10-08-2015 10:02 PM
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  1. MikeX74's Avatar
    If their only goal is to grow market share, yes. If they actually want their phone division to be profitable, no.
    10-05-2015 01:26 PM
  2. NoFlames's Avatar
    I came here to say this, but I agree 100%, you nailed it!

    Selling at zero profit or less means MS would remove any and all profit potential from the WP hardware market. This would make MS the scourge of the industry and draw the ire of companies who rely on smartphone profits to survive. By killing the profit potential in the WP market, MS would also turn away any OEMs currently thinking of releasing a WP device. I personally don't find engagement by other OEMs important, but many others here do.

    If MS wants other OEMs to engage, they must take the exact opposite approach, by asking well above average prices.

    I actually question whether MS is earning any money on these at all, even at $700. There is no set price at which a phone is guaranteed to make a profit, as it must first recoup the hundreds of millions MS invests in software and hardware engineering. That means the only way to make a profit is by selling high-end devices, with high margins, in large numbers... something high-end Lumias don't typically do.

    Assuming these won't sell in large numbers, it's safe to say these devices are already losing MS money at almost any price. IMHO the question is not whether MS should be prepared to lose money, but how much?

    I do think they must come in below the price of an iPhone, but expecting MS to go much lower isn't fair either.

    Either way, chasing market share is not W10M's goal. Even if it was, it would be far more reasonable to do that with low end devices.
    a5cent likes this.
    10-05-2015 01:27 PM
  3. Xaxxus's Avatar
    yes, but you also need to look at it this way. If you are an average joe looking for a smartphone and you walk into a best buy. You are going to see a bunch of smartphones priced around $299 on contract.

    You can get an iPhone, an android device, or a windows phone.

    All are priced at a premium price point. Which do you choose?

    9 times out of 10 its going to be either an iPhone or an android phone. Nobody wants windows phones, nobody really knows much about them and refuses to try them when they can get an iPhone or android. You have to give people incentive to TRY windows phone so that they will like it and reccomend it to others. If they can get anything else for the same price, they are going to go for the better options.
    10-05-2015 01:44 PM
  4. Paul Cordova's Avatar
    For me, i can already say that if the 950 XL isn't cheap (cheaper than 400 unlocked). The lumia 735 i have now will be my last windows phone. I will probably wait out for a Nokia Android. (I've simply given up a bit over all these years of being a betatester).
    Then your 735i should be you last. You're smoking crack thinking the phone should be that cheap. Comparing the 950XL to iPhone 6s Pl($849.00 for 64G model) and galaxy S6+ edge9 ($749.00) . You're saying they should price it at basically half of current phones. I think if it comes in around 600-650 it'll be a steal.
    10-05-2015 03:20 PM
  5. luxnws's Avatar
    Another obvious prediction: Microsoft will throw in a one year subscription to Office 365 with the unlimited OneDrive storage and $50-$100 worth of Skype credits with the Lumia 950/950 XL.

    What other freebies can they add?
    10-05-2015 03:34 PM
  6. FearL0rd's Avatar
    sure :)
    10-05-2015 03:37 PM
  7. a5cent's Avatar
    Tell that to Apple, because that's how Apple sell Macs to iPhone users and why Mac sales are growing. Microsoft is just betting the other way - hoping Windows 10 desktop users would buy a W10M to accompany it. This strategy makes sense, and for once MS actually has a good footing to start with due to W10 desktop being well received, unlike W8 which had a terrible reputation which dragged down everything along with it. So yes you CAN indeed sell it to people the idea of a fully "in" ecosystem. The issue is going to be Microsoft's marketing effort, which we can all agree on is terrible, but MS does have a unique product experience in hand that cannot be full realised with a mixed environment. Yes you do get some of it, but it's not best.

    To tgp's objections I'd add, that even if MS could extract profits from the smartphone market similar to Apple's, the two companies ability to cross sell devices and services would still be in no way comparable to each other. Apple exerts far more control over what is admissible to their app store and what products and services may be sold via an iOS app without providing Apple a cut. This limits Apple's exposure to competition within their own ecosystem, which is what some call "walled in". Getting anything Apple to interact well with anything non-Apple is also almost unthinkable, which is the primary force behind Apple's cross selling capabilities. We also have the fact that Apple's own apps are available nowhere except within their own ecosystem, making people think twice about adding anything non-Apple to their hardware collection. MS is pretty much the exact opposite on all those fronts, and many others. Only if all that changes would I accept yours as a reasonable analogy. Only then will cross selling be equally effective for MS as it is for Apple.

    As for the rest, I don't know what to say since you're far too vague for anybody to know what you're really talking about.

    If you're thinking about universal apps and things like continuum, and how such apps will allow for more similarity and interoperability between desktops and smartphones, then yes, I agree that MS has a path forward there. However, I see that as being far more interesting to corporations than consumers, at least initially. Whether that will pan out for consumers too remains to be seen. If and when it does, then I do see MS getting back to promoting W10M more strongly and again chasing smartphone market share directly.

    If you're thinking about specific OS level interoperability features that are independent of MS' UWP vision, then you'd have to explain what the benefits of that "unique product experience" will be, which will compel so many to abandon their Android and iOS devices. I don't see anything easily understandable, highly desirable, and easily marketable in W10M that would cause notable defections.

    It's okay that you mention it, but it's not okay to spin it as MS not caring about W10M.

    I've repeatedly explained how nothing I've said implies that MS doesn't care about W10M! It shouldn't be that hard to separate the concept of "caring" from the concept of "directly and strongly pursuing market share gains".
    Last edited by a5cent; 10-06-2015 at 10:11 AM. Reason: spelling
    10-05-2015 03:39 PM
  8. MikeSo's Avatar
    First of all, and before price is even a consideration, Microsoft needs to get these phones into the stores where people buy phones.
    They can GIVE them away, but if they can't be found anywhere except at Microsoft Stores and AT&T they're dead in the water anyway. People buy phones in malls, Costco, Best Buy, Target, Wal-Mart, franchise stores etc - and in those, Microsoft have at best had a few cheap 635s, at least here in the US.

    Get the phones into the stores. Then we'll see.
    10-05-2015 04:57 PM
  9. Shai Petel's Avatar
    So, we all know that Microsoft is coming out with new Lumia phones soon, the 950 and 950XL. Considering everything we know about these, from a hardware perspective they are great, but not really anything above what competitors have, or will have in a couple months.

    So that leaves the OS. While those of us here who know Windows Phone, have (mostly) come to love it, we are a very small percentage. And, here we are for the third time with a major re-build of the phone platform from MSFT in 5 years (WinMo 6->Windows Phone 7, Windows Phone 8-> Windows Mobile 10).

    Trying to get someone to move from their beloved iPhone, or the Android they've learned to live with to Windows 10 is going to be a hard sell. I mean MSTF has struggled with this, as evidenced by their ~3% market share.

    And now that the USA is largely moving away from subsidized phones (hooray), people have to think about the cost of their phones when they upgrade. It isn't just an automatic anymore.

    So, I think Microsoft should sell these new phones at either 0 profit, or even at a loss. If the phones could be $100 or more cheaper than the competitors, people might seriously consider them the next time upgrade. But seriously, if joe average is at the store, deciding on an upgrade, and he can get a new Android phone a new iPhone or a new Lumia all for roughly the same price, Microsoft will lose 98% of the time.

    If on the other hand, the Lumia was $100 or more cheaper, that percentage is surely to go up. If Microsoft could do this for a couple years, and actually get a foothold in market share, and then start to really show off the integration of windows 10 on your PC with windows 10 on your phone, THEN they can afford to start making a profit.

    We know Apple can't afford to discount their phones, it is their bread and butter. Samsung couldn't face their share holders with that message. Google probably could get away with it with the Nexus line, but they don't need to, they are winning. Microsoft could easily sell this idea to the share holders, IMHO.

    Mr. Nadella, are you listening ????

    A Long-term Loyal Microsoft customer!
    well, they have been doing that with mid-low range phones, which was a mistake IMHO. They need to do it with premium high end phones.
    Why? Since someone who see a low-cost Hyundai is less likely to want to buy an expensive one, or to even love the brand.
    Whereas, someone who see a high-cost premium Tesla/Ferrari is more likely to love the brand and want to buy a mid-low range one if one comes out.

    My 2 cents. The way I see it, MSFT had it all wrong with flooding the low-end market.
    10-05-2015 05:46 PM
  10. baandoptager's Avatar
    Then your 735i should be you last. You're smoking crack thinking the phone should be that cheap. Comparing the 950XL to iPhone 6s Pl($849.00 for 64G model) and galaxy S6+ edge9 ($749.00) . You're saying they should price it at basically half of current phones. I think if it comes in around 600-650 it'll be a steal.
    I don't see that being ridiculous. Microsoft is loosing all across the board and they need to knock off atleast a couple of hundred of these phones in order ot really compete. Yes, the G6 Edge + Megastar Ultra SWAG maximum and all the other "fancy" phones start from 599/699/749 and what not, but they are truly "flagships" in terms of quality, design, appeal and functionality unlike these new mid-range generic designs with competitive yes, but unproven hardware specs.

    MS has proved nothing with half a decade of Windows phones. Do you think anyone outside is going to buy in on a promise of yet another wave or "Just give us 5 more years"? No freeking way! MS have been ignoring their own for way too long!

    They need to follow the example they performed with the XBOX when it first came out and had to challenge more than many consoles, mainly Playstation. People will make up for it in terms of extra and extra is exactly what MS is looking to sell in the future. Exactly like they've done with apple and google within this last year fx. It works! and they need to bring that kinda generosity to Windows users.
    10-05-2015 07:18 PM
  11. Aquila's Avatar
    I think that we're seeing two different arguments that can be reconciled.

    The first is that, "heck no they shouldn't underprice it, it is clearly WORTH a full flagship price because it is a full flagship phone with flagship specs and I love it". The second is, "but everyone who doesn't want it already (everyone who hasn't read this thread yet) isn't going to want it if there isn't a value argument to be made.

    So reconciliation: What price would make someone who went in the store to buy "the best phone", take a look at Windows long enough to examine the spec sheet or ask a question that may lead to them buying the 950 or 950XL? Nexus 6P, Note 5, iPhone 6sPlus and Lumia 950 XL are on a shelf together, lights, music, nothing else in the area... $600, $900, $1100 and ... $ ___?

    If I am average joe schmoe who doesn't even know that Windows makes phones, what's the number that makes me go, "wait, what's this?"
    MikeSo and Tien-Lin Chang like this.
    10-05-2015 07:45 PM
  12. Simon Reyes's Avatar
    Let's do it, with the new app port through apple and android store I think it will be a good alternative
    10-05-2015 09:30 PM
  13. 7a2eer's Avatar

    I've been going through the API and designing software using the MVVM pattern for the Universal Windows Platform.
    Unfortunately I feel as though W10M is DOA with Islandwood and Astoria.

    I have already sold my Lumia 1520, and have decided to stick to my Nokia 808. I dislike Android and iOS, BB10 was DOA, and now the WP8 I loved is no more. Whatever passion I have with modern app development dies with WP8.1.

    I wonder how everyone else feels about the changes to the OS. Personally I feel as though W10M is a clunkier Android, even the live tiles have little purpose these days.

    Why not do the opposite? (AOSP, WinRT application layer). They are not going to dominate the mobile ecosystem, at least give consumers the best mobile experience. Tax OEMs with their apps/services *patents cough cough*

    Its not like you guys are going to miss an irrational and confused developer like myself. Hopefully you will get to try my Android games soon, you can download them from the Windows store
    EDIT: Never making an app with hamburgers, but Windows exclusive development is now moot imo.

    As to price, no need to discount. Either way Microsoft is going to generate similar revenue over an extended period of time, provided their platform is DOA. Save this for another rant :(((
    Last edited by 7a2eer; 10-05-2015 at 10:17 PM.
    10-05-2015 10:06 PM
  14. houkoholic's Avatar
    Apple and Microsoft are in two different leagues in mobile. Apple of course would like to have a higher market share (meaning higher sales; what company wouldn't), but what they have is fine because they make a boatload of money. Apple makes more profit than any company in history. Microsoft so far has lost a lot of money in their mobile division.

    Microsoft needs higher sales. Apple doesn't. If Microsoft made a profit at 2.7% market share, they wouldn't care either.
    You've just contradicted yourself. When you said if you have higher profits then market share is not as relevant, then you go around and said Microsoft needs higher market share, but completely ignores that Microsoft is changing their strategy to stop chasing for higher market share and going for higher profits, that's the entire point of the strategy re-alignment.

    Everyone should understand that a 2.7% marketshare of 5 different types of 50 dollar phones with practically no profit margin is much less desirable than a 2.7% marketshare of just 1 type of 400 dollar phones. Nokia's strategy led to the former outcome, which was not a particularly desirable position, MS is now trying to going for the later. That's why they say they aren't chasing market share. It's surprising that you can say you understand that profit is better than market share, then go and say MS need market share, when MS is clearly saying they are going for profits. It makes no sense.
    10-05-2015 11:33 PM
  15. zkyevolved's Avatar
    It's unrealistic for people to say these phones should be under $500.

    Spec wise, 950/950xl are on par with any flagships out there. Plus continuum, Windows Hello, SD card slot, exchangeable battery, dual SIM, and the expected superior camera they are truly strong competitors.

    Strategy wise, MS won't want these two phones comparable with Nexus. Nexus has always been the representative of the best budget phone, while 950/950xl aim at premium business and WP fans markets. They will be charged similar to Galaxy S6 and iphone, but a little bit lower to compete.

    My guess is $579 for 950, and $659 for 950xl.
    Samsung and Apple are GOLIATHS! Microsoft is a tiny little guppy in the smartphone industry right now. You can ask 100 people and I'm sure 99% of them won't know Microsoft is making phones now. You're saying this just because they're Microsoft. Let's make a new company called LittleFoot. Let's launch a GREAT phone that will have a tiny ecosystem at launch, great specs and a cool camera for 700 bucks! Let's see how many sell :P It'll fail and flop right on its face.

    My current phone, an LG G4, is selling for 430 euros. Top specs, ranked as one of the best camera phones, having a super display, nice build quality etc. If they can sell for 430 and have flagship specs and be a large company, then Microsoft, a larger company, can also sell for 430 or 500 and make a damn good profit. If they want market share they need to START like Samsung, with CHEAP devices that have GREAT specs. Now Samsung is resting on its laurels and charging 800 bucks for a device... what in the world... That's why I'll never buy another Samsung device again. Even an iPhone 6S plus is like 740 for 64 gb! haha. Apple, cheaper than a Samsung device? Never thought that day would come, but oh well. I'll never buy a Samsung device for that price! only because it's a HUGE chunk of money! Same thing for Microsoft. It's a phone! A PHONE....
    10-06-2015 01:22 AM
  16. Tien-Lin Chang's Avatar
    It's a phone! A PHONE....
    Nope, they will keep telling you that with continuum "It's a PC! A PC!"

    Yeah right, a PC can't run .exe means no more than a 40~130USD android smartTV stick to me.....

    Then they will scream "it continue your WORK! YOUR WORK!"

    Yeah right, with dropbox I can continue my work over all my devices. Can't see what's a big deal over this....
    mariusmuntean and libra89 like this.
    10-06-2015 01:47 AM
  17. StevoPhilo's Avatar
    The problem isn't the price. The problem is your average Joe walking into a BBY or ATT store and asking the associates for info on the WP itself. Do you think ANY of them know what WP has to offer? Heck they probably aren't aware they carried WP. I work at BBY selling computers and I have a tough time recommending them (even though I know what it does have to offer). Yes the people in the cell phone department don't even know what WP is or how it's any different. The price will get them to look, but as soon as they look at the app store or ask for help they will get redirected to a Samsung or an iPhone.
    Tien-Lin Chang likes this.
    10-06-2015 02:57 AM
  18. hemanlive's Avatar
    No company will make a loss or want to loose on profitability. Where they make that profit is a different matter altogether. Google gives away Android OS and all its suite of Apps for free. It instead makes money from search and from within those apps. It is a great business strategy that is highly successful as of now.
    Apple makes more than 50% in profit from the sales of iPhones. This includes the cost of development, R&D and Marketing etc. It also makes money from other suite of services and apps, but the phone business alone (as do other devices like the iPad, Macbook etc.) makes a pretty decent profit. Another example of a successful business model, even though it is completely different from Google.
    Microsoft, in my opinion, is a confused company. The CEO says proudly "Mobile first, Cloud First". Then he writes off the mobile business almost entirely citing it is not making enough profits. Apparently they expected more sales and a bigger market share. They need this, not to make money via phone hardware sales, but to drive revenue from the overall ecosystem (like Google). So they too start giving the OS free to other OEMs. They say they will make their own phones for now. But unlike Google, whose flagship phone costs 50% of OEM flagships, they price their devices the most. One argument is that OEMs have the room to compete with low price phones. But I don't buy this argument at all. OEM will only be interested if they see a market in it for them. For that MS, needs to sell phones at ridiculously low prices. For. e.g. the 950 and 950XL should ideally be cheaper than Nexus 6 and Nexus 6P. Further, the 550 should be just about $100 with the XL of it could be priced about 25 - 30 dollars more.
    Once it does that kind of pricing, it will entice users purely on the basis of price. Fans like me, truly believe in the windows ecosystem, particularly windows phones. I am sure that most users who get lured because of price, will be pleasantly surprised with the OS too. Now you have managed to 'delight' your customers. Gradually the market size will begin to swell. This will lure OEMs. OEMs will know of ways to build better quality phones at even lesser price points. Trust them on that. There are ample examples of how asian companies are making profits despite selling top of the line flagship phones for almost entry level prices. OR At that point MS may start increasing the prices gradually or move out of entry level completely to accommodate the OEMs. However, that point has not come as of now.
    Regardless of how sad it makes me, I am not very optimistic about future of windows phones. Provided of course MS finds a hardware partner (which again is tough given what has happened to Nokia) that truly believes in the windows phone OS and makes truly remarkable phones (think latest Galaxy or Experia or HTC phones running windows OS). Since that is unlikely, MS needs to support itself. But this does not seem to be happening.
    zkyevolved likes this.
    10-06-2015 05:29 AM
  19. chmun77's Avatar

    Since not much people will be getting Windows Phone, it will be only worse if MS is selling them at a loss if someone decided to get it. Just selling them with profits. Why incur further losses when it is not already earning?
    10-06-2015 05:47 AM
  20. MwenyeKitty's Avatar
    I agree with you. Windows Mobile has little going for it in terms of numbers (users and app developers), so it does make sense to make cents instead of dollars. Or really sell at a loss. They already wrote off $7,600,000,000 in the Nokia deal.

    CHECK THIS OUT: If they'd left Nokia be, convinced them to make Lumia 930s only and sell them for only $100 and they (Microsoft) would cover the difference, assuming the current price at ~$400, that would mean over 25 million 930s floating around at the price of a Lumia 535. Or if they chose a lower Lumia, like the 730/735 at $350, that would mean over 30 million sold at $100. But that's a bed of might-have-beens.

    I think they ought not try and make money first; they should make ground first. Then money later.
    10-06-2015 07:14 AM
  21. spazinvader's Avatar
    Already so many comments ;-) so only checked the first page and didn't bother with the rest :-P I am just giving my opinion.

    My opinion is a big No for selling devices at a loss. The customers they get(bought) through this is not going to just stick with the platform if they start selling future devices at a profit. But some one suggested, they should make profit but a margin which is just a little higher than a razor thin margin. That will be good for Microsoft in many ways, surely will be lot lesser than an iPhone or Samsung Galaxy and a lot more affordable by me :-P

    MS just needs to make sure that all of it's near 3% market share stay with the ecosystem first. That too with a flagship. In the ocean of Android and iPhone, even if the Windows phone user survives normally everyday, be it at college, work place, etc, others will definitely notice the Windows user. Add to the mix that Windows phone users generally gets more battery time than others, productivity apps for free(mainly Office; but others will come gradually as the core is now same and easier for universal apps to be written), others will definitely switch in the long run. The core fans of Android or iPhone will not switch. Even if they were given the phones for free. But other casual users will switch if the phone looks different enough and productive.

    Productive not in the sense of work but also music, video, games and all other things that should be present to engage the user all times of the day. So Groove music and Film & Tv will also play a part. And this got me worried a lot. But they are improving faster than before and hopefully they will be great to use by next year.
    libra89 likes this.
    10-06-2015 07:46 AM
  22. tgp's Avatar

    Since not much people will be getting Windows Phone, it will be only worse if MS is selling them at a loss if someone decided to get it. Just selling them with profits. Why incur further losses when it is not already earning?
    True. Part of the equation is recouping R&D expense. That is a fixed cost, that is the same whether you sell one phone or 1 billion phones (looking at it simplistically). The more you sell, the less the cost per device. As long as Microsoft is at least getting production cost back, anything above that is a gain.

    As a5cent said in a post somewhere, Microsoft is probably not going to ever make a profit on this batch of phones. If they sell them for a high margin over production cost, the profit per device (not counting R&D) will be higher but there are less to spread out R&D cost. A lower price will reduce the profit margin (again ignoring R&D), but there will be more sales to spread out R&D cost.

    The R&D cost is spent. It's already been paid. How many phones Microsoft sells now doesn't change the cost. They might as well price them to make a profit over production cost. Retailers try to figure out at what price any given product will give them the most overall profit: high margin/low volume or low margin/high volume. Microsoft might as well do that same with this new batch of W10M devices.
    libra89, a5cent and GCrane1982 like this.
    10-06-2015 08:14 AM
  23. Nishant Sirohi's Avatar
    Well not at loss, but slim margins perhaps.
    At least in India, they need to have the devices available at multi brand stores, and considering they have been pushing low cost devices, their ads are simply useless, i mean the lumia 535 ad on tv had nothing but a spanish song playing in the background
    10-06-2015 10:04 AM
  24. HoosierDaddy's Avatar
    $550 and $650 for the 950s. I'm in for an XL. Cheaper than the 1520 MSRP.

    $130 for the 550! And I thought the 640 was a great deal. If T-Mobile and AT&T sell those the street price could be $75 or less.
    libra89 likes this.
    10-06-2015 10:56 AM
  25. MikeSo's Avatar
    It's unrealistic for people to say these phones should be under $500.

    Spec wise, 950/950xl are on par with any flagships out there. Plus continuum, Windows Hello, SD card slot, exchangeable battery, dual SIM, and the expected superior camera they are truly strong competitors.

    Strategy wise, MS won't want these two phones comparable with Nexus. Nexus has always been the representative of the best budget phone, while 950/950xl aim at premium business and WP fans markets. They will be charged similar to Galaxy S6 and iphone, but a little bit lower to compete.

    My guess is $579 for 950, and $659 for 950xl.
    Hey, good guess! It ended up being $549 and $649. I personally think they needed to be at least $100 below that to compete. But it's not a crazy price at least like it would've been if they priced it like the S6 Edge Plus or iPhone 6 Plus.
    10-06-2015 11:16 AM
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