Microsoft has reportedly raised the price PC manufacturers pay to license Windows, adding another expense at a time when computer makers are already dealing with higher component costs. If the report is accurate, perhaps PC makers should start asking themselves an uncomfortable question: Why keep paying Microsoft when Linux is free?
I came across the report on Slashdot, which linked to a story from Taiwan’s Economic Daily News. According to that report, Microsoft increased its Windows OEM licensing fees in July, with the average increase landing somewhere between 7 and 10 percent.
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The information comes from unnamed executives in the PC industry, so the numbers should be treated with some caution. Microsoft does not appear to have publicly announced the increase, and the report does not provide a new official Windows OEM pricing schedule.
One PC manufacturer reportedly said Microsoft adjusts OEM Windows licensing fees every year, but previous increases generally remained in the single digits. This year’s reported 7 to 10 percent increase would therefore be larger than what manufacturers have typically experienced.
The report also says Windows licensing costs can vary depending on the processor inside a PC. A machine using an Intel Core i3, Core i5, or Core i7 processor, for example, may carry a different Windows licensing cost, meaning the effect of Microsoft’s reported increase will not necessarily be identical across every computer.
Unfortunately for PC buyers, Windows is only one piece of the problem. Manufacturers have also been struggling with rising prices for memory, SSDs, processors, and other components, with demand from the AI infrastructure market placing additional pressure on parts of the supply chain.
Memory has been a particularly expensive problem, according to the report. When those hardware increases are combined with higher Windows licensing costs, PC makers face additional pressure to either absorb the expenses or pass at least some of them along to customers.
Consumers are already seeing higher prices in some markets. In Taiwan, ASUS and Acer reportedly expect PC prices to increase by around 5 percent, or otherwise within the single-digit range, during the third quarter.
An ASUS executive previously indicated that prices for some of the company’s products had already climbed nearly 30 percent by May compared with the fourth quarter of 2025. Another round of price adjustments could make upgrading an increasingly expensive proposition.
This is also where Linux deserves a serious look from PC manufacturers. Fedora, Ubuntu, Linux Mint, and other distributions can provide a capable desktop operating system without requiring an OEM to purchase a Windows license for every machine it ships.
The software situation on Linux isn’t what it was a decade ago, either. Even ChatGPT now has an official desktop app for Linux, something that would have sounded rather unlikely not too long ago. For buyers who spend much of their day in a browser and increasingly rely on cross-platform services, choosing Linux doesn’t necessarily require the compromises it once did.
Obviously, switching to Linux isn’t as simple as deleting Windows and knocking a few bucks off the price. Windows remains dominant on desktop PCs, many buyers expect it, and compatibility with certain applications, games, peripherals, and corporate environments can still make Microsoft’s operating system necessary.
But that doesn’t mean every PC needs Windows. Manufacturers could offer more Linux configurations alongside their Windows models, particularly on developer laptops, inexpensive desktops, mini PCs, and machines aimed at buyers who primarily live in a web browser.
More Linux options could also introduce some badly needed competition at the operating system level. If Microsoft knows manufacturers will simply accept licensing increases because Windows is effectively mandatory, there isn’t much pressure for it to keep those costs down.
A 7 to 10 percent increase in an OEM Windows license doesn’t mean the retail price of a PC will rise by the same percentage. The operating system represents only one part of the total manufacturing cost, and PC makers negotiate licensing agreements with Microsoft that consumers generally never see.
Until Microsoft confirms the change or additional documentation emerges, the exact size and scope of the reported increase should be considered unverified. If the Taiwanese report is accurate, however, PC manufacturers have another reason to give Linux a chance, and with major services such as ChatGPT embracing the platform, the old excuses for ignoring Linux are getting harder to defend.
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