TECHNOLOGY : Microsoft caught in pricing dilemma

Microsoft has been grappling with the difficult task of how to expand the local market of its software products beyond government and corporate buyers.

Microsoft has been grappling with the difficult task of how to expand the local market of its software products beyond government and corporate buyers.

The challenge is pricing, the American company says.
Many individuals and small businesses find the price of genuine Microsoft software unaffordable, say analysts.

“The most viable option would be for Microsoft to cut the price of their software to make them more palatable to most individual PC owners,” said Boniface Wandera of Capital Software Ltd, a computer hardware shop in Nairobi.

Genuine Microsoft Vista operating systems range from KSh7, 500 to KSh15, 000 depending on the scale of productivity offered.

“For many buyers, if you tell them to buy software separately from the computer hardware and you quote the prices, they think you are crazy,” said a sales attendant at Sonatech Computers.

Microsoft agrees that poverty level in Kenya and in the region was pushing users to embracing counterfeits and pirated software.

But it says huge price cuts would disrupt its large markets in the developed world.

“If we reduce our prices by a large margin, parallel importation will be the most likely result,” said Andrew Waititu, licensing and compliance manager for Microsoft East & Southern Africa.

Analysts say pricing remains a challenge for the company, leaving it with the option of fighting counterfeits and piracy in low-income markets.

Business Daily Africa

 

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