Windows 8 - Playing With the Wrong Hand

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Microsoft is gambling its reputation with its upcoming operating system.

The PC is definitely not dead for Microsoft (and it won't be for a long, long time), but Windows 8 might hasten its decline.

On a tablet that properly supports Windows 8, the beta version of the operating system shows the careful thought that Microsoft put into its design. It supports more elaborate gestures than other tablet operating systems. There's also a cool sidebar feature that lets you work on two apps at the same time. Some of the apps that Microsoft is creating for Windows 8 are a little too simplistic for my taste, and the library of third-party Windows Phone 7/8 apps has a long way to go, but I'm impressed with the design of Windows 8 on tablets.

But with Windows 8, the medium is the message. Put the same Consumer Preview of Windows 8 on a desktop PC and the experience takes a step backward from Windows 7. It looks like the baby blocks of operating systems. Placing the Start button in a cloak of invisibility isn't a smart move. It shouldn't be difficult for Microsoft to display the Start button on desktops while not displaying it on tablets; I hope the company rectifies that before launch. Why relegate 17 years of common desktop user experience to the trash can? It's reminiscent of the Ribbon in Microsoft Office.

Will Windows 8 be successful on the desktop? Of course. People like to snicker about Windows Vista, but according to Net Applications, Vista has a larger market share (about 7%) than the combined share of the two most widely used versions of OS X, Lion and Snow Leopard. With the huge installed base and OEM support that Windows has, Microsoft prints money with every operating system release.

Even so, Microsoft is gambling its reputation with Windows 8. The question is whether consumers will be happy with it; enterprise buyers have little incentive to upgrade over the short run. Many are quite happy with Windows 7. Think of how long XP lasted.

That means that for the next couple of years, Windows will be a tablet operating system that secondarily targets consumer PCs. Microsoft is playing catch-up again, this time in mobile computing, but no technology company plays that game better. It also manages its platform with ISVs, IHVs, OEMs and customers better than any other tech company. Nonetheless, on the desktop, Windows 8 is going to be a leap of faith that many may not take.

Here's why that should matter to Microsoft. Tablets are selling like hotcakes, right? Yes, but when you compare the tablet market and the PC market, the latter is quite a bit larger. Forrester says that two-thirds of the smartphones, tablets and PCs used in business are running some form of Windows. The vast majority of those are PCs. Although Forrester expects that figure to drop to 50% by 2016 as iOS and Android continue to rise, Microsoft can't afford to abandon its huge installed base of Windows PCs in its zeal to play catch-up on mobile.

Plus, Windows 8 tablets have a steep road to climb. An IDC report predicts that Windows Phone will have a 20% share of smartphone shipments in 2016. The same report predicts that iOS will also have 20% of the shipments and that Android will have 47%.

So Microsoft is going all in with Windows 8 in a tablet market it can't dominate, while putting its cash-cow desktop operating system business at risk. That doesn't seem like a winning hand.

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