Where’s The Windows 8 “Buzz”?

by John Kirk   |   January 8th, 2013

With all the news coming out of CES this week, I couldn’t help but be struck by the lack of “buzz” surrounding Microsoft’s Windows 8 tablets. Microsoft and its partners just introduced a slew of new hardware and software products, but the response at CES has been muted, at best. In fact, it seems to me that the start of 2013 has been very negative for the technology giant from Redmond.

– Apple’s falling stock prices have been getting all the attention, but while Apple’s stock ended the year up 30%, Microsoft only had a year long gain of 2%.

– Sales of Windows 8 tablets have been tepid, at best.

According to NPD, overall Windows sales dropped 11% during the holidays.

– And next year isn’t looking any better with Sterne Agee analyst, Shaw Wu, projecting a 2% growth rate for the PC side of the industry.

– Windows 8 tablets have been criticized as being “confusing” both by analysts and some of Microsoft’s manufacturing partners.

– Windows Phone – which was already struggling — has an industry low 37% repurchase rate. (EDIT: This low number may be a reflection of discontinued Windows Phone 7 devices.)

– Microsoft even had to suffer the indignity of having thieves break into one of their offices and only steal Apple products — ‘No Microsoft products were reported stolen

“Redmond, We Have A Problem”

Here’s Microsoft’s real problem: They shot their bolt with Windows 8 and they badly missed the mark. They looked at the wildly successful Apple iPad and decided that it was a flawed product. Instead of creating a tablet, Microsoft created a hybrid with the basic assumption that what the market really wanted was a tablet that could act as a notebook PC. It’s still early, but so far the marketplace is telling Microsoft that they got it wrong.

“Microsoft doesn’t have a credible response” to expensive tablets like the iPad, or cheap tablets like the Kindle Fire, Google Nexus, or iPad Mini, and that’s what’s hurting Windows consumer sales.” ~ Shaw Wu

While Microsoft Fiddles, Their Monopoly Burns

Nero was famed for fiddling while Rome burned. And like Nero, while Microsoft fiddles with hybrids, their business monopoly is burning. Businesses aren’t waiting around for Microsoft to get their mobile act together. They’re moving on and they’re moving away from Windows.

Trip Chowdhry, a managing director at Global Equities Research, has put out a research note estimating that Apple sold between 3 million and 4 million iPhones to businesses over the past quarter.

– In a recent analyst survey, the percentage of CIOs who said they’d conduct “broad” tablet rollouts jumped to 15 percent for this year from just 4 percent last year.

– Companies have also found they can save money by letting staffers use their own personal smartphones and tablets at work. Combine that with the corporate trend of avoiding new PC purchases and it paints a very bleak picture for Microsoft’s personal computing efforts.

Conclusion

“Apple’s iPad…now has a starting price of $329 with the entry-level iPad mini. … Windows 8 hardware priced between $500 and $1,200 is ‘uncompetitive’ compared to lower-priced options from Apple and even Google’s Android. ~ Sterne Agee analyst, Shaw Wu

In the fall of 2012, Microsoft planted the seeds for their future in personal computing. If the early signs are any indication, they may not be pleased with what they reap.

John Kirk

John R. Kirk is a recovering attorney. He has also worked as a financial advisor and a business coach. His love affair with computing started with his purchase of the original Mac in 1985. His primary interest is the field of personal computing (which includes phones, tablets, notebooks and desktops) and his primary focus is on long-term business strategies: What makes a company unique; How do those unique qualities aid or inhibit the success of the company; and why don’t (or can’t) other companies adopt the successful attributes of their competitors?
  • Defendor

    MS is saying it is right in line with Windows 7, with 60 Millions licenses sold:

    http://allthingsd.com/20130108/windows-8-tallies-60m-licenses-on-par-with-windows-7-rollout/

    But I’ll bet a hefty chunk are sitting at OEMs, since usage numbers show an uptake more like Vista than Win7.

    http://www.computerworld.com/s/article/9235059/Windows_8_s_uptake_falls_behind_Vista_s_pace

    It is hard to ever quantify these things with vested interests choosing different ways to report the numbers.

    All I know, is that after trying out Win8, I think it is a mess. It may be enough to push me over the edge to a Mac on my next “PC”, unless MS Fixes it before then.

    • FalKirk

      “MS is saying it is right in line with Windows 7, with 60 Millions licenses sold…”

      Microsoft will sell an awful lot of licenses and they’re in no danger or running out of money. But if they don’t sell Windows 8 tablets and Windows 8 phones, they’re going to be shut out of mobile computing which is the same as saying that they’ll be shut out of the future of computing.

      • terry

        When is the future of computing

        • FalKirk

          If we’re talking about mobile, the future is now. If we’re talking about tablets…the future is still now. :)

  • Rich

    As Steve Wildstrom has pointed out, Microsoft is strong in the enterprise with products such as Office, Server, and CRM Online and I don’t doubt that MS will maintain dominance in that market indefinitely. But Windows 8 was conceived with tangled-up thinking and I still believe that unless they’re buying new computers, businesses will reject it, and the home market will say “Pass.”

    • steven75

      I don’t know about using the word “indefinitely.” Nothing is infallible, including Microsoft’s business monopoly.

      • Rich

        Check the dictionary…indefinitely doesn’t mean forever – it only means the length of time is unknown.

  • no

    Did you know that NOVA (British TV probably produced it) did an episode
    on who burned Rome.
    It was concluded that Christians who had a prophecy to match.
    did it and blamed Nero.

    So you need to come with different analogy
    since you don’t want blame the christians.

    talk about myth making, I thought only savages had myths
    and you guys had real history.

    • FalKirk

      When the legend conflicts with reality, you print the legend. :)

      • pawhite524

        Rare to see a reference from “The Man Who Shot Liberty Valance.” Nicely done. I know what is going to be in the DVD player tonight…

        • FalKirk

          Ha! I wasn’t sure if anyone would catch that reference. Well done.

    • pawhite524

      Regardless of who set the fire the analogy of Nero fiddled while Rome burned has to do with Nero’s lack of response to the situation at hand. (It also points to Nero’s madness and other analogies have sprung from this saying), I have never heard of laying blame on how the fire started when this analogy/metaphor has been used.

  • http://search.websonar.com:8080/ Duane Bemister

    In all likelihood Apple will release an updated iPad mini in the Spring at the current price and drop the current version to under $300.00. At that price many people would buy a new one every year. I would say the tipping point is imminent.

  • Matang_Lawin

    Hi John Kirk, How are you? First off id like to say happy new year mate. It’s been a while since last I checked Techpinions. I know you have covered alot of ground re Androids, Google, MS, and what nots but moving forward can you write a piece/part series why Apple is floundering at the moment? Surely if you turn your energies, you can deduce why: 1. Its Stock keep falling, supplier procurements cut, and market demand slowing down. 2. Is Tim Cook doing something wrong? 3. Why is Apple losing the smartphones war with Samsung (with re to no. units sold) 4. Has Apple already reached its peak with the Iphone 5 and its mishap? 6. Finally what Apple needs to address to remediate on this issues? I’ d be hats off to you if you turn your energies on that. Who knows Tim Cook may pick a gem of thought or two, from your Apple piece/part specials. Till then I’ll be waiting… Ciao.

    • jfutral

      “deduce why: 1. Its Stock keep falling”

      Right? AAPL pricing is normally so bullet proof against things like rumours, speculation, and innuendo. It is more often governed primarily by rational analysis, sound financials, and the steady hands of investors. What could Apple be doing to itself to be driving it stock price down? What, oh, what? This is just not typical. Obviously Cook is mucking things up.

      Joe