Stolen Thunder

[SnailUK]

Surely it would have been worth their while taking a hit at launch and subsidising the manufacturers to an extent to deliver WP8 all guns blazing at an aggressive price.

Prices can go down easily, you can't put them up.

Why should OEMs take a hit now? Why bother with WP8 at all, if the only way to sell handsets is to sell them at a loss? If Microsoft subsidise the OEMs when will they ever be able to stop?

 

[JimiDiGriz]

But if you drop prices too quickly then people will shout 'fire sale' and as for subsidising the OEMs, as I said MS need start aggressive and get people on board. Amazon break even or even make a loss on their hardware. This is about getting people to buy into Wp8, new people, I just don't know if that will happen when competitor phones are so reasonable by comparison, not to mention more established.

 

[SnailUK]

Amazon break even or even make a loss on their hardware.

Nice example, so lets take that forward.

So, Amazon sell their hardware at a loss, but force a UI, that is Amazon only, and you then buy amazon stuff, making money.

The OEMs won't be able to do this, as they have no revenue stream once the handset is sold. So, the Surface phone has to be our Amazon equivolent.

Microsoft sell the Surface phone at a loss. Its significantly cheaper than all the OEMs, so it sells like hotcakes, but in the process Microsoft losses the OEMs (as they can't compete). So, you are left with one, maybe 2 bargain basement WP8 handsets.

Now Microsoft have killed off the OEMs what do they do? Where do the interesting handsets come from? Where is the innovation? What do we get? 1/2 new generic cheap handsets every 6 months.

Is that really what you want from WP8? Its certainly not the future i want.

 

[JimiDiGriz]

Okay, so following that line through, and I'm not disagreeing with what you've stated above, how are Google able to sell the Nexus 4 at that spec and built by LG for such a low price? A flagship phone ?200 cheaper than the flagship WP8 (920) and ?150 cheaper than the 8X?

If people don't jump on board now and in larger numbers than WP7 managed to attract it could be argued that WP8 won't have much of a future as they can't break into Apple/Android marketshare.

Plus BB10 will arrive early next year.

 

[SnailUK]

How are Google able to sell the Nexus 4 at that spec and built by LG for such a low price? A flagship phone ?200 cheaper than the flagship WP8 (920) and ?150 cheaper than the 8X?

Selling a dirt cheap phone is easy, especially if its Google paying, where they don't care about making any money on the phone.

But what effect will it have on Android OEMs? Being that Samsung seem to be about the OEM making money off Android, pushing a price war can only result in less OEMs.

 

[JimiDiGriz]

So Google have done what I suggested MS should have done in my original post with the WP8 launch which is to price the phones low. Go aggressive (by subsidising the OEMs for the initial tranche of phones if necessary) to build the user base and therefore marketshare. Have we come full circle here? Get users on board, apps follow, advertise integration with Windows 8, xbox etc and build on the promise of the OS. OEMs see the benefit in supporting the OS long term and it snowballs (hopefully). but you said subsidy was not a good idea even though that's what Google is doing? I'm not sure i agree with your logic there as Android is very unlikely to lose OEMs as they are one of the two big players in the smartphone area.

The worst possible outcome here is that MS launch WP8 and sales are poor. This creates all the wrong headlines which is strengthen public perception (where there is one) about the OS. I hope I'm wrong and WP8 takes off but I go back to the scenario of the man on the street; walk into a shop, maybe you've heard of WP8, heard it's new, maybe you pick up a 920 and have a play and maybe you like it. But it's still new and unknown to an extent. Do you like it enough to risk ?200 more than the Android next to it in the display cabinet that looks quite flashy with a nice big screen and quad core on the label? Not to mention a sales assistant who might not know or favour WP8 over Android?