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Comment by kqp | Hacker News Reader

Why do you assume that? I’m genuinely asking. I’m aware of big companies generally paying lower rates for things, but I believe that’s usually driven by the increased leverage a big buyer has, while Asus has absolutely no leverage, if they switch to Linux today they’ll be out of business tomorrow. It certainly costs MS less to deal with one professional org than a million flaky individuals, but price is determined by supply and demand, not cost. Maybe it’s limited by calculation of its effect on Asus’ wellbeing, preserving them as a major customer?

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Asus selling millions of PCs a year that each pester their users to make a Microsoft account is well worth a major discount to them than any sort of additional OEM licensing revenue. Giving Asus cheap licenses lets them sell cheaper units to more people.

And yeah, Asus DOES need to sell windows laptops because the market demands it, but it doesn't mean they need to follow all of Microsoft's rules/goals. ("Pleeeeease put an NPU in every laptop and advertise copilot for us, pleeeease") Giving them a steep discount gives Microsoft a lever to pull if they feel like punishing an OEM later, though with the goal of avoiding anything that halts the sale of PCs with windows on it, which is bad for all parties.

You can't really model that on a supply/demand curve. Microsoft supplies Windows licenses, but Asus supplies a big chunk of market access. A license to software is an infinitely available resource which only has a value determined by the market's willingness to pay for it; a market that microsoft has historically been dogshit at accessing themselves. (Surface product line, for example)

Thank you.

Cheaper → more licenses and also more post-license profit, yes, agreed, hence my (admittedly oblique) wellness comment, but this is also true of direct to consumer prices, and my question is specifically about any price difference between the two.

PC makers intermediating other MS objectives makes sense.

Re market access, does Asus actually increase the size of the Windows market, or sell to people who’d otherwise buy Windows another way? I think you’re saying yes, a big PC maker plays a part in getting more people to buy Windows more often, and that’s the biggest thing I was missing.

That’s a narrow view to suggest it’s just Microsoft’s Copilot that’s pushing NPU’s on PCs. You need some NPU or GPU for system requirements not just for Copilot but for any local models including Gemini Nano in Chrome, open models, models running on Linux without Windows at all. Intel and AMD are both making chips with NPU’s on the die just like they have made them with integrated GPUs.

AI isn’t going away any more than graphics acceleration is. You can deliberately buy a low-power board or notebook that doesn’t have those capabilities if you want. It will save you money too.

What? I think you're latching onto something meant as a general example, as something specific. Microsoft has many goals they'd like to push on their OEMs, I'm sure. You're having a different conversation.

You can get a new Windows 11 laptop on Amazon for ~$200. If they're paying retail cost ($140) for the license, over half that is going to Microsoft. I think most people would much rather buy the equivalent Chromebook for $70. In fact, the equivalent Chromebook costs about the same.

Retail licenses are transferrable, OEM/OEI licenses aren't and are tied to that specific hardware.

Win 11 Pro OEI, $149

https://www.microcenter.com/product/643566/microsoft-windows...

Win 11 Pro Retail/FPP, $199

https://www.microcenter.com/product/669901/microsoft-windows...

I'm certain OEMs are getting volume discounts, and Microcenter is adding their own margin as well.

That’s not how OEM pricing works. Depending on the retail price and volume Microsoft will lower license cost close to $0. No large manufacturer is paying $140 to license Windows for a notebook selling $200. That’s the full retail price for a consumer building their own PC. That said usable Windows notebooks are usually a bit more than that these days. And just the RAM alone to run usable Windows 11 is pushing $70 now.

That is exactly the point of the comment you're responding to. "Why do you assume that [OEMs pay much less than retail]?" Well, $200 Windows laptops exist, and $140 of that going to a Windows license is not a credible idea.

I mean, it's also in Microsoft'S business interest to keep a major computer manufacturer like Asus selling windows machines. That's one of the main reasons windows is the default OS for most people.

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