Recently we’ve heard rumors that Microsoft might be planning versions of WP and Windows RT that do away with the the licensing costs, and instead make back the money by in-app ads, and pushing their bundled services such as Skydrive and Skype. Microsoft and Nokia however have never actually commented on the individual cost of each WP/RT license, making many wonder exactly how expensive/cheap each device costs to push out the door.
However we at MNB can report that a source familiar with Microsoft’s licensing scheme have shared the prices of the respective licences with us. A single Windows Phone 8 license costs close to $25 per device (or £15); a Windows RT license with the Office suite (like what the Lumia 2520 would come with) costs $90 per device (or £55).
Although $25 might not sound like much for a $500 device, it certainly makes a huge impact at the lower end of the spectrum, with devices such as the Lumia 520 and 525. Effectively getting rid of these licensing fees could drop the price an extra $25 without affecting the profit margins for Nokia; and seeing that the Lumia 520’s biggest selling point was its price, imagine what would happen if it were $25 cheaper. Currently Amazon are running a promotion on the Lumia 520 selling it for only $50 off contract), which could theoretically be $25 if the licensing fees were removed.
Although WP8 already reached a very low price-point this price-point could still be pushed further, without compromising on the performance of the devices; provided Microsoft change their licensing strategy. Something that would benefit OEMs greatly, and make WP a more attractive choice for budget smartphones; we’ll have to wait and see if Microsoft will indeed slash their prices, but at least we know what it costs to make a WP device.