have to purchase it instead.
Technorati Tags: Microsoft, Adsense, Google, Advertising, RealTechNews
Rich says:
Heck, I would pay a dollar a year to not have the adds.
November 16th, 2005 at 10:25 am
Pete says:
Or…and this is just a thought… you could go to Openoffice.org and download version 2.0 for free, not have any adds and have a much more full featured office suite (which, interestingly, has better file transfer compatibility with MSOffice than MSWorks does, perticularly for non .doc’s.
Oh, and you would be able to run it on multiple OS’s. A true win-win.
November 16th, 2005 at 11:12 am
Jimmy says:
Good point Pete, I’ve been meaning to check out Openoffice, just haven’t had the chance, yet.
November 16th, 2005 at 8:21 pm
Omari says:
Someone on Slashdot pointed out that the problem with the MS logic here is that MS is getting $2 per installed copy for Works. Not every installed copy is used. How many people who get Works preinstalled actually use it? A third? A fourth? Less?
Therefore, it’s faulty logic to think that all those installed copies will translate into ad revenues. Only the users who actually use Works will generate ad revenue for MS.
Of course, the only exception to this would be if MS decides to become an adware/spyware company that pops up ads for every installed copy of Works, whether the user uses Works or not.
November 17th, 2005 at 6:16 am
Jim Rome says:
At what point did this ever seem like a good idea for Microsoft? Didn’t everyone give up on this form of software like 2-3 years ago? This is not epic it is stupid.
November 17th, 2005 at 10:25 am
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