Should New Lumia Devices be sold at a loss ?

[broar94]

Lol they're not going to sell at a loss. What about marketing efforts and shipping costs?

 

[Simon Hinton]

Wasn't it said that these phones would be priced higher than iPhones?

As a New Zealander, I sincerely hope not.

iPhone 6S
16GB: NZ$1199
64GB: NZ$1399
128GB: NZ$1599

iPhone 6S Plus
16GB: NZ$1399
64GB: NZ$1599
128GB: NZ$1799

Microsoft needs to cut prices and flood the market with Windows 10, or nothing is going to change. There's only one type of consumer that would pay that amount of money for a phone, and they're never going to jump ship for the sake of a gimmicky iris scanner, or bluetooth wireless monitor stuff. Make the phones reasonably priced, and easy to develop for. Once the users are there, crank up the prices with the x86 phone. That's the device enterprise users are going to clamber for.

 

[Christopher Kendalls]

I thought they were already doing this. I only paid $40 for my 635.

 

[HoosierDaddy]

I thought they were already doing this. I only paid $40 for my 635.

And when I bought a year of Office 365 Personal, AT&T thru in a Lumia 640 for an extra $10.

 

[Jay Worley]

Agreed. No, they shouldn't sell at a loss, but the profit margin needs to be much lower compared to comparable phones. With the Nexus 6P launching at $499, Google is making money, so MS should be able to beat these prices a little.

 

[visu9211]

I think they Should... May be not at a loss but at Cost or little to no profit to gain marketshare...
Whatever they decide, I am sure they will keep the price high in Europe...

 

[Christopher Kendalls]

And when I bought a year of Office 365 Personal, AT&T thru in a Lumia 640 for an extra $10.

Yes. Microsoft tried that race to the bottom for 2 years and it didn't work. It's time to come out on top at the high end, just so that people realize that Microsoft is serious this time around, and see how it goes. I wouldn't eradicate the budget market, but I would only deliver one or two budget phones a year.

Plus the Surface isn't cheap, and I think that is part of the reason it is successful. Allow OEMs to create budget devices while Microsoft delivers top notch equipment. Microsoft needs to deliver a statement with Windows 10. I would not have given it away for free. Only top of the line new PCs, no upgrades. But I'm not Microsoft.

The reason I say that is because I believe Microsoft created a lot of confusion with the Insider Program. For developers, yes, but to allow anyone into the program, I'm not so sure. It lead to a lot of people that don't know what they're talking about pushing FUD about the OS, and false expectations. It creates an image problem for the company. Windows 10 on new smartphones only minimum 1 GB RAM no 512 MB devices at all. And I'm still not sure that upgrades to Windows 10 on older computers was a good idea. Maybe 2 GB RAM minimum but situations where legacy hardware needs to be supported I'm not so sure.

That would have crippled adoption rates, but slow and steady wins the race IMHO. Part of the issue that Microsoft has, is that everyone gets new software on equipment that is in no way near what they should be using if on. If the product is good, people will pay for it anyway.

 

[Lumious]

I've been seeing rumors that the 950XL will come in close to 1,000 and the 950 a couple hundred less. I hope these are all false because I surely will not be paying a grand for 950XL all plastic phone despite the awesome specs and continuum. Realistically I would pay as much as 700$ for the XL but hoping it is more in the 500-600 range.

The iPhone 6s plus sells for 799 (16GB) and 899 (64GB) on Best Buy... so if the 950XL is coming in close to a grand that means it would be more than the iPhone 6s plus. I don't think it's fair to compare a 32GB storage device with a 128GB iPhone that sells for 999 so I'm not comparing that. There is no 32GB version of the 6 or 6s so using the 16 and 64GB versions is the closest comparison.

The Samsung Glaxay S6 Edge plus and Note 5 sell for 799 and 699 respectively (32GB) on Best Buy. These are high end gorgeous metal devices so selling a Windows Phone that is plastic and not as good looking (despite the specs again) for the same or more than that is going to be disastrous for Microsoft. We'll see.

Just my opinion.

 

[levy shikukui]

we at Microsoft we value security ,performance and durability let the 950 come then you android and ios guy will battle you up.

 

[mariusmuntean]

The only way MS is going to really move the 950 and 950 XL is to market the hell out of them. Market them well. Market them smartly. Show people why they should buy one and what it can do. If MS does their typical **** poor marketing it will sell as well as the Icon and 930, which will do nothing for marketshare and more importantly, developer interest. I pray to God that the pricing from the link below is false.
Spanish pricing of Lumia 950 and 950 XL revealed, and its not pretty - WMPoweruser

Yes, the iPhone 6 and 6S go for a ridiculous $749 and $649, but iOS is proven, has good reputation, and apps. If the 950XL and 950 go for more than $500/?330/?450 you can kiss sales goodbye. Nobody outside of current WP users are going open up their wallet and drop this kind of coin on an unknown phone with an iffy ecosystem by a company that is still trying to climb out of a bad reputation.

prices on buyon.ru are even worse. take a look. in US$ the 950 is ~775$ and the 950xl is 865$

 

[visu9211]

They will do things differently this time. They will sell Lumia at premium (except those value devices 550) because Satya is not interested in increasing the WP market share as he said in the conference last month. They are on the lookout for whats next... MS is even increasing the support for iOS/Android at expense of their own platform.. Indeed its a new Microsoft!

 

[mariusmuntean]

I've been seeing rumors that the 950XL will come in close to 1,000 and the 950 a couple hundred less. I hope these are all false because I surely will not be paying a grand for 950XL all plastic phone despite the awesome specs and continuum. Realistically I would pay as much as 700$ for the XL but hoping it is more in the 500-600 range.

The iPhone 6s plus sells for 799 (16GB) and 899 (64GB) on Best Buy... so if the 950XL is coming in close to a grand that means it would be more than the iPhone 6s plus. I don't think it's fair to compare a 32GB storage device with a 128GB iPhone that sells for 999 so I'm not comparing that. There is no 32GB version of the 6 or 6s so using the 16 and 64GB versions is the closest comparison.

The Samsung Glaxay S6 Edge plus and Note 5 sell for 799 and 699 respectively (32GB) on Best Buy. These are high end gorgeous metal devices so selling a Windows Phone that is plastic and not as good looking (despite the specs again) for the same or more than that is going to be disastrous for Microsoft. We'll see.

Just my opinion.

Very good remark man. you cannot ask a Mercedes price for a VW.

 

[visu9211]

Security, May be.... Performance, Not so much... You still see resuming screen with Current premium phones. What makes you think that it will not be the same with WP10?
The universal App platform is not that robust/fast yet... May be in 1-2 years time, but not sure if WP will be around in any considerable way...

 

[rory753]

That would be useful to some users, but others would not get any benefit from it. None of my family or friends use Skype.

with Skype, you can currently call and recieve calls from land lines or other non-skype devices. you can also text to cell phones from skype. In other words, the person you're trying to reach doesn't need to have skype for this to work...

 

[rory753]

You would still need a carrier for the Internet access.

you mentioned google hangouts, but forgot to mention google fi. Google Fi is trying to eliminate carrier dependency, by providing access to the web from their own program. Skype wi-fi is sort of an ad-hoc version of this, and depends on wifi hot spots(not partnerships with carriers). so, if msft could make a more robust version of skype wifi, they could have a network to provide people for a connection for internet, as well as calls and text.

 

[mmcpher]

I've been pining for a new flagships almost as long as I've been pining for the fjords. I've passed on a long line of budget-priced lumias waiting for a flagship, high-end phone. In that sense, a down-priced phone would be a turn-off and could be seen as an admission of inferiority. OTOH I do not want to pay $1,000 for a phone. That's flying insanity. We'll see, of course. I worry that the CEO's diminished expectations for Microsoft phones won't be interpreted as a license to over-price, since they've already conceded market share ignominy. But I don't think its a simple loss leader situation, because recent history suggests that the masses won't be drawn to W10M at whatever price, at least not quickly and in numbers. But "loss leading" should be in the discussion, because W10M phones are a part of the overall Universal Apps and Windows as a Service Across All Your Devices.

 

[RayWP7]

Hrm, I'd say cheaper doesn't guarantee sales volume. But with Android at 80% market share, one could argue their price points has to count for something. We know low end Lumias seem to be doing well in many markets abroad. Microsoft's goal is to get the Windows 10 out there across all form factors. If they want OEMs to pick up their OS, they are going to need to give them breathing room. OEMs along with Microsoft have to be the ones that grow the market share. Microsoft cannot be the exclusive partner in driving W10 Mobile business. Pricing below competitors does seem like it could incentivize people to look at the platform, but let's face it the people who matter are those that will shell out anything for an iPhone or expensive Android handset (or lease them). And people buy these devices because of their heavy "investment" in the platform (apps, data, social), brand loyalty, and/or because they are popular. Low end market share is covered by the 500/600 family. Low end won't make Windows 10 Mobile popular. Android has carved out the niche as the alternative to iPhone'mania. The key is getting big spending trendsetters to switch. 50$, 100$, and even 250$ isn't going to sway them if they have financing options. Everything we're talking about is pure conjecture. There are several factors at play: cost, ecosystem age, platform investment, brand image, and social aspects like popularity. Cost is something Microsoft can control and I suspect they will be willing to take some loss since any new business would be driving customers into the Windows 10 ecosystem; it just won't be anything the sort taken with XBOX. Microsoft is going to position Lumia in the same way it has Surface: "this is what you can do with Microsoft software and technology." It's worked well for the Surface, if the recent and rampant imitation is any measure. My guess is that in the end Lumia 950s will be flagship product for Microsoft and they will have a strong showing but nothing will change until more OEMS jump on board. And, much to my chagrin, "major social apps" found on competing platforms must bring feature complete offerings to W10. I don't care about that stuff, but many, many people do. Read any forum posting on WPC and you can see how many people love to hate the platform just based on the "app gap" argument alone. It's silly to some like me, but it is a valid view point. We're lucky they love to hate, because at least they are paying attention; most people just don't care and aren't aware of what WP has to offer. No amount of advertising will help. This is an OEM + App Gap + Social thing now.

 

[el Jono]

I think history is going to repeat it's self with these devices. I think the 550 is going to out sell the 950 and XL for one price. I think Microsoft will have to market the 950 and XL very aggressively by highlighting what can be done on WIN 10 mobile compared to Android and IOS. I live in the Caribbean and the perception of windows phone is next to trash and that basic things can't be done compared to IOS and Android Cough!!! but actually there is some reason in it try setting a mp3 for a ringtone for example. I think Microsoft has to show what Win10 can do now in comparison to the others in relation to ease of use. Until then, I think die hards will only go for 950 and XL. Just my thoughts for now would love a 950 but my 920 will continue to the job till i can afford it but the 550 is looking a serious contender.

 

[Laura Knotek]

Hrm, I'd say cheaper doesn't guarantee sales volume. But with Android at 80% market share, one could argue their price points has to count for something. We know low end Lumias seem to be doing well in many markets abroad. Microsoft's goal is to get the Windows 10 out there across all form factors. If they want OEMs to pick up their OS, they are going to need to give them breathing room. OEMs along with Microsoft have to be the ones that grow the market share. Microsoft cannot be the exclusive partner in driving W10 Mobile business. Pricing below competitors does seem like it could incentivize people to look at the platform, but let's face it the people who matter are those that will shell out anything for an iPhone or expensive Android handset (or lease them). And people buy these devices because of their heavy "investment" in the platform (apps, data, social), brand loyalty, and/or because they are popular. Low end market share is covered by the 500/600 family. Low end won't make Windows 10 Mobile popular. Android has carved out the niche as the alternative to iPhone'mania. The key is getting big spending trendsetters to switch. 50$, 100$, and even 250$ isn't going to sway them if they have financing options. Everything we're talking about is pure conjecture. There are several factors at play: cost, ecosystem age, platform investment, brand image, and social aspects like popularity. Cost is something Microsoft can control and I suspect they will be willing to take some loss since any new business would be driving customers into the Windows 10 ecosystem; it just won't be anything the sort taken with XBOX. Microsoft is going to position Lumia in the same way it has Surface: "this is what you can do with Microsoft software and technology." It's worked well for the Surface, if the recent and rampant imitation is any measure. My guess is that in the end Lumia 950s will be flagship product for Microsoft and they will have a strong showing but nothing will change until more OEMS jump on board. And, much to my chagrin, "major social apps" found on competing platforms must bring feature complete offerings to W10. I don't care about that stuff, but many, many people do. Read any forum posting on WPC and you can see how many people love to hate the platform just based on the "app gap" argument alone. It's silly to some like me, but it is a valid view point. We're lucky they love to hate, because at least they are paying attention; most people just don't care and aren't aware of what WP has to offer. No amount of advertising will help. This is an OEM + App Gap + Social thing now.

I think that one of the main reasons why OEMs are not building Windows Phones has to do with the inability to customize the software. Most of the Android OEMs are not offering differentiation based upon hardware, but rather based upon skins and launchers. If all Android devices could only run stock Android, there would be far less OEMs and Android devices. What is the incentive for Samsung to make a device that lacks TouchWiz?

How would various OEMs differentiate their Windows Phones from the Microsoft branded devices?

 

[dharmababa]

Agreed. No, they shouldn't sell at a loss, but the profit margin needs to be much lower compared to comparable phones. With the Nexus 6P launching at $499, Google is making money, so MS should be able to beat these prices a little.

It's unclear that Google is making money on the Nexus 6P - my guess would be close to break-even. The Verge has a pretty good analysis why this may not be a good strategy for the rest of the Android ecosystem: Google's Nexus phones are just ads | The Verge.

Nevertheless, it is pretty interesting how closely matched the new Nexus devices will be to the 950/950XL. I would treat their prices at the low end of what's possible, but don't expect MS to match. iPhone pricing is the high end.

So, that would put the 950XL in the $500-$800 range. My guess is that it will be somewhere in the middle.