Last week in my Friday column I outlined a few of the challenges that I think Microsoft has in front of them with Windows 8. I cited lack of Windows momentum in the market along with changing software and app economics that are going to challenge Microsoft in ways they have never had to deal with. That being said I am rooting for Microsoft on this one as I have followed every major release since Windows 95. Although, I am not sure I have ever analyzed a release where I personally have had so much uncertainty about its chance of success.
Why I am Excited About Windows 8
Before I hit the larger direction behind this column, I want to make a few points about why I am excited and optimistic. What has me excited about Windows 8 is the kind of hardware innovation we are going to see because of it. Intel is helping this hardware innovation around Windows 8 with their UltraBook initiative and many of the products that will hit the market later this year and next are very interesting. Tim wrote earlier in the week about a category we are looking at heavily called “hybrids” which are tablet first hardware designs paired with a keyboard for when a consumer may need or want it. This is just one of many hardware designs that I think are very interesting and I am anxious to see how the market responds to them.
We write frequently about how the technology industry moves in cycles where a clear and obvious value shift moves from hardware, software and then to services. This example is clear in Apple’s ecosystem where hardware remains relatively constant and the major value has moved to software and now creeping into services.
Windows 8 because it is new and blends two unique experiences together will ignite a short term value trend where we will see new and innovative hardware built around the operating system. Inevitably, however, many of the designs we will see in hardware may not stick and the market will dictate which Windows 8 form factors are the winner. Because of the speed of this market and how mature the Apple and to a degree Android ecosystems are Microsoft–and partners– can not simply rely on the hardware and Windows brand alone to give them momentum in this market. Rather, for Microsoft to have a shot when they launch they need to get their apps together.
More than Hardware
To my point above of how the value chain evolves, it is as if, for Microsoft with this release, they need to come to market with as mature an ecosystem as Apple and Google in terms of apps and a software developer community. This, in my mind, is one of the most important factors necessary to truly evaluate and form an opinion of how successful the Windows 8 launch may be.
Microsoft needs to learn from Google on this one as the utter failure of Android tablets to gain any real traction is due to the lackluster apps built for tablets. Microsoft is in a similar position with Windows 8 Metro Apps. Of course Microsoft has legacy apps to fall back on but I still question how valid that really is in pure consumer markets.
My Techpinions colleagues Steve Wildstrom and Patrick Moorhead have already covered some of the potential legacy hardware issues with Windows 8 and perhaps some of the challenges Windows 8 faces on non-touch notebooks or desktops–which will still be a healthy portion of the market. I agree with and share their concerns in those areas but I am mostly concerned about what new and exciting software that will be waiting for consumers when they purchase these new Windows 8 devices.
To use a video gaming industry analogy, Microsoft needs a title franchise to drive the hardware. They had this with XBOX and Halo where many consumers bought the XBOX simply for this title– it was that valuable. There has to be something that grabs consumers attention and appeals to them in a way that no other platform can.
This is clearly one of the strengths of Apple as they continually put products on the market both in hardware and software that drive demand. Microsoft and others lag in this category and it needs to change fast or they will face and even tougher uphill challenge than they already do.
As I stated earlier, we are rooting for Microsoft. We need healthy competition in this industry. However, our expertise in being industry and market analysts gives us insights into the challenging road ahead. To be fair, this is one of the riskiest things Microsoft has done in a while. Taking risks can bring great reward or fail miserably. Let’s just hope Windows 8 is more like the Windows 95 launch in terms of success and less like Vista, or even worse, Bob.