Microsoft to expand cheap Windows software offer

Microsoft plans to provide the cheaper Windows XP Starter Edition to more countries, aiming to prevent Linux from gaining more marketshare.

Will Poole, senoir vice president of Microsoft's Windows Client group, said that Windows XP Starter Edition is a version of the OS designed for a specific market that is easy to use, support and sell. He also said that the lower price appropriates for the emerging market needs

Microsoft is already working with governments in Thailand, Malaysia and Indonesia to offer this cheaper Windows XP version.

Microsoft has identified emerging markets as a major sales opportunity partly because PC penetration in those countries is low. In the U.S. about 60 percent of households have a PC, in Western Europe about 30 percent have a PC, but in India the figure is below 2 percent, while Russia and China are below 5 percent and Brazil is at about 10 percent, Poole said, citing IDC figures.

However, software piracy is rife in the same emerging markets. Microsoft estimates that 92 percent of the PCs sold in China have unlicensed, pirated copies of Windows. That compares to 22 percent in the U.S., Poole said. Also, competition from open-source products, specifically the Linux operating system, is strong in the emerging markets.

Windows is not the only group seeking to conquer emerging markets. Microsoft's Office group is also working to win more customers in those countries through "tailored and market specific offerings," said Steven Sinofsky, a senior vice president in Microsoft's Office group. In China, for example, Office includes an English writing assistant, he said.

Microsoft generally uses a system where its products have the same pricing all around the world, but the company said that it's rethinking this strategy. Windows XP Starter Edition is part of this.

According to Microsoft the Starter Edition is not a stripped-down version of Windows, but a tailored version in local languages.

As part of the Malaysian program, for example, Microsoft offers a localized and specific Windows XP Home Bahasa Melayu version. The software bundle for the cheap PCs also includes the English version of Works Suite, the vendor has said.

The Malaysian PC Gemilang program offers two PC models, one with the special Windows version and Works priced at 1,147 Malaysian Ringgit (US$302), and one running Linux and the OpenOffice productivity suite for 988 Malaysian Ringgit, the online edition of Malaysia's Star newspaper reported in March.

Source: InfoWorld