CEO Steve Ballmer said Monday that Microsoft won't be leaving behind the old Windows Mobile licensing model, so
Business Insider estimated the numbers to see if the old model is worth sticking to. The conclusion: Probably not.
Competing platform Google Android is free if handset-makers and carriers want to use it, while the other two biggies — Apple's iPhone OS and Research in Motion's BlackBerry OS — are only put on phones made by Apple and RIM, respectively.
Competing with Free
Android is well-poised to become the Windows of smartphones in the coming months and years — the ubiquitous, default platform installed on the great majority of devices.
Obviously, Microsoft wants the Windows of smartphones to be, well, Windows. But handset makers are going to be squeamish about taking $5, $10 or $20 out of the profits for each handset sold and giving it to Microsoft when it can provide its consumers with comparable features at higher profits by going with Android instead.
Sure, Microsoft could hike up the prices of Windows phones so the consumers pay the license fee, but would consumers go for that, especially when Android has a head start in building a large library of useful apps?
On the other hand, Microsoft has not had a lot of success with "free" in the past. If it can beat the competition in features then the cost is justified. For example, Microsoft's Xbox Live online gaming service charges an annual fee while Sony's PlayStation Network does not, but there are enough extra perks that few people complain about it.