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Microsoft officially announces Windows 8.1, promises big improvements are coming

Even as Microsoft Corp.'s (MSFT) ambitious operating system redesign, Windows 8, hit the 100 million license mark there was a grim air of self-assessment amongst the company brass.  Windows unit co-head and former business/marketing chief Tami Reller acknowledged in the earnings call, "Is it perfect? No. Are there things we need to change? Absolutely. We are being very real about what needs to change and changing it as thoughtfully and quickly as we can."

I. Microsoft Admits Windows 8 is a Work in Progress

Microsoft for the first time directly confirmed in the announcement that those changes are being wrapped into Windows 8.1, codenamed "Windows Blue".  The new OS is expected to launch this fall, with OEM test builds already leaking.  The new OS is expected to restore some semblance of a "Start" button, as well as allowing users to opt to boot to the desktop.

Microsoft would not say when the new OS will launch saying only that it will be "available later this year".  Microsoft says more details will be announced in the next couple weeks.

Launching Oct. 26, Microsoft's Windows 8 has kept pace with Windows 7 in license shipments for the period (Windows 7 hit 100m on April 27, 2010), which do not necessarily reflect end unit sales.  However, sales are noticeably decelerating.  Windows 8 reached 60 million unit sales by January, faster than Windows 7.  But since it has only moved 40 million units.  By contrast, Windows 7 sales started off slower then rapidly escalated.

Windows Blue
Microsoft is currently working on Windows 8.1 [Image Source:]

The contrast stems largely from customer reaction.  With Windows 7, customers were wary from poor press and bad initial experiences to Vista, but quickly embraced the speedy overhaul of the familiar Windows interface once they experienced it.  Windows 8 appears to have had the opposite affect.  Customers started off optimistic off the high of Windows 7, but quickly chilled to the redesign due to its drastic and at times confusing nature.

Tami Reller
Tami Reller to Windows 8 users: "we're not sitting back." [Image Source: Microsoft News]

One big problem with Windows 8 is that despite the radical overhaul customers are presented with no basic tutorial on how to use the new OS when they turn it on for the first time.  Ms. Reller acknowledges that her company has perhaps over-innovated without giving customers a clear learning path commenting, "The learning curve is real, and we need to address it.  We're not sitting back and saying, they will get used to it.  We've considered a lot of different scenarios to help traditional PC users move forward as well as making usability that much better on all devices."

II. Lack of Affordable HD Laptops is Hurting Win8

A big problem is that while companies like Apple, Inc. (AAPL) or Samsung Electronics Comp., Ltd. (KSC:005930) have no problem producing $500 USD high-resolution tablets, computer makers seem clueless as to how to produce an affordable touch laptop, much less a high-resolution one.  Most touch laptops remain above $800 USD, while most 1080p or better laptops remain above $1,000 USD.  But the alternative is accepting a relatively crippled Windows 8 experience in non-touch form factors.
Acer Aspire P3
The Aspire R715.6-inch is among the >$800 USD Windows 8 laptops/hybrids.
The lack of affordable, high-quality, useable options has plunged PC sales by 14 percent in Q1 2013, the biggest drop in history according to the International Data Corp. (IDC).

Ms. Reller sounded hopeful on this note, commenting, "We know customers like touch laptops, but they are also price sensitive.  Our partners (hardware makers) have to bet on volume, so that they get price breaks, and get that moving into the (retail) channel."

III. Tablet Sales Poor, RT Tablet Sales are Worse Than Poor

Things did not go very well on the tablet front, either.  While Microsoft's Surface sales hit 900,000 unit in Q1 that pales in comparison to the 19.5m iPads sold by Apple or the 8.8m Galaxy tablets moved by Samsung.  Microsoft is reportedly working on a smaller, more affordable Surface, in line with Apple and Samsung's strategy.  

Ms. Reller tried to look on the positive side, commenting, "The launch of Pro has also been helpful for Surface overall."

Windows RT
Surface Pro helped cover nonexistent Surface RT sales. [Image Source: Microsoft]

Of course, as that comment hints at sales of Surface RT have tanked.  Windows RT tablet sales in general have taken an abysmal turn, moving only 200,000 units in Q1 2013, according to the IDC.  Ms. Reller defended Windows RT, arguing, "Our commitment to the ARM platform is very strong.  We've done, I think, a good job at really listening to our partner feedback on where they want to take the ARM platform.  We're listening, we're continuing to evolve, and I think you'll see that over the next several quarters from us … our continued agility on Windows RT and ARM."

Samsung, Dell, Inc. (DELL), Acer, Inc. (TPE:2353) and the Lenovo Group Ltd. (HKG:0992) have all attacked the embattled Windows RT, complaining about its lack of legacy compatibility and Microsoft's poor marketing of the platform.

Ms. Reller called ARM chipmakers Qualcomm, Inc. (QCOM) and NVIDIA Corp. (NVDA) "two great partners".  Qualcomm recently defended Microsoft's Windows RT, while NVIDIA refused to publicly give any comments of support (or criticism) regarding it.

Sources: Microsoft, IDC, The Verge

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RE: ...
By Motoman on 5/7/2013 1:08:38 PM , Rating: 2
If my only available options were to live with the Metrosexual UI, or switch to Mac - I'd switch to Mac. Given the choice though I'd switch to Linux before Mac.

The reality is though that people will just stay with their existing Win7/Vista/XP machines.

And of course there's apps to put the Start menu back into Win8 from 3rd party developers.

So not really any worry.

At the end of the day, Microsoft isn't really going to lose any marketshare per se - they're just not selling any Windows 8 licenses. They'll either get their act together and put the full, real Start menu and desktop back in, or people will continue to just not buy new computers and/or upgrade their OS.

Hope stocks of Win7 last a long time.

RE: ...
By Belard on 5/7/2013 2:14:51 PM , Rating: 2
Why not go Linux now? Try it out, especially on another computer... a spare computer. LinuxMint is excellent.

RE: ...
By xti on 5/7/2013 2:21:08 PM , Rating: 1
there is always one of these in these thread.

RE: ...
By Mitch101 on 5/7/2013 2:23:35 PM , Rating: 2
I like Linux but if a user struggles with the start button issue of Windows 8 even with free items to put one back their head will explode with the learning curve of Linux.

RE: ...
By Belard on 5/8/2013 8:53:13 AM , Rating: 1
The point is, TIFKAM is not compatible with windows programs, TIFKAM is a stupid desktop GUI and desktop application environment, come on... Microsoft is wetting their panties about how great win8.1 will allow you to (get this) see not just 2 but 3 (THREE) metro apps at the same time!!!

Whooped de fracking doo!

LinuxMint is easy to use, it's NOT windows, but where things are, makes sense. It's built in program management makes it easy to search and download programs then install. I installed LinuxMint because of windows8!

As long as you don't need windows specific programs, Linux will do. Games don't matter anymore, MS and consoles helped kill PC gaming. I'm buying one more $160 gaming card this fall to last me the next 5-8 years in case I need it... The PS4 is already on our wish list for Christmas. F MS, I won't buy their damn Xbox shit.

Linux functions like a desktop OS should, so it's not that much of a learning curve. It has it's control panel, doesn't take much to figure out. I installed OpenOffice as I want to stick with that rather than libreoffice (gee what a mess Oracle created). My wife knows little about computers, she uses her android phone for her personal needs... But she has no problems using Linux as a desktop OS once I set it up for her. No complaints. It's what she uses for work.

RE: ...
By Motoman on 5/7/2013 2:36:46 PM , Rating: 2
Because it's a buttload of work with a lot of BS to put up with when I don't actually have any problems using Win7.

Win7 is perfect for me. As was Vista, and XP.

I have no OS I'm not going to go and try to fix them.

RE: ...
By Motoman on 5/7/2013 2:38:41 PM , Rating: 2
...and also, I have to use MS Office and other MS tools for work, along with VPN utilities and whatnot that don't all have Linux versions.

And no...WINE isn't fine.

Not worth the effort. Best case is to use Win7.

RE: ...
By Pirks on 5/7/2013 5:00:22 PM , Rating: 1
your whining is funny, as if MS forces you to use metro apps. you can use desktop in win8 and forget about metro. so check your head maybe?

RE: ...
By Belard on 5/8/2013 9:09:30 AM , Rating: 2
Sick with win7.... Install Teracopy and Better Explorer... Enjoy it. I'll be using windows 7 as long as I need to. But I'm migrating to Linux.
Ive been using windows since the 3.1 days ( what a POS, always was) stardock made win3.1 usable with their stardock. Win95 was actually usable since it was an actual OS with some form of modern functionality.

So with almost 20 years of windows, I can't just jump over to Linux overnight. I have games and windows programs I still use today. But in a year or so, I don't see why Linux can't be my main OS.

The world today with computers is not like it was 3 or 5 years ago. I'm typing is on my iPad. I make posts on this site from my android phone sometimes. What do I need windows for? Turbotax, a few old PC games and photoshop. That's it. GIMP is no photoshop, but it looks like it'll do most of my needs. I still use MSOffice 2003... Open office is about 70% as good... I like MSOffice 2010... It's just that I don't need it personally. But in the end, I can get by with OO... But if I can get MSOffice 2003 to work under WINE and some other programs... That will help me move off of windows that much faster.

Printer drivers is biggest unknown to me... I'll need to research with brand works best with Linux.

The only direction MS will go is down. Meanwhile android, chromeOS and Linux are growing markets.

The world NO LONGER needs Microsoft, and that is WHY we have this turd called windows8.

"There's no chance that the iPhone is going to get any significant market share. No chance." -- Microsoft CEO Steve Ballmer

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