SPOT Data Service, Pricing

Users of Smart Personal Objects Technology (SPOT) watches, slated for availability by the end of 2003, will have to pay a periodic fee to receive data, Microsoft has revealed. MSN Direct, a forthcoming broadcast data service for SPOT watches, will cost US$10 per month with the first month free, or US$59 per year; the watches are expected to cost between US$100 and US$300. MSN Direct will allow users to receive information such as news, weather, traffic reports, sports scores, appointment reminders, and personal text messages sent via the .NET Messenger service, and will be available in approximately 100 North American cities. Users will be able to customize the information they wish to receive—including defining the contacts who may send them messages—through a Web site.

Unlike most other wireless service providers, Microsoft cannot subsidize the cost of running data services with money from more popular voice services. Thus, MSN Direct is not a bargain compared with many other wireless data services. For instance, Verizon offers two-way text-messaging with up to 600 messages per month for only US$9; AT&T Wireless charges as little as US$8 per month for two-way data services, including complete access to Outlook or Lotus Notes e-mail and calendars and limited Web browsing (although limits on data transfer sizes apply and wireless voice services must also be purchased separately). MSN Direct’s relatively high pricing could limit adoption and might make it difficult for Microsoft to convince manufacturers to roll out other SPOT devices, such as alarm clocks.