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Windows 8 is the next Windows ME? The sales numbers suggest that accusation is malarkey

Windows 8 was an incredibly bold redesign on the part on Microsoft Corp. (MSFT).  The move to a more touch-friendlygraphically rich operating system certainly seemed to mirror the general direction of the device market, but that did not shield Microsoft from loads of criticism. Many wondered whether it went too far with the graphical gloss, whether it was disrespecting developers with its shift to a walled-garden "Windows Store" app distribution model, and whether it was forsaking traditional desktop power users.

I. Windows 8 Upgrade Sales: Very Strong

But the proof is in the sales, and Microsoft announced today that for all the haters, Windows 8 appears to be doing great.

In its first month of sales Windows 8 has moved 40 million licenses, according to Microsoft.  The company announced the news in a blog post and at a conference presentation.  It also points out that buoyed by reduced upgrade fees, the Windows 8 upgrade rate is outpacing that of Windows 7, the previous sales record-holder.

Indeed, our own polling shows that the majority of users are upgrading to Windows 8, although there are certainly many holdouts bitter about the changes.

Windows 8 boxes
While some upgrades have been via disc, the new OS has largely been digitially distributed.
[Image Source: The Verge]

Windows 8 is the first Microsoft OS to transition to a primarily online distribution.  That shift has not seemed to adversely impact sales.  It appears Microsoft timed its transition to disc-less media correctly.

II. The Road Ahead

Microsoft's Brandon LeBlanc also brags that its Windows Store is thriving, writing:

There were more apps in the Windows Store at launch than any other app store at their launch and since then, the number of apps in the Windows Store has doubled. A number of apps in the Windows Store have crossed the $25,000 revenue mark and the developer keeps 80% of the revenue they make off downloads for the life of their app. A lot of great new apps have been added to the Windows Store since launch such as CBS, ABC News, ABC Family, Engadget, Flixster, OWN (Oprah Winfrey Network), Vimeo and my (current) personal favorite - Top Gear.

A strong app market is good news for Microsoft.  While it offers a more favorable revenue split than other players like Apple, Inc. (AAPL) or Google Inc. (GOOG) (with developers keeping 80 percent of the revenue), Microsoft still is closing the loop to include itself in Windows software sales profits.

In the past, Windows Certification processes offered up small cuts to Microsoft, but software publishers largely pocketed these profits.  Now Microsoft has cut out the middle man by playing super-publisher with Windows 8, the same move Google and Apple have made with their mobile and personal computer platforms (although Google does allow unofficial third party channels).

Ballmer Slate
Microsoft needed a bold reinvention in the mobile direction to keep up with market trends.
[Image Source: Bloomberg]

Looking ahead, Microsoft has a lot of unanswered questions -- most notably on the leadership front.  Windows 8 was the baby of departed Windows President Steven Sinofsky.  His shoes are currently being filled by former CFO and CMO Tami Reller on the business/marketing front and by Internet Explorer, Office and Windows interface veteran Julie Larson-Green on the software/hardware development front.

And the deep divisions between those who love Windows 8 and those who hate it, could hint that sales may dip to a slower pace than Windows 7 after the fans have completed their upgrades.

But, given the already modest success, and given the life-or-death need for Microsoft to have a cohesive, touch-friendly mobile platform, it appears overall Microsoft made the right choice.  Windows 8 isn't perfect, certainly and as they say, haters are going to hate.  And that is certainly true of Windows 8.  But it's better to be hated for innovation than panned for lack thereof.

Source: Microsoft



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RE: .
By yale_s on 11/28/2012 2:07:12 PM , Rating: 3
messele wrote:
quote:
in a recession that is deeper than it was 3 years ago when Win7 came out and Win7

I don't understand what you mean. October 2009 when win 7 was released was at the bottom of the Bush Recession - after 5 quarters of negative GDP growth and at 10% unemployment. Win 8 was released during an expansion after 13 quarters of GDP growth and at 7.9% unemployment.


RE: .
By messele on 11/28/2012 2:46:06 PM , Rating: 2
Yeah. Welcome to America.

Two things.

Firstly, believe it or not. Win7 and 8 were for sale outside of the US.

Secondly, growth alone does not give an accurate snapshot of the economy. Are you saying that finances are in as good order today as they were mid 2009? There was a big global descent in between and only a small sign of recovery, much of which was smoke and mirrors to suit political agendas (again, globally).


RE: .
By 91TTZ on 11/28/2012 9:55:08 PM , Rating: 2
Keep the idiotic politics out of this. This wasn't a "Bush recession". It was a recession in the US that was part of a larger, global recession. Every country was full of idiots who thought that the recession was the fault of their current leader.

You had idiots blaming Bush for it, now you have idiots blaming Obama for it. The fact is that the recession was happening in the outside world, too.


RE: .
By Argon18 on 11/30/2012 5:27:36 PM , Rating: 1
Who is feeding you your "facts" about the economy? Your numbers are wrong. Besides, if you want a prime example of economic policy failure, miserable miserable failure, look no further than the boy-king Obama.


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