Are We Witnessing the Slow Demise of Windows?

When Apple (NASDAQ: AAPL  ) made Mavericks a free OS upgrade, it put tremendous pressure on Microsoft (NASDAQ: MSFT  ) , Fool contributor Tim Beyers says in the following video.

How so? Mr. Softy is now the lone seller of operating system software as a separate product. That won't change soon, either. Microsoft's Windows Division is the company's third-largest unit, having supplied some $18.6 billion in revenue in the last fiscal year.

Much of that comes from selling Windows licenses to PC makers who bundle the software with their machines. Some comes from users and businesses buying upgrade licenses. But now that Apple has followed Google's example and made OS software a free add-on to a machine, Tim says it could get a lot harder for Microsoft to keep that revenue stream flowing.

Should investors sell now and look for better opportunities? Will Apple's Mavericks move help it sell more Macs? Tim answers these questions and more in the video. Please watch now, then leave a comment to let us know what you think.

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  • Report this Comment On October 24, 2013, at 8:22 PM, lw67 wrote:

    Leave it 2 you 2 find something 2 slam about MSFT. I've already posted your name as a MSFT. slammer. Tell the truth. Are you paid 2 do this by other companies like maybe Apple????? Come on admit it. Do you know what pond scum is??? Analyst my butt. If so you are a poor excuse for one. grrrrr.

  • Report this Comment On October 24, 2013, at 8:28 PM, techy46 wrote:

    Apple scamming everybody by overcharging for hardware and giving their software for "free". Google runs the same game but makes their revenue off of advertising clicks.

    MS is the only one of the major three device ecosystems, Android, iOS/OSx and Windows, that has both consumer and enterprise eco,systems. I dare someone to try to build an enterprise application architecture using only Android or Apple devices and software

  • Report this Comment On October 24, 2013, at 11:34 PM, iFool wrote:

    "Much of that comes from selling Windows licenses to PC makers who bundle the software with their machines. Some comes from users and businesses buying upgrade licenses."

    Do you just making an assumption or got this invalidate info from another "analyst"? I don't believe it is accurate based on what I know.

    When was the last time you witness any consumer user spend a penny buying a Windows OS for his/her laptop?

    If you buy a personal laptop/desktop you already entitle to a OEM license. This is not what it contributed one of the Microsoft's main revenues.

    The Windows revenue is mostly coming from the Volume licensing which generally included both Windows Severs and workstation. Interesting or not that business corporation do double pay license depending how IT manage their purchase and renewal. Like Windows workstation license, even they have already paid the OEM license when they purchase the laptop/desktop, they pay again via the licensing agreement purchase or renewal. Yes, corporate license deal is a win win deal for Microsoft and has been like that for years...

    As for Apple, their main revenue is almost entirely from selling hardware. So the $26 of Mac OS is really nothing compared to their total revenue. It's not like Mac OS quantity sold can even be compared with Windows OS.

    Buying Apple stock, hum...I sold them last year knowing that they will have tons competitors and the most threaten one is Microsoft with the Surface tablets. I believe Apple knows that and now they are desperately playing defense, verbally. I said verbally because their product announcement a couple of days ago have nothing that can compare with Surface Pro or even just Surface RT. They know that iPad is not a productive tablet, it's not being used during business hours. Now they try to promote the $3000 MacBook to the workplace. Or they may eventually come up with a iPad Pro to compete with Microsoft. If they do, then they are playing catch up with Microsoft and who's confused?

  • Report this Comment On October 24, 2013, at 11:44 PM, ejvanzyl wrote:

    I have never seen a more unbias website than the Mohley Fool.

    you have had nothing good to say about Microsoft.

    you also only see negative thins, never acknowledge a positive change.

    live on in your sad negative world, go study about constructive criticism and then learn about integrity and write about the truth.

  • Report this Comment On October 25, 2013, at 12:39 AM, GnuRich wrote:

    Thankfully the demise is coming despite being allowed to continue the monopoly. Why can't I buy a PC at BestBuy without an MS operating system on it? I use Linux, why do I have to pay a tax to King Bill?

  • Report this Comment On October 25, 2013, at 5:15 AM, nivadia274 wrote:

    Your articles are so biased against Microsoft you MUST be getting paid by another company. It's really hard and almost saddening for me to know this is looked at as a legitimate, informed article. My last time commenting as I don't even want this website receiving the ad revenue for my typing this.

  • Report this Comment On October 25, 2013, at 5:38 AM, ElHombre55 wrote:

    From the "demand" POV: Look at the office worker. He/she costs from $50,000 to $200,000 per year in salary and bennies.

    Windows adds a few hundred dollars every few years, compared to Linux. That won't cover a day of training or lost productivity, let alone calls to IT due to problems, or the costs of switching to Linux apps.

    Compared to the Mac, the extra hardware cost outweighs the cost of Windows, let alone the costs of switching to Mac apps.

    Or, look from the supply POV: Apple still pays the expense of developing Mac OS. They will recover their costs in the form of higher prices (or lower profits - but that's not Apple's style!). Since Mac PC sales are fewer than Windows, cost per unit must higher.

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