Microsoft intros pay-as-you-go computing

Microsoft FlexGo provides access to Windows-enabled PCs using prepaid cards or a monthly subscription

Microsoft has unveiled a pay-as-you-go service designed to "dramatically reduce" the entry cost of owning a computer for people in emerging markets.

Based on Redmond's FlexGo technology, the offering provides access to Windows-enabled PCs using prepaid cards or a monthly subscription.

FlexGo is designed to align hardware, software and service offerings to meter PC usage time. The technology informs users of time used, showing them how to add more hours by typing in a number from a prepaid card.

If time is not added, the PC gradually moves into a "reserve tank" or limited-access state until customers purchase more time either online or at a local vendor. The PC is owned outright after a set number of hours are purchased.

Microsoft said that using FlexGo enables providers to reduce the entry costs of PC ownership by 50 per cent or more, and to provide a flexible approach to paying for the remaining cost of the PC.

Market trials of the service are starting in emerging markets where, according to Microsoft, inadequate access to consumer credit, unpredictable income and high entry costs prevent many consumers from purchasing a computer.

"There are more than one billion prepaid mobile phones used around the world, so we know that FlexGo enables a familiar and comfortable pay-as-you-go model that works for people with variable or unpredictable incomes," said Will Poole, senior vice president of the Market Expansion Group at Microsoft.

Microsoft recently completed a successful year-long market trial of pay-as-you-go offerings in Brazil with national retailer Magazine Luiza.

Partners including AMD, HSBC Bank Brasil, Infineon Technologies, Intel, Lenovo, Phoenix Technologies and Transmeta will join Microsoft for the next round of trials in Brazil, China, Hungary, India, Mexico, Russia, Slovenia and Vietnam.

Together with the International Finance Corp (the private-sector investment arm of the World Bank Group) Microsoft is exploring ways to enable its financial partners to underwrite PC purchases and prepaid cards on the most affordable terms for lower-income consumers.