Editorial: Why Windows 8 Tablets Will Beat the Odds, be a Winner
December 1, 2011 8:05 PM
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Microsoft's fast failures in the mobile space have bred skepticism, but call me a believer in Windows 8
Microsoft Corp. (
) has had a rocky go in the tablet market. It
Apple, Inc. (
) to market with its
slick Courier "design book" dual-tablet
, but instead opted for a wait and see process that
cost it millions, if not billions in sales
. But I firmly believe that it will succeed in the tablet area, when it finally makes a serious entry next year.
Microsoft: A Brief History of Its Mobile Woes
First a brief history lesson on what has gone wrong when it comes to Microsoft and mobile...
Everything that could go wrong in the tablets market for Microsoft did go wrong. Intel Corp. (
failed to deliver on its ambitious promises
, leaving Microsoft without viable mobile CPUs. Meanwhile, Apple's tablet sales
grew much faster than anyone expected
, putting Microsoft far behind.
Meanwhile, since it gained a promising quarter of the fledgling smartphone market with its promising Windows Mobile operating system back in the 2004, it's been all downhill for Microsoft's mobile efforts. Windows Mobile pulled a Symbian and
overstayed its welcome
bleeding market share
; and the
most promising of all
, Windows Phone, has seen slow sales due to
poor marketing and partnership efforts
from Microsoft which sadly held back its surprisingly competitive OS from public visibility.
Tablets have been such a hit for Apple that some people are already referring to the next phase of computing as "the post-PC era"; a phrase that implies that Windows PCs will be relegated to secondary status while tablets and smartphones will reign triumphant. Such claims are of course premature and highly speculative, but they're
very damaging to Microsoft
in that they do have some shred of truth --
PC growth is slowing
at a time tablet growth is surging.
Tablet sales are expected to
hit 70 million
this year, while Gartner, Inc.'s (
) latest sales prediction is that they will "continue to experience strong growth through to the end of 2015 when sales are forecast to reach 326.3 million units."
Tablet sales indicate we're indeed on the verge of a "post-PC era". [Image Source: Bloomberg]
And according to an
, Gartner VP David Willis stated, "By 2016, more than 900 million tablets will be in the hands of users."
With total predicted PC shipments at 385 million for 2011, that means that tablets may be the most used type of big-screen computing device, exceeding sales of laptops and desktops. In other words, it's not the post-PC era yet, but top experts are convinced that users are headed in that direction.
But if it’s product or perish for Microsoft in this "post-PC" era we're entering, Microsoft is finally looking well prepared. With Windows 8, everything is about to change on the mobile front for Microsoft. You might not believe it, but Windows 8 tablets will be a hit. After trying to explain this distinction to one last Apple die-hard I decide to put this in article form.
Note, I include
reader to provide some extra perspective on why this platform is promising.
Why is Windows 8 a
game changer for the tablet market
? Here's why:
A peek at Metro UI from IDF 2011. [(c)
People have long wanted a Windows tablet, but reliance on Intel's sluggish mobile team has stunted that possibility. Now it's a level playing field, with Windows 8
fully ready for ARM
. And of course, support for Intel is still there as well, in case Intel finally catches up in the mobile sector with its
promising process technologies like 3D FINFET
An Important Note:
There's much talk about
incompatibility of x86 apps
on ARM Windows 8. There some truth to these reports, but to the casual reader they can be somewhat misleading. Microsoft has been relatively clear on this issue -- you won't just be able to pop in a disc and install an x86 app. You'll have to obtain a new copy.
Most users get the majority of their programs from the internet anyways when they buy a new PC or mobile device, so this isn't a big deal. It just puts pressure on Windows app makers to recompile their code to be ARM compatible.
ARM Windows 8 on laptops/tablets should use pretty much the same API interface, by definition as x86 Windows 8 on tablets/laptops/notebooks. While the API may change slightly for the tablet version, the take home message is that most of the key system calls will still work the same way in your source code.
Barring some very deep firmware level interface apps, you should be able to take your legacy code and recompile it for ARM. As ARM penetrates the laptop space, we should see a big effort by computer software makers to recompile their top products for ARM. This will in term be a boon to ARM tablets as they will also gain access to these recompiled programs.
The lone area where this could be a hinderance is with paid apps. While much of the apps we enjoy today in Windows (e.g. Chrome, DivX, FoxIt Reader, uTorrent, PeaZip, Notepad++, Open Office, etc.) are completely free, others (e.g. Photoshop, Microsoft Office) are not. This situation is particularly true when it comes to PC games.
Of course paid apps will likely compile at least much of their offerings for ARM, but it remains to be seen whether they offer courtesy replacements to users' discs, or some sort of discount program for those who legally purchased x86 software and now want to make the switch.
So the biggest unknown is whether people will have to "repay" for paid apps. Is this a dealbreaker? Not really, considering you'd have to "repay" in iOS or Android too. And it's an issue that doesn't really apply to freeware, which comprises much of what makes Windows great.
A different opinion from a reader "Da W", who agrees with me on Windows 8 tablets selling well, but disagrees about the CPU:
I'm not sure ARM will catch on. By 2012 we will have ultra low power Ivy Bridge that will certainly fit a tablet power envelope and it seems Dual-core @ 2GHZ bobcat with Radeon 7000 series GPU on AMD side, that should trounce tegra 3 GPU power. Intel's offering will certainly be pricier, but having x86 compatibility to run you countless legacy utilities is an undeniable advantage. Plus any new app, including the 40000+ windows phone 7 apps ported to WinRT, should run on both ARM and x86.
So except if having a razor-thin tablet is really important, i don't think ARM will dominate the Windows 8 tablet market.
Google Inc. (
) allows its hardware partners a wide variety of free reign in terms of capabilities. This allows them lots of flexibility and greater consumer selection, but can
hurt them in fragmentation
. Apple, on the other hand, has practiced a one-smartphone/one-tablet approach to market, which allows for consistent hardware and greater optimizations.
If Windows Phone and early reports
are any clue
, Microsoft will follow the middle path compared to its rivals' extremes. It offers hardware partners a small amount of component flexibility but a large amount of flexibility in packaging, form factor, and buttons/ports. This approach may not initially appear superior, but ultimately it seems an enlightened mobile approach.
One reason WHY people wanted a Win tablet was because they're used to the Windows operating system. The market may be shifting towards Unix-like operating systems, specifically OS X (BSD-derived) and Android (Linux), but overall people still use Windows PCs more than other operating system. There are over a 1 billion Windows PCs -- almost everyone knows the basics of how to use Windows no matter how much of a mobile enthusiast they are.
Remember too, that while Microsoft has failed in the mobile sector, in terms of consumer electronics, Windows laptops are today the world's most used personal computing products of any kind (laptops
now outsell desktops
). In that sense Microsoft is the world's biggest mobile operating system maker. While prior to Windows 8, its mobile OS was the same as vanilla desktop Windows, it's the focus on quality mobile performance that is a major part of why Windows 7 received such a warm reception and
set sales records
So Microsoft knows what it's doing in terms of PC mobile operating systems, even if porting it to a tablet is a new experience.
Like Android, Windows 8 tablets should
undercut Apple in price
, while offering high level performance. This is the advantage of a third party OEM approach. Apple fans often point to the fact that design is outsourced then to Asian firms that they deride as "knockoffs" as a point of criticism for top-selling Android tablets.
There may be some truth in this, but even mighty Apple recruits Asian firms for the majority of its design. Companies like Samsung and Foxconn have as much to do with the iPad's hardware as Apple does. So don't expect the fact that a Windows 8 tablet comes from Taiwanese or South Korean firms to necessarily equate to an inferior to design to Apple's -- Apple's tablets are coming from the same place. Of course American firms like Hewlett-Packard Comp. (
) and Dell, Inc. (
) will likely put out Windows 8 designs to, which like Apple will have a heavy Asian design influence.
Windows Phone has been
a market failure
thus far, but its allowed Microsoft to learn how to make a fast, fluid experience on a mobile device. WP7 has been held back by the lack of carrier hard selling due to lackluster carrier pushes on Microsoft's behalf. Tablets are more of a direct-sale party electronics market, so they should be able to benefit from WP7's optimization, while not suffering the same sales issues it did.
While not explicitly stated, chips
like the Adreno 3xx
by Qualcomm, Inc. (
from NVIDIA Corp. (
) should allow for Xbox-quality graphics. Microsoft could have a better game library than the iPad in some ways, if it adopts an easy opt-in/auto-porting process for Xbox titles. Developers simply would dig up their sources, recompile for ARM, and use a minimal interface wrapper to translate any minor differences between Direct 3D Mobile 10 (the likely release graphics API for W8 tablets).
Microsoft hasn't mentioned this, but I do believe it could be Windows 8 tablets' secret weapon. As shown
with the Asus Transformer Prime
, wireless controllers and video could turn Windows 8 tablets into virtual Xboxes with full controller support and storage via SD slots.
A peek at Metro UI from IDF 2011. [(c)
Having played with
Windows 8 (a real living tablet)
I can say
the Metro UI
is looking SLICK. Having spent quality time with an iPad 2, I agree it beats Honeycomb in fluidity of animations. But Metro UI beats both and I think its look is very modern and Web 3.0. By contrast Apple's chiclet grid look is the same tired bag that's been around since Nokia Oyj.'s (
) early 2000s offerings, albeit with slicker animations and apps.
Having an iPad 2 or an Android on a corporate network is somewhat of a scary proposition given the fledgling state of IT administrative tools and the large flow of vulnerabilities. In iOS and Android, vulnerabilities arise for different reason. In iOS it is primarily due to Apple's
refusal to allow jailbreaking
in a controlled form. In Google's case, the publication of its source code definitely has an impact, allowing for a slightly easier path to
. This isn't a knock on open source software security -- the open support community has offered great progress on the security front.
With that said, no company has as much experience working with third-parties to allow powerful IT tools as Microsoft. Those tools should be portable to Windows 8 tablets. Further, no company has as much experience patching an ever-present onslaught of security flaws as Microsoft. It hasn't always been good at this, but necessity is the mother of invention, and constant warfare has
hardened Microsoft into a security lion
much like constant war hardened the Macedonians, Romans, and the Mongolian Horde of millennia past.
Further Microsoft again benefits from an in-the-middle approach. By allowing a fully customizable hardware interface (akin to jailbroken tablets) it can avoid enthusiasts unwittingly unleashing security holes in their quest for modification-allowing back-doors. But its code is closed so malicious developers will have harder work ahead to find flaws.
Let me conclude by saying I have no affiliation with Microsoft or ARM (who would benefit from the success of ARM Windows 8 tablets) and I do not hold eithers' stock. In fact, I rarely even interact with Microsoft on a PR basis. About all I can say is that I am a futurist who likes to examine market trends and hunt for the big picture. And I'd say the big picture -- how I see it at least -- looks extremely hopeful for Microsoft in the tablet sector.
We shall see if I'm right, but I know a number of readers have expressed similar opinions in my past pieces on Windows 8 and tablets in general. At least if I'm wrong, I'm in good company with some of my loyal readers.
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Microsoft's Innovators Dilemma
12/2/2011 7:25:20 AM
I am not convinced that Windows 8 tablets will be a success in terms of numbers sold - but time will tell.
What is interesting about Windows 8 on tablets is that for the first time Microsoft is going to have to embrace the disruption of it's beloved Windows-Office business.
Microsoft does not make PCs and will almost certainly not make tablets. It makes all it's money from software licences (the X-box hardware business barely makes any profit). In the PC world Microsoft has established, and superbly defended, a model based on high prices for software, and a system where by all major upgrades to the OS are paid for as are every major iteration of Office.
The tablet ecosystem pioneered by Apple, and which all other tablets makers and ecosystems look like being forced to copy, is not like that. In the tablet system software is cheap and OS upgrades are free. Apple only breaks even on it's App store operation, and on the iTunes system in general, whilst allowing developers to make significant amounts of money (several £billion so far). Apple created the iTunes system to create a value stack for it's devices.
One can already see the dilemma for Microsoft when faced with the option of releasing the rumoured iOS version of Office. They could choose not to release an iOS version but as there are Office compatible apps on the iOS already that means ceding a rapidly growing iPad market to it's competitors and undermining the 'Office everywhere, Office as a standard' strategy. So Microsoft might decide to release a version of Office for iOS but then how to price it? In order to sell against the competition and compete under the existing iOS app market price norms it may have to offer Office for a low price, around the $10-$15 range. That's a big hit to it's traditional model of a revenue stream. And if they do that then how could they charge a lot more for the Windows 8 tablet version?
This present a true Innovators Dilemma for Microsoft.
Leaving aside the iOS version what about software prices and upgrade models on Windows Tablet 8? Can Microsoft charge £50 or $100 for office on a Windows 8 tablet and sell in quantity? Wouldn't that invite someone else (Apple if they wanted to be devilish) to sell something as good for Windows 8 tablets for £10? Maybe Microsoft will offer a desktop-tablet bundle of Office in it's usual high price range but that would not be attractive to customers who just want a tablet version and it still leaves the market open for a low cost tablet only alternative from someone else.
What about tablet OS upgrades. This is an absolutely critical element to Microsoft's revenue flows. Can Microsoft charge for system upgrades to Windows 8 tablets when Apple and Android don't?
I thought at the time that when Apple announced the really low prices for iWork, Garage Band, iMovie etc on iOS that it was a fantastically clever move. In a stroke it cut the ground from under the high price software market by establishing a new model. Once iOS devices were selling in significant quantities (250 million iOS devices sold is a conservative estimate for 2012) then this new low price model becomes a big threat to companies whose business model is based on high software prices. Look at the prices Adobe charges for it's iOS apps. Look at an iOS app like Snapseed from Nik software (a great photo editing tool by the way) which costs under $5 compared to say Nik's Viveza Photoshop plugin which costs $99. You can see the way the wind is blowing on app pricing.
So Microsoft's dilemma is that the more successful Windows 8 tablets are the more it establishes a competing model to its current main revenue pillars and if Microsoft tries to limit or cripple the cheap app price system on Windows 8 tablets it may end up ceding tablets to Apple and Android (mostly Apple).
Watching how Microsoft tried to navigate this will fascinating.
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