Steve Ballmer willing to pay $230 per Windows Phone to beat Apple iPhone, Google Android

“The question investors, technologists and strategists have long been asking is, ‘What is Steve Ballmer willing to pay to beat Apple and Google?’ Now we have a small part of the answer, $230 per cell phone,” Nigam Arora writes for Forbes. “Microsoft is in a venture with Nokia to gain market share for Windows phones in its battle with Google Android. In the last quarter, Microsoft paid $250 million to Nokia.”

Arora writes, “The $230 number shows desperation, and there is no doubt that the Windows phone will live or die based on how well Nokia does. How does Microsoft justify taking such a loss? With about $50 billion in cash, $250 million is peanuts for Microsoft. Microsoft simply fell behind Apple and Google, and Ballmer recognizes that a big price has to be paid to catch up. The shocker is that AT&T may price the phone at $99 with a two-year contract. The low price is a game changer. At present, comparable phones from Apple and Samsung are priced at $199 with a two year contract… One thing is for certain, introducing Lumia 900 at such a low price is like stomping on the downtrodden RIM.”

Read more in the full article here.

MacDailyNews Take: AT&T offers the 8GB iPhone 4 for $99 with contract. No Windows Phone can compete with the iPhone 4 and the massive ecosystem behind it; 555,000+ apps, too many cases to count, automobile integration, etc., etc. Windows Phone just may drive the wooden stake into the un-beating, blackberry heart of RIM, but it’s real challenge is to begin eating Android share. As Android gets more expensive and loses features due to patent infringement cases and settlements, the iPhone wannabe assemblers of the world will need something to load onto their wares in the vain hope of competing with Apple’s relentless pace of innovation.

[Thanks to MacDailyNews Reader “GetMeOnTop” for the heads up.]

43 Comments

  1. It all seems bass-ackwards to me… paying the company that is making the device to market the device that uses your firmware to sell it to customers you hope will access your services and spend money on your other products? I would understand if they were paying nokia to build a phone for them that is compatible with their system etc, and then Microshit does the marketing etc, but this is messed up…

  2. At some point, when the subsidy gets too large, this can no longer be legal, on anticompetitivity grounds. This is not the same thing as a provider subsidy, which is only a way of prefinancing the 2 year captive cell phone contract.

    The Microsoft subsidy cannot exceed the Windows Mobile license fees, or M$ would be selling with a loss. Such an approach is prohibited in Europe. This won’t fly in quite a number of countries.

  3. Well write the obituary RIM. My company is (Finally!) getting ready to move to the iPhone from RIM. The most significant issue is how to transition, because it is expected that everyone will show up on day one ready to trade in their BB.

    My experience is that my company is at the end of the parade with regard to Tech, and it is now clear that BB is ready for the funeral, and organist is warming up.

  4. Guess the problem is they can’t copy anybody anymore!
    They are so far behind in the game that catching up is their biggest problem, Balmer should give it up, He has no strategy,
    He never did!

    1. No, no, no! The man is doing a fine job! A fine job indeed! Nothing wrong here…..he’s a visionary……he’s a genius…..he’s a……

      Oh heck, I can’t even keep typing this with a straight face.

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.