Microsoft Corp. will give away its upcoming Windows 10 operating system as a free upgrade to users of the most recent versions of Windows and Windows Phone.
The strategy is a calculated gamble for Microsoft, designed to put Windows in as many devices as possible as the world’s largest software company tries to retain customers in the mobile era, Reuters reported.
The firm will try to make up for any lost revenue by selling services such as Office over the internet, or cloud.
“It’s a necessary evil, as CEO Satya Nadella and Microsoft have recognized the ‘golden goose’ and major revenue opportunities will happen after the upgrades have taken place,” the report quoted Daniel Ives, an analyst at FBR Capital Markets, as saying.
The immediate impact on revenue is unlikely to be large, as Microsoft gets no more than US$500 million of its US$20 billion or so in annual Windows revenue from upgrades, analysts said.
The bulk of Windows revenue comes from hardware makers that install it on new personal computers and businesses that pay for multiyear licenses.
Windows appears on roughly 15 percent of computing devices, including phones and tablets. Microsoft lags Apple Inc. and Google Inc., which regularly update their operating software free for customers.
Microsoft also unveiled a holographic lens device that allows users to see three-dimensional renderings of computer-generated images.
Microsoft HoloLens will be available around the same time as Windows 10 this autumn, a Microsoft executive said.
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