It’s unheard of but, yes it’s true, Microsoft has made its first quarterly loss in its history. To be fair, Microsoft has taken a $6.2 billion write off because its 2007 purchase of online ad service aQuantive hasn’t yielded the returns envisioned at that time but what is disturbing is that revenue for Windows has actually fallen by 6%; not good news for Microsoft shareholders.
Modest growth in revenues for the Office suite of products is the only good news that Steve Ballmer has had lately. So the million dollar question is: will Windows 8 save the day?
Windows 8, due for release in October, has been designed for use on PCs laptops, tablets and home theatre PCs, clearly with the purpose of providing a common look and feel across all device types. Now that is quite an ambitious proposition and if it comes off will certainly have a dramatic impact in the market, but will it pay off?
l guess the jury will be out on this one for a some time to come, but I for one won’t be expecting to see any real fireworks on that front, and here’s why.
Is there a need for Windows 8 on the desktop? As I mentioned in my previous blog the rise of tablets has reduced the relevance of operating systems, it’s all about what you can do when and where you want. In the current economic climate, in a market that appears to have reached saturation, what benefit will an organisation gain by upgrading from Windows 7 to 8?
As an employee of a technology vendor, I understand the importance of new versions of a product to extend the promise made to users choosing a platform, but surely there does need to be some value creation in that process, no?
With a new interface: Microsoft has completely redesigned the interface and to navigate around it requires a whole new learning curve. One of the benefits Windows has had is the ease with which we have been able to adapt to new versions with virtually no disruption to productivity.
Metro has been obviously been introduced with the mobile market in mind, to remove the need for different interfaces across the spectrum of devices that we all now use. However, all the early reports I have read are not overly flattering, “lots of pain for little gain”, it is completely different from previous version, without even the familiar start button users are confused before they even get going.
Not to mention that for any Independent Software Vendor the need to ditch Win32 API and adopt the new WinRT API (and yes I hear you all saying that the runtime libraries are built upon Win32 API) but still .Net framework is a thing of the past, yes you can emulate it under Windows 8 and no doubt Microsoft will support if for some time now, but in reality we all need to start conversion projects now to be able to benefit from Windows 8, Metro and all the latest “cool” stuff.
Is this what the tablet market needs? You don’t have to be a genius to recognise that Microsoft is way to late in the tablet market and has just woken up. Apple understood what we want, saw the gap and produced a killer product, Android providing an alternative which is what free markets are all about, so is there room for another?
Then there is still the impact of the 7” iPad to come. Will features like app multi-tasking, the standard Windows file system and Office on the Surface be taken up by the Enterprise? I must say the ability to use Office on the desk top and tablet could be an advantage. We need do to ask the question though who has bought the iPad and the answer to that, in the main, is the consumer.
When it comes to smart phones, Microsoft’s track record in the smartphone business hasn’t really been covered in glory, even AT&T are having to invest big bucks in advertising to promote the Lumia 900 with little effect so far (iPhone and Android own more than 80% of the US market).
I’d imagine it really will be down to consumers as to whether Windows Phone 8 will make any impact, because as I have said before, the impact of the iPhone, iPad and the rise of social media have fundamentally changed the dynamics of how we now interact with information.
The consumerisation of IT has actually reversed the direction of technology absorption within the enterprise. Applications and products were often tested, modified and refined by ‘the deep pockets’ of large government funded projects prior to adoption by the enterprise.
It is the rapid rise of the consumerisation of IT, I believe, that has caught Microsoft by surprise. Having had an enterprise bias for many years, Microsoft has realised it has to shift its centre of gravity toward the consumer, and to do so quickly.
That winning the heart of the consumer has become of strategic importance is demonstrated in the emerging ‘Smart Home’ market. Fearing the impact of Apple TV, Google’s is racing to follow suite with its Nexus Q Entertainment hub and therefore it’s no surprise that Microsoft recently debuted its HomeOS system.
Will Windows 8 save the day for Microsoft? The answer is that is I don’t think that is Microsoft’s intention. It seems clear to me that Windows 8 is a tactical move by Microsoft to stop the bleeding. Having already been hit by one torpedo by Apple, Microsoft are trying to avoid getting hit by another. Its launch of the Surface tablet, plans for the smartphone market and coming Windows 8 are designed to stop the attrition and regain market share. Microsoft have woken up and are on the move….towards the consumer.