Monday, May 22, 2006

Microsoft announces cheap 'pay as you go' PC's

Microsoft today announced the latest drive in an attempt to sell cheap PC's to emerging markets with the 'pay as you go' PC. The program is called FlexGo and will allow users to basically rent the core software inside a PC using a scratch card to tally and automatically charge every time they use it, instead of paying for the entire bundle up front.

This will allow a normally $600 PC to be sold out of the box for around $300 with FlexGo. The PC will recognize the scratch card you buy and take untis of money off it every time you use the PC - I guess until the point when you have repaid the $300?

The principle works similarly to that of pre-paid mobile phones, where the hardware and software costs are sold cheap, with the user paying the device off over time by using it for calls etc.

I just wonder whether Micrisift is going far enough. Surely it would be better to sell the PC for $300 and then rent the software to the user for free, subsidized by adverstising revenues rather than a prepaid scratch card. Now that would truly revolutionize the PC market.

Or maybe Google should do it in partnership with Dell. Dell could sure use the boost right now.

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