Windows 8.1 with Bing is free for OEMs making Intel-based tablets that are 9 inches or smaller, $15 for larger tablets
How much does Microsoft make from PC makers with Windows 8.1? — Summary:Microsoft is making Windows 8.1 available to its PC partners for anywhere from ‘zero dollars’ to $15 per copy …
Context & Ripple Effects
Two weeks after Asus put a $300 Surface-like Transformer Book Chi lineup on the market, Microsoft has disclosed what those devices actually pay for Windows: zero dollars on Intel-based tablets of 9 inches or smaller, $15 above that. The tiered price sheet confirms the small tablet is now a loss-leader category for the OS itself.
The giveaway fits an arc the related coverage makes explicit: months later Microsoft extended the same sub-10-inch logic by making Office free for devices under 10 inches, and by 2016 it was pricing Windows 10 Enterprise as a subscription at $84 per user per year — the revenue model replacing per-copy license fees.
First-order effects
- OEMs shipping small Intel tablets get Windows 8.1 with Bing at zero license cost, directly lowering the bill of materials on price-sensitive devices like the $300 Asus Chi line; larger tablets still carry the $15 per-copy fee.
Second-order effects
- With the license cost eliminated below 9 inches, OEM competition shifts entirely to hardware pricing and differentiation at that size point, while Microsoft recovers the forgone fees by pushing paid Office and cloud services onto the same devices.
Third-order effects
- If the free-OS-plus-paid-services pattern holds, per-copy Windows licensing fades as a revenue line and is replaced by per-user subscriptions — the structure Microsoft formalized with Windows 10 Enterprise E3/E3 pricing and monthly Surface payment plans.
The trend: PC operating system economics are shifting from charging OEMs per copy to giving the OS away at the small end and monetizing users through Office, cloud, and enterprise subscriptions.