“Revenue in Devices & Consumer, which includes everything from consumer Windows licenses to Surface, Xbox and Bing, grew 13 percent to $11.91 billion.
Though Windows revenue from manufacturers declined 3 percent, revenue from Surface â€” Microsoft launched the second generation of its Surface tablets in the second quarter â€” doubled from the previous quarter.”While M$’s latest quarterly report looks good for M$, it clearly shows Wintel is split right down the middle. On the one hand, M$ saved its bacon by growing sales of “surface” by $billions. On the other, its old partners, the OEMs, clearly took a big hit. M$ and everyone else are taking revenue from those OEMs. M$ has an unfair advantage against the OEMs. M$ doesn’t have to pay its own licensing fees…
What will the OEMs do? Continue as manufacturing slaves for M$ or go into business for themselves with FLOSS and GNU/Linux and Android/Linux? Wait! They are in business for themselves, right? That means in 2014 OEMs that dipped their toes in the FLOSS pool last year will plunge in. Android/Linux, Ubuntu GNU/Linux, Linpus GNU/Linux and every other kind of */Linux will be shipped in huge numbers. The consumers have shown they won’t pay retailers and OEMs to supply Wintel PCs but for ~$100 less per unit with FLOSS the flow of legacy PCs and every other kind of PCs the OEMs can produce will take off. I wonder how many of those “surfaces” still gather dust on retail shelves? Maybe the retailers took a hit as well. 😉
In case the reader is skeptical, take a look at the numbers:
|2012 Q3||2013 Q3|
|M$’s Licensing Revenue||$5.70b||$5.38b|
|M$’s Hardware Revenue||$2.81b||$4.73b|
Essentially, M$’s take from the global IT budget of consumers rose $1.6b and the OEMs’ fell… That is a huge change to the
“partnership” enslavement licence. Wintel is broken and M$ neither can nor wants to put it back together. The same thing is happening to the “resellers” who get to point businesses at M$’s cloud never to be seen again…
I’m OK with this. The “partners” of M$ will now have to work for a living and get involved with FLOSS or die. M$ can afford to become an OEM if necessary but it will also have to work for a living. Good. M$’s gross margin for consumers dropped $1b while it rose $1b for businesses. That’s the choice that has been made. Hundreds of millions of consumers freed themselves from Wintel in 2013. 2014 looks to be an even better year.