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View Full Version : Microsoft says Smartphone OS Margins are Just Fine


Mike Temporale
02-27-2004, 08:50 PM
<div class='os_post_top_link'><a href='http://www.silicon.com/networks/mobile/0,39024665,39118617,00.htm' target='_blank'>http://www.silicon.com/networks/mobile/0,39024665,39118617,00.htm</a><br /><br /></div>"Microsoft has responded to accusations that while its Windows Mobile software for smart phones increases the revenue an operator can make off each handset, margins aren't greatly improved because support costs escalate because of frustrated end users. <br /><br />The critical metric for mobile operators has long been ARPU - average revenue per user - and Orange, prominent with several cutting-edge devices, has declared smart phones such as the SPV, using the Microsoft OS, and Handspring Treo 600, based on the Palm OS, have so far weighed in with double its typical ARPU. <br /> <br />But last week PalmSource - provider of the Palm OS - suggested <i>average margin per user suffers when a phone is Microsoft-based</i>, the implication being costly calls for technical support are more common."<br /><br />I don't know about everyone else, but I placed more technical support calls when I had a SE T68 than any other phone. I find PalmSource's comments on supporting Windows Mobile hard to swallow. Sure the phone can be a little confusing at times, but I find it works all the time, and I can usually find the settings that I'm looking for. Unlike my old T68 where it would never sync right, and it kept forgetting the internet settings. :roll: <br /><br />The most interesting part of this article to me is the following quote. "Microsoft now has over 37 licensees for its smart phone operating system". 8O If that's correct, then we should be expecting a banner year!

Neil
02-28-2004, 10:42 PM
ARPU includes any costs associated with supporting the user, such as device returns, support calls, replacement handsets, free minutes, deals, etc.

If a mobile operator says ARPU is doubled for a handset, then they really did see twice as much money go towards the bottom line than with another.

jason66223
02-29-2004, 05:20 PM
Just a thought, companies recognize revenue and margin (profit) differently. I can tell you that ARPU does not in fact include the profit or loss for each subscriber.

Neil
02-29-2004, 06:48 PM
I can go back and double-check at work on Monday, but when we were first shown this information the question about whether this included support calls and such was asked. We were specifically told that it did. I'll double-check though.