Finance Geek

If you’ve been considering investing in a tablet for your child, you’ve got lots of options these days. Just do a Google search on tablets for kids and you’ll find plenty of comparisons and reviews of the various brands that are currently available.

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Google’s daily brainteaser helps hone your search skills.

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Microsoft took the wraps off its best effort to take on Apple’s iPad, dubbed Surface. Can Windows 8 and Windows RT models plus slick accessories like these keyboard/covers make a dent in Apple’s total dominance of the market? Get all the details on Microsoft’s new tablets straight from the Gadget Lab team.

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Follow The Daily Ticker on Facebook! Forty years ago, obesity was a small concern — if one at all — to governments, health care professionals and individuals. Today, obesity rates have skyrocketed around the globe and present one of the single biggest challenges, both nutritionally and economically, in recent history. Nearly 14 percent of women [...]

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Mozilla is hard at work on Firefox for the iPad, but don’t expect this to be your father’s Firefox. Instead the company is hoping to “reinvent the browser for a new form factor.”

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Follow The Daily Ticker on Facebook! We like to believe that the action in stock markets is driven by human emotions and reason — investors making decisions about the prospects of individual companies and their concerns (or hopes) for national economies and big economic trends. But from the Flash Crash of May 2010 to the [...]

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Last year, the government tweaked the HARP program in order to spur refinancing of underwater mortgages. By removing loan-to-value cap, the government allowed homeowners current on their mortgage payments the opportunity to refinance at lower rates even if their existing mortgage was bigger than the current value of the home. “These changes have been met [...]

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Follow The Daily Ticker on Facebook! Sunday’s Greek election saw a narrow victory for the “New Democracy” party, which wants to try to continue to work with the rest of the Eurozone on a bailout-plus-austerity plan. Thus, Greece and world markets dodged a potential bullet in the form of an aggressive new government that might [...]

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The excellent, but paywalled, Lex column in the FT has an interesting article today which speculates on how Microsoft will price its forthcoming releases of Windows 8 (tablet edition) and Microsoft Office. Software prices are dropping and the importance of local operating systems and having locally installed productivity software is declining which makes the future for Microsoft’s consumers software a challenging one. The interesting question is how challenging.

The biggest competitor in mobile, Google’s Android is free, and Google docs is getting better every year (although in my opinion still not up to the standards of Office for anything complicated or difficult). To keep their burn low many startups I know eschew Microsoft entirely and run on Google’s free software. For these reasons I’ve long thought that Microsoft will lose their monopoly positions in OS and productivity software and is in for a tough time.

I still think that is true but they may be able to hold pricing better than I had previously assumed.

The interesting new news, as reported in the FT, is that Bernstein Research have analysed the hidden costs of working with Android (software integration, support costs and royalties for the parts of Android that are based on Microsoft’s intellectual property) and estimate that if Windows 8 is priced at $40 per tablet it could actually be cheaper for tablet makers who ship fewer than 9m units a year, rising to $50 if Office is bundled in. Apparently that is broadly comparable with what Microsoft charges PC makers now.

If Microsoft can maintain profitability whilst their market share declines then they still have an interesting paid for software business.

The centrepiece of the ‘free’ argument is that the price of everything drops to its marginal cost of distribution. In theory software delivered over or downloaded from the web has a marginal cost that is very close to $0 and a lot of people believe that software companies of the future will derive their revenues more from support, services and hosting than licenses.

The Microsoft analysis highlights that in practice their are other costs (software integration, royalties) which can keep the marginal cost significantly above $0 hence allows for successful license based business models – this is a rehash of the total cost of ownership argument that software companies like Oracle and Microsoft have been making against open source for some time now. $40-50 isn’t that much though, and software companies with license business models will need to keep their costs low and find efficient routes to market if they are to make good profits and become very valuable.

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