Hot take: We're nearing the peak size of corporations, and in 20 years the average corporation will be smaller, rather than larger. There's a simple reason. The reason Microsoft is doing stuff like this is because they're absolutely enormous. They have baseline costs in the tens of billions of dollars. You simply can't recoup that with individual product releases, where even a breakaway hit would cover a fraction of your costs for a single year. You need rent, and so they're rent seeking in every possible endeavor. And many other companies are in the exact same boat.
But both advertising and direct rent (e.g. pay us $10/month for your OS license) have theoretic limits. $10/month sounds awesome (from both a creator and consumer perspective) for a product that might have otherwise cost hundreds of dollars, until you get into the domain of a million companies doing the exact same thing. $10/month * n subscriptions becomes unviable at some point, and probably a relatively low point for the vast majority of people. It's kind of similar to what happened to Netflix. As more Netflix competitors emerged (and Netflix itself began to struggle), the cost to simply watch what you want skyrocketed, and consequently - so did 'piracy.'
And similarly with advertising. People can only physically watch so many ads. And for every advertised product, the value of advertising for a new company becomes relatively less. In other words if you're the only person advertising, in existence, everybody's going to know about you. If there are a million comparable products being advertised, then even a large advertising budget may yield negligible returns.
It's a tragedy of the commons, or more precisely - of the commoner.
Surely they make a ton from their cloud services. I wouldn't think they needed to make more money from Windows over and above the license fees. This is more likely revenue optimization.
But both advertising and direct rent (e.g. pay us $10/month for your OS license) have theoretic limits. $10/month sounds awesome (from both a creator and consumer perspective) for a product that might have otherwise cost hundreds of dollars, until you get into the domain of a million companies doing the exact same thing. $10/month * n subscriptions becomes unviable at some point, and probably a relatively low point for the vast majority of people. It's kind of similar to what happened to Netflix. As more Netflix competitors emerged (and Netflix itself began to struggle), the cost to simply watch what you want skyrocketed, and consequently - so did 'piracy.'
And similarly with advertising. People can only physically watch so many ads. And for every advertised product, the value of advertising for a new company becomes relatively less. In other words if you're the only person advertising, in existence, everybody's going to know about you. If there are a million comparable products being advertised, then even a large advertising budget may yield negligible returns.
It's a tragedy of the commons, or more precisely - of the commoner.