Microsoft Testing Pay-by-the-Hour PCs
Microsoft developed technology for people to pay by the hour to use
a computer in their own homes.
Microsoft Corp. has developed technology for people to pay by the hour to use
a computer in their own homes, similar to the way many people use pre-paid cards
for cell phones.
The technology, called FlexGo, will be used as part of efforts to sell computers
to lower-income consumers in developing countries, where Microsoft is eager
to find new money-making opportunities but is battling software piracy and other
Microsoft, working with computer maker Lenovo Group Ltd. and
others, plans to launch a second trial of the FlexGo plan in Brazil beginning
Monday. In the next 90 days, it will launch in Mexico, China, Russia and India.
The program will generally work like this: a user will pay for about half the
cost of the computer upfront, and then will purchase pre-paid cards to get hourly
access to the computer at home. If the pre-paid card runs out and the user doesn't
buy more hours, the computer stops working until the user buys another card.
The pre-paid hours will go toward paying off the computer, said Will Poole,
a senior vice president in charge of Microsoft's market expansion group. The
financing models and interest rates will vary depending on the market, so he
couldn't say how much more than the retail price the user will end up paying.
The users will need at least occasional dial-up Internet access to participate
in the program. It will initially feature mid-range PCs running the consumer
version of Windows. But Poole said it also may
eventually include other models, such as those using Microsoft's scaled-back
Windows XP Starter Edition or higher-end ones running a media-centric version
Microsoft also will work with telecommunication companies in several countries
to offer computers via subscription.
Microsoft will make the same amount of money off these models as it does with
traditional sales, Poole said.
FlexGo is one of several ways Microsoft has tried in recent years to make more
money in emerging markets, where it sees potential to increase revenue as more
developed markets for Windows grow saturated.