Aligning its strategy with other major operating system providers, Microsoft Corporation (NASDAQ:MSFT) has decided to offer Windows 10 as a free upgrade. The operating system would be available for upgrade for Windows and Windows Phone devices, as the company struggles to retain mobile users. In addition to it, the technology company launched Windows Holographic headset with gesture control technology.
Microsoft has altered the Windows distribution strategy in the wake of its falling operating system market share. Windows has a 15 percent device share including phone and tablets unlike its previous dominance of the market. Other major competitors including Google Inc (NASDAQ:GOOGL) and Apple Inc. (NASDAQ:AAPL) offer timely updates free of cost to its customers.
According to Daniel Ives, FBR Capital Markets analyst, Microsoft Corporation (NASDAQ:MSFT) has realized that increasing the revenue streams coincides with upgrades and that is the area it needs to work on. He further added,
“Microsoft needs to lay seeds for its cloud-centric strategy and Windows 10 is the epicenter of that strategy. It’s all about making it attractive for the ecosystem to upgrade onto this next-generation platform.”
In addition to it, the ‘free upgrade’ strategy is not likely to hurt the revenues of the company, as it generates only $500 million in upgrade revenues annually. Microsoft Corporation (NASDAQ:MSFT) would offer free upgrades for the next one year for Windows 7, Windows 8, and Windows 8.1 users.
What was more surprising included a new product launch from company called Windows Holographic, which allows users to view three-dimensional versions of computer images. Microsoft Corporation (NASDAQ:MSFT) claims that the device has the potential to process terabytes of information and offer projections relevant to the user’s environment. The company is likely to launch this device along with Windows 10 only.
As of now, the shares of Microsoft Corp are trading at $45.92 with current P/E ratio of 17.99.
This article has been written by Prakash Pandey.
