Microsoft have taken an aggressive route as far as the Windows operating system is concerned. Moves like making Windows free and affordable for hardware manufacturers are recent examples.

At the same time, the company is working to bring more touch enabled devices to the market.

But this trend of subsidizing license costs is about to affect the software titan’s sales directly, positive and negative. Chances are that Microsoft’s revenue will be affected, but on the flipside, the number of licenses sold is very likely set to grow — ultimately boosting market share.

In a note to investors, Trefin analysts claim that the cost of Windows licensing per PC is to drop significantly in the coming years, and could hit the levels of $42 by the year 2020:

“This should help stem the decline in OS market share as the company will be able to limit client migration. Currently, Microsoft has approximately 78% market share in the operating system space, and we expect that to stabilize at 75% by 20.”

Interesting forecast, to say the least.

Failing PC shipments and decline in demand for traditional hardware is a reality, even as Microsoft continues on its path to transition to a devices and services approach.

Surface tablets, however, will have a very big role to play, if the company is to maintain its market share and increase revenues. These branded slates set the trend for other hardware vendors, and although the figures above are just estimates, fact is that Microsoft is aggressively perusing hardware success.

Success that ultimately ties into future growth in more areas than one.

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  • terry10

    They seem pretty content at letting their market share drop to 75% by 2020. I know 75% is still huge, but dropping 3% points is pretty significant in my opinion.

  • WillyThePooh

    I thought windows has about 90% market share instead of 78%.

    • Wayne S

      I thought the same. I really don’t trust that quote. 1. I don’t think the numbers are right. 2. It makes no mention of licensing cost.