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May 22, 2006

Microsoft embraces “utility computing”

Posted by David Hunter at 11:12 PM ET.

Not that Software as a Service (SaaS) kind of utility computing that was all the rage during the dotcom boom, though. Instead, it’s a scheme where consumers “pay as you go” to use a personal computer and Microsoft’s OS:

Microsoft Corp. today announced the industry’s first pay-as-you-go personal computing offerings powered by Microsoft® FlexGo™ technology, enabling more-flexible Microsoft Windows®-based PC purchasing options for customers in emerging markets. Customers can get a full featured Windows-enabled PC with low entry costs that they can access using prepaid cards or through a monthly subscription.

The pay-as-you-go business model makes PCs more accessible by dramatically reducing the entry cost and enabling customers to pay for their computer as they use it, through the purchase of prepaid cards.

All of which brings to mind a different kind of utility:

Chip firms AMD and Intel obviously believe that Microsoft has the answer to markets so far they’ve failed to help because of the cost of materials. Flex Go lets people buy scratch cards for their cheap PCs which will let them use PCs for a certain period of time. A bit like the old electricity meters used in the UK. But it was incredibly frustrating when the lights went out and you couldn’t find a shilling to finish what you wanted to do.

Microsoft has lined up a number of partners for this play and while it gets points for innovation in the battle against software piracy in 3rd world countries, I tend to regard it like the Windows XP Starter Editions as mostly a political and public relations play with not much hope for widespread adoption. Like the Starter editions it presupposes a certain lack of sophistication in the targeted consumers which I doubt exists.

The announcement did clear up one question though:

Remember Transmeta Corp.’s secretive deal to develop a version of its Efficeon chip for Microsoft? The mystery of that project has now been solved — and it’s not a portable Xbox, or anything else along those lines. The specialized chip was designed for Microsoft’s new “FlexGo” pay-as-you-go initiative for PCs in developing nations.

We previously mentioned the Transmeta mystery project here.

Filed under Coopetition, General Business, Governmental Relations, Legal, Licensing, Marketing, Microsoft, OS - Client, Piracy, Public Relations, Transmeta, XP Starter Edition

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One Response to “Microsoft embraces “utility computing””

  1. Microsoft Weekly Miscellany, September 15, 2006 -- Microsoft News Tracker Says:

    [...] We mentioned FlexGo previously here. Filed under Open Source, Legal, Patents, Internet Explorer, Technologies, Web Services, General Business, Piracy, Public Relations, Marketing, Microsoft, Patent Lawsuits   [Permalink] [TrackBack] [...]

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