Microsoft: We will pay you to upgrade

No copyright infringement intended. Photo courtesy of digitaltrends.com
Surface tablets on display at a Microsoft Store

If you are using an outdated PC, which is incapable of running Windows 8 on its hardware configuration, you’re in luck.

Microsoft, in its efforts to bolster Windows 8 adoption, has launched a new promotion that will allow users to earn $100 store credit towards their purchase of a new Windows 8 PC costing anywhere from $599 to $2,299. To further add to the bargain, Microsoft is offering 90 days of free support and free data transfer, as well.

On April 8, Microsoft will end their support for Windows XP. This, essentially, means that Microsoft will cease to offer security patches, service packs, and other such OS maintenance related support.

The core incentive for Microsoft to launch this promotion stems from the unsatisfactory adoption rate of Windows 8. OF current desktops, only 6.4% of them are utilizing Windows 8, and about 4.3% are running Windows 8.1. However, will such a promotion allow Microsoft to take dramatic strides in increasing Windows 8’s market share? Most likely, not.

The promotion mandates that $100 credit be offered only to a PC purchase ranging between $599-$2,299. By restricting the amount to such an interval, inherently shuts out the core lower end of the PC market. PC’s that sell for prices between $200-$400’s, are quite popular amongst budget-minded individuals, who expect moderate performance at a moderate price. If the promotion was extended to that price category, however, for a lower amount of credit ($50 perhaps), Microsoft will effectively tap into potential sales for additional Windows 8 PC’s and thus increase the market share of Windows 8.1.

Moreover, however, it will also allow them to effectively compete with cheap offerings such as Chromebooks. Currently, an HP Chromebook sells for $279. If, for example, a Windows PC was priced at $379, and reduced to $50 as part of the hypothesized promotion, the base cost would amount to $329. Free support and data transfer would only further compel the consumer in the favor of the Windows PC.

In the grand-scheme of things however, the effects will reverberate through many levels. If the campaign is successful, and extended to lower price points. There is a possibility that it will augment quarterly earning, and aid in augmenting the share price of Microsoft(MSFT), which is currently trading at $40.34, as of 3/26/14.

Regardless, in all fairness, this promotion is still targeting a great deal of consumers, and should allow the company to gain some share until June 15th, when the promotion expires.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s