Microsoft just announced the coming of a new edition of Windows 8.1 for low cost devices called Windows 8.1 with Bing. The goal of this SKU is to reduce the overall cost of low price machines, making Windows PCs more accessible.
I talked with one of my colleagues who manages our consumer device market, spanning Windows, Chromebooks, Android, etc. He just told me that Chromebooks have 20 percent to 25 percent of the U.S. market for laptops that cost less than $300 – note that story was from 2013 so the Google gains might be larger now.
This is an important market – it’s where the education market resides. Ever hear the crude phrase: “get ‘em young and rear them as pets”? That’s what Google is trying to do … get kids into the ecosystem and keep them for life.
Microsoft has no choice but to react; they’re used to owning 90%+ of the PC market so losing an important demographic such as this is not good. Losing a large market to the Google ecosystem at such a young age makes it more difficult to win them back.
Many OEMs take payment to change the browser and search engine to something other than the default Microsoft services. Windows 8.1 with Bing will ship on devices with IE set as the default browser and Bing as the default search engine. In return, we believe that OEMs will get lower cost copies of Windows, and this will allow Windows laptops to compete against Google’s machines … and hopefully (for Microsoft) bring those young users into the Microsoft world of Bing, Outlook, and more.