Windows 8 to increase PC production costs

Windows 8 to increase PC production costs

Summary: ODMs and brand vendors squabble over who will cover the additional costs.

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Microsoft's new Windows 8 OA 3.0 verification system will add complication and costs for ODMs (Original Device Manufacturers) who create and build PCs for the big name OEMs (Original Equipment Manufacturers). These costs will, undoubtedly, be passed on to us, the consumers.

Note: The DigiTimes piece inaccurately refers to OA 3.0 as being incorporated into the BIOS. What we are actually talking about here is UEFI firmware, which all Windows 8 certified systems must have.

According to DigiTimes, the issue revolves around Microsoft's new activation system for Windows 8.

For the OA 3.0, Microsoft plans to pre-install the Windows 8 operating system into PC's BIOS and will have consumers key-in the authorization key to activate the software through an Internet connection and will completely abandon its previous method of using a COA [Certificate of Authenticity] label.

OEM BIOS activation is nothing new. OA was first seen in Windows XP, and OA 2.0 with Windows Vista and Windows 7. Both of these mechanisms are now easily bypassed by pirates looking to install/sell unlicences copies of Windows.

However, now rather than shipping PCs with a COA, keys will be incorporated in the system's UEFI firmware, and this will increase production costs for ODMs because each machine will require individual attention to squirt the key into the UFI firmware (rather than just sticking on the COA). Technicians will also require more training. Finally, the absence of a certificate on the machine could also increase costs because of installation overlap (Microsoft charges a per-install fee, so having to install a second key because of an error would increase costs.

There's also concern about who will bear these extra costs:

The sources also revealed that the ODMs believe Microsoft is playing a two-faced game with the notebook players - on the one hand, the software giant has told notebook ODMs that brand vendors will pay all the increased cost, while they told the brand vendors that ODMs will be responsible for the cost.

One thing is for sure ... you and I will be the ones ultimately footing this bill.

(Image credit: jollyUK)

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Topics: Operating Systems, Hardware, Microsoft, Software, Windows

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155 comments
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  • RE: Windows 8 to increase PC production costs

    To compete with Apple Microsoft needs to tighten its control over OEMs and ODMs. This will be extra cost but I beleive in the end we will get much better products.
    The cloud guy
    • RE: Windows 8 to increase PC production costs

      @hakanern Hahahahahahaha

      Oh wait.. You are serious.
      nucrash
      • Don't underestimate the power

        @nucrash Got to be joking - There will be no 'controlling' the ODM or the brand vendor as they wield incredible power over suppliers (which M$ is, althoughthey -think- they are the apex organism). Day to day with ODM can be like dealing with Darth Vader at times. He was joking, right? or..
        opcom
    • The ODMs OEMs will be stuck ....

      @hakanern
      ....because I WILL NOT pay extra for a Win 8 certified system!
      kd5auq
    • RE: Windows 8 to increase PC production costs

      Oh boy, the first shill has spoken!
      ScorpioBlue
      • Then quit talking

        @ScorpioBlue
        and we won't have that problem.
        William Farrell
      • Nope

        @William Farrell
        Now why would I do any favors for you? Hmm?

        But if you really want to help [b]me[/b] out then please speak to the FSF and ask them to give me a raise. I really need it, man. Bad.

        lol... :D
        ScorpioBlue
  • Yet, New Technology *always* increases production cost

    Yes?
    Of course!
    Dietrich T. Schmitz *Your
    • RE: Windows 8 to increase PC production costs

      @Dietrich T. Schmitz * Your Linux Advocate

      +1
      daftkey
    • RE: Windows 8 to increase PC production costs

      @Dietrich

      Rarely do I agree with you, but . . .

      I agree. Totally. New tech always increases costs at first. Not much different than increasing the system requirements.
      CobraA1
      • It's always like that

        @CobraA1

        Until sales are ramped up to meet production costs, the production costs are always higher.
        Joe_Raby
      • RE: Windows 8 to increase PC production costs

        @CobraA1
        If that were true, why is it that Apple is able to release new versions of devices (new hardware and software) at the same or cheaper prices?
        Wakemewhentrollsgone
      • In electronics, new tech = lower cost

        @CobraA1 I observe the opposite! new MP3 players have more RAM and cost less. Another example, with $1000 it is possible to build a very powerful desktop computer. A $2000+ desktop computer 10 years ago is now worthless.
        RelaxWalk
      • RE: Windows 8 to increase PC production costs

        @CobraA1
        The second hand PC market will take a nose dive in a few years when everybody realizes that the cannot refurbish them anymore. So in the long run MS will still win...
        So the next big open source move should be to liberate the BIOS!!!
        Johan Safari
      • RE: Windows 8 to increase PC production costs

        "If that were true, why is it that Apple is able to release new versions of devices (new hardware and software) at the same or cheaper prices?"

        Cheaper than what? Last year's model, which is still more expensive than anybody else?
        CobraA1
      • RE: Windows 8 to increase PC production costs

        "new MP3 players have more RAM and cost less."

        Yes, after the initial price hike, price tends to go down. I'm not disputing that. Once things are in mass production (and MP3 players and RAM are very much in mass production, and have been for a while), prices go down.
        CobraA1
    • RE: Windows 8 to increase PC production costs

      @Dietrich T. Schmitz * Your Linux Advocate
      +1
      Ram U
    • However

      If what is said in the story is an accurate description of the problem, it's not a cost of a new piece of gadgetry in a new pc that's the issue, but rather a time/annoyance issue that would be generated on the production line. Now that would be a serious bit of slap and tickle for the OEM's to deal with.
      ego.sum.stig
      • RE: Windows 8 to increase PC production costs

        @ego.sum.stig@...

        - The assumtion is that someone will be standing there keying in these codes manually, when the truth is that someone will write a script or piece of software that loads and parses a text file with the codes and batch update the firmware. Intial cost for the script or software, maybe a day. After that, it probably takes half an hour to update the firmware 5000 times.

        Total cost to OEM: Under $1000. If the OEM sells 2000 computers, thats a $0.50 price hit.

        This, in my opinion, is much ado about nothing.
        PollyProteus
      • I'd offer this opinion

        You probably don't know how much a "little change" like this makes to a production line. It might seem trivial until you have to do it, then the "surprises" begin.
        ego.sum.stig