The idea is based on combining two ideas that have proven successful in low-income nations: pay-as-you-go mobile phone plans and internet cafes.
The program, called FlexGo, will see subscribers purchasing minutes on pre-pay scratch cards, much like pre-pay phone cards. However, under Microsoft’s plan, users will own the PC outright after they have bought a certain number of minutes.
FlexGo will launch first in Brazil, where it has been in limited piloted for a year. India, Mexico, Russia and China will be added over the next several months, in partnership with local companies.
These countries were chosen due to the relatively low penetration of home PCs, the relative popularity of pre-pay mobile phones, and the relatively poor availability of consumer credit.
Microsoft, lumping together emerging markets, said 10% of households have PCs, whereas 29% have a mobile phone, 74% of which are pre-paid. In Russia, the firm said, 82% of the population have a pre-pay mobile.
In the pilot last year, the company said it sold 1,000 FlexGo machines with Brazilian retailer Magazine Luiza, more than doubling PC sales in participating stores.
FlexGo entails paying for about half of the PC street price up-front, then topping up usage time by buying 12-digit code scratch cards. When users run out of time, the machine switches to a low-functionality mode until a new code is input.
Microsoft did not disclose exact pricing for the program, which will presumably vary from market to market, and was coy on technical details of the machines that will be offered and how the pay-per-use system will be enforced.
Intel and AMD are both on board to create hardware supporting the system. OEMs, retailers and banks will be able channel the technology to customers. Lenovo, the old IBM PC business, has signed up to sell the devices in China and India.
It sounds like the machines may include Trusted Platform Modules. Microsoft said they would have hardware security technologies that make it inconvenient or costly for an individual to tamper with the components that meter computer usage.
There will be options for minutes to be provisioned locally or, in the case of a subscription package offered with internet access, over the network. Microsoft has developed a local provisioning server and provisioning server system to these ends.
On the ISP side, partners planning FlexGo subscription plans already include Videsh Sanchar Nigam Ltd in India, T-Com in Hungary, Vietnam Datacommunication Co, SiOL doo of Slovenia and Telefonica Brazil.
