On Feb 29th, 2012, Microsoft officially unveiled its new operating system, Windows 8 at the World Mobile Congress in Spain (the Beta version is now available for download by end users). We feel that Windows 8 will lay the foundation for not just Microsoft’s survival in the mobile devices space but also help it grow in the face of intensifying competition from other operating systems (e.g. Apple’s iOS and Google’s Android).
The first thing to remember is that Windows 8 is not just a desktop or a notebook operating system and, given Microsoft’s dominance in the PC operating systems, the primary objective of Windows 8 would not be to defend its share on the PC market but rather to extend its reach to the ARM chips and various mobile devices.
The immediate demand for Windows 8 will come from the large proportion of Windows XP users who were so satisfied with that older OS that they never even bothered to upgrade their PCs to Windows 7, in spite of its substantial enhancements over Windows XP and Vista. Windows 8 further enhances the capabilities of previous versions of Windows, making it an attractive upgrade for PCs.
However, Microsoft is intensely focused on the mobile market and has designed Windows 8 to work with both x86 and ARM processors and has also designed it to work with a multitude of mobile devices, (e.g. notebooks, tablets, etc.), making it highly attractive to business users as well as consumers who want to access not just the Internet and various mobile apps available for Apple and Android but also their traditional PC-based apps
including, and especially productivity applications like Microsoft Office.
In the last few years, we have seen exponential growth in mobile devices (e.g. smartphones and tablets) based on Apple and Android.
There are essentially four key areas that will be critical for Microsoft’s success in mobile market: operating system, mobile devices, applications and service providers (carriers).
Mobile Operating System
After several years of lagging significantly behind other vendors, Microsoft’s Windows 8 is a significant improvement over its predecessor mobile operating systems. The current version will not give it the kind of dominance it has in the PC market. However, if it halts, or slows the rapid growth of Apple and Android devices, it would be a major success. Even as it releases the current version, we can be sure that the company is already planning new future versions with significant improvements that would help it grow its share vis-a-vis Apple and Android.
It is important to highlight a couple of differences between Microsoft Mobile and its key competitors. While Apple’s iOS is available only on Apple’s devices, Google goes to the opposite extreme and allows limited OS customization to device vendors to help them differentiate their products. While the device manufacturers may like this idea initially, this is likely to create tremendous variety in the market, causing much confusion for the app developers as well as customers. Microsoft, on the other hand, specifies the hardware requirements for its operating system and app developers and customers will know exactly what they get when they buy a Microsoft-based device.
One of the greatest requirements for success in the mobile space, and where Microsoft has an advantage is the ecosystem of OEMs, ISVs and other channel partners.
Apple and Android have had a head start in getting apps for their devices due to their early expansion. Their relative advantage in applications will diminish in the next 2-3 years very significantly.
The final key element that will determine Microsoft’s success are the service providers (or the wireless carriers). Many of the OEM vendors like Samsung and LG, who are likely to develop Microsoft-based mobile devices already have long-established relationships with carriers in local markets, making it easier for them to sell Windows-based devices to or through them. In addition, if the carriers see significant adoption among the end customers, they may not need much convincing at all.
Many customers have been waiting eagerly for the launch of Windows 8. Techaisle’s latest Ultrabook study (completed in January 2012), SMBs cite the availability of Windows 8 as the 2nd most desired feature which will spur the demand for new client devices.
Microsoft and Nokia were among the first ones to identify the mobile device market and Microsoft launched its first tablets nearly a decade back while Nokia launched its Communicator even earlier than that. While their vision was ahead of the market practicalities, they lost their focus when the requisite technologies and customer work styles did ripen up, allowing first Apple and then Android devices to grow rapidly. But given Microsoft’s vast and resourceful ecosystem, a few years from now, all past rumors of its death in the mobile space might seem premature. With the launch of Microsoft 8 and its strategic partnership with Nokia, it has taken first concrete steps to gain its rightful place in the mobile market.
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