We all know that Microsoft is desperate to get Windows 8 and Windows RT into the hands of consumers. They have made multiple PR pushes, dropped upgrade prices and even developed their own hardware. Everything that Microsoft has done shows calculated panic. In other words they are desperate to capture some of the market and the residual benefits that it beings (app sales etc.). We also know that with Windows 8 Microsoft will be pushing the Xbox Live service again and with their cross platform infrastructure they aim to hit as many with those monthly fees as they can.

Microsoft is also very interested in bringing people into the world of their cloud services. Again the cloud is a huge cash cow if you can get people to use it. Microsoft has spent a ton of money developing and repurposing their own services (like Azure) for this use. Just look at the direction that Office 2013 is going and you can see how much they want you in their cloud.  To this end we have a feeling that the $199 price tag will be a subsidized price with one or more subscription services. Microsoft may follow the cell phone providers and offer these products at a significantly reduced price with one or two year contracts. This is a business model that has a very long history of success. People look at the discount they get upfront and forget about the long term payments that follow. Both the Dish Network and DirecTV picked up a large number of subscribers with this type of deal and there is no reason that Microsoft cannot either.

Watch for these deals to pop up on the radar starting in October. We expect Microsoft to offer a decent selection of them so that they cover the most segments of the market (Xbox Live for gamers, SkyDrive and Office 360 for business and students, etc.). We had said it before, Windows 8/RT is all about getting you into the Microsoft cloud. The hope is that once you are there, you will not be able to get out easily.

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