18 May 2012

Analysts Expect Windows 8 to Disappoint



Well, this happened sooner than expected. Analysts have downgraded price targets on HP & Dell, and expect Windows 8 to disappoint.

I've been saying this for a while now. Windows 8 has numerous problems, from product & segmentation strategy to marketing. I have previously called out HP & Dell for putting all their eggs in the Windows 8 basket as well, while rival PC/tablet makers have hedged their bets on operating systems.

With Windows 8 devices are slated for an October launch, we should see how this turns out soon enough. My prediction is that the Windows 8 launch will cause more harm than good to the PC market.

16 comments:

  1. Windows is like Facebook, every change is met with complaints.I haven't followed closely, but see Metro does not look like a good fit for a desktop computer. It will be interesting to see how this plays out.

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  2. sameer_singh1718 May 2012 at 13:40

    That's right, change is always resisted, but Windows 8 has bigger problems than that. You're also right in the sense that Metro is a better fit for touchscreens and that is exactly why Microsoft has been pushing OEMs to add touchscreen panels to the upcoming ultrabooks. The problem is the BOM is being pushed so high that pricing is untenable.

    And this is happening at a time when consumer PC sales are already languishing because of tablets.

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  3. If they want succeed with Windows 8 they will need to keep the price low on the tablet side because no Average Joe will spend that 700-800 on a tablet when there are so many Apple/Android choices for much less. 

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  4. Windows 8 will sell fine due to OEM bundling, but nobody will use Metro on it.  And so far I haven't seen a single thing that compels me to upgrade from Windows 7, which is running perfectly.  Its XP -> Vista all over again.  Metro UI looks horrible, like the kind of interface you'd see on Tickle Me Elmo learn to spell for ages 5 and up.

    And Windows Phone 7 will continue to be a flop too.  Only thing Microsoft's really been getting right in terms of market domination is Xbox360 but thats mostly just because Sony has been doing everything wrong. 

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  5. sameer_singh1719 May 2012 at 06:05

    I don't think OEM bundling will help this time. PC sales growth has already been hit hard because tablets have more or less stalled the PC replacement cycle. Now, when most people who're on the fence about a tablet (and there's a lot of them) see Metro, they're going to make the switch.

    And I don't think using the desktop exclusively is an option on windows 8. You can't boot into it and without the start button, there's a lot missing.

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  6. matthewmaurice19 May 2012 at 23:57

    I wouldn't put too much stock in this. The original ZD post references at Keith Bachman at Bank of Montreal. I'm sure he's a nice enough guy, but he ain't great at predicting the future. He finished 44th out of 57 on Apple's last quarterly results (http://tech.fortune.cnn.com/2012/04/25/apple-q2-misses-high-and-low-but-the-best-bloggers-nailed-it/), so I'd take his predictions with a grain of salt. Although he does now have Apple set to "outperform", great bit of guesswork there.

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  7. sameer_singh1720 May 2012 at 09:23

    There's a reason every single Banking Analyst has always been wrong about Apple results. Non-independent nalysts are bound by the "house view" and they can't stray too far from it. House views are normally based on company guidance. And Apple's guidance has historically been very conservative.

    Apple's stock isn't impacted by the guidance because they annouce it in tandem with their results. And since Apple results are always well above the previous guidance, the stock goes up.

    Apple is just a master of media/PR manipulation and that really has no bearing on the capability of analysts.

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  8. I assume Microsoft is thinking it can make up the difference in PC sales with tablet sales. They have a number of hurdles to get over for this to happen, but it is not impossible. Android or ios tablets cannot replace PC's for most people.

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  9. sameer_singh1721 May 2012 at 17:09

    That's the thing. Tablets don't need to replace PC sales to put a dent in Windows financial performance. All they need to do for now is extend the PC replacement cycle. Consumers just hang on to the older PCs for longer.

    And Windows tablets won't really solve the issue either. Because x86 tablets will be too expensive with non-touch optimized programs, while ARM tablets won't have any legacy application support. 

    When you look at it critically, there is no real reason for anyone to buy a new x86 WIndows 8 PC or tablet unless their existing PC is completely unusable. The problem is no version of Windows 8 really addresses a market need.

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  10. No one really needs an ipad and yet Apple has sold millions.

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  11. Correct, but that's Apple's primary strength isn't it? Marketing. The marketing strategy for windows 8 has already been a disaster. They haven't even been able to hold the attention of the Microsoft faithful with the consumer preview.

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  12. Nathan Thirlby18 June 2012 at 09:54

    I'm not sure how you can say the marketing is a disaster when the marketing hasn't even started?

    In fact i'm thinking there hasn't been any marketing. Just previews for developers to get used to the idea of Metro.

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  13. sameer_singh1718 June 2012 at 09:56

    Not sure if serious. A company's marketing/communications strategy starts when the company first announces a product. You might want to read the article I linked in the post.

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  14. There isn't anything missing... for desktop users the metro interface is a glorified start button... and you may set it up as such if you want. 

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  15. Do you even use Windows 8 RC? I use it every day as my main OS... it's got it's share of RC style bugs, but it's more stable then the Win7 RC and the Metro UI combined with a desktop leads to all kind of useful ways to use both at the same time especially with duel monitors.

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  16. sameer_singh1723 June 2012 at 05:53

    I'm assuming you haven't read the article I linked above in the post.  The problems with Windows 8 are primarilyrelated to Microsoft's product segmentation and targetingstrategy.

    And yes, I have used Windows RC. It is the most schizophreniz OS I have ever used. The performance is excellent, but the experience, not so much.

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