Tech focus now on Microsoft Windows 8, Surface tablet

SEATTLE — Firm sales numbers for Microsoft Corp’s Windows 8 and its new Surface tablet will not be available for three months, but it may be clear long before then if it has a hit on its hands.

“We can definitely gauge it by chatter,” said Emily Chan, an analyst at Bernstein Research. “There is a slight learning curve, so I don’t think we will see that big pop that iPad saw.”

Microsoft is desperate for the new-look, touch-friendly Windows 8 to grip customers’ imaginations, as it looks to regain ground lost to Apple Inc and Google Inc in mobile computing and shake up the moribund PC market.

Perhaps more important is its new own-brand tablet called the Surface, available only through its own stores and website, which will challenge Apple’s iPad head on.

“I’d want to know the sales – and return rate – of the Surface,” said Sarah Rotman Epps at tech research firm Forrester. “But those numbers will be hard to get since Microsoft is the only retailer.”

Early reviews of the Surface have been mixed, generally praising the slick hardware, but faulting battery life and the limited software and applications available.

Some worry that the first Surface model, which runs on a stripped-down version of Windows 8 called RT that is not compatible with old Windows programs, will cause some confusion and dissatisfaction among customers.

The three models for sale on Microsoft’s U.S. website are already on back order, suggesting strong demand, but it is not known how many Surfaces Microsoft has manufactured.

“The fact it’s back ordered is indicative that there’s consumer interest,” said Michael Gartenberg, an analyst at tech research firm Gartner. “How Microsoft introduces it, evangelizes it and explains it will determine long term success.”

Ballmer noise

Microsoft has not said if it will reveal sales figures for Windows 8 or of the Surface before its next scheduled earnings on January 24. The company tends to trumpet good news and stay silent otherwise.

After the launch of Windows 7 three years ago, CEO Steve Ballmer waited only a month to announce strong sales. A year later, he waited only 10 days to report record-breaking sales of the Kinect, the motion-sensing add-on for the Xbox. But Microsoft has never shared the sales of Windows-powered phones, which have a lowly 3 percent of the market.

If Ballmer stays silent about Windows 8 sales, it might indicate a less than stellar performance.

“I would definitely take it a sign that it’s not super, super strong, but I won’t take it as something negative,” said Chan at Bernstein, who is expecting 8.3 million Surface sales by the middle of next year.

That averages out at about 1 million a month, a third the rate of the iPad, which notched up its first million sales in 28 days and has now sold more than 100 million units, averaging about 3.2 million a month.

Gartner forecasts that Surface and other tablets running Windows RT will sell about 2.3 million units this year and 9.3 million next year, grabbing about 2 percent and 5 percent of the worldwide tablet market, respectively.

Door-busters

Retail activity will be closely watched. Microsoft will have more than 60 brick and mortar stores open for the release of Windows 8 on Friday, half of them ‘pop-up’ stores that will stay open for the holiday shopping season.

Third-party retailers are cautiously optimistic.

“We have seen pretty good response to our pre-orders for Windows 8,” said Best Buy Co Inc spokesman Jeff Haydock. “Quite honestly, I don’t know what to expect from Friday. I don’t know if there will be lines or not. My sense is it will take some time for people to kind of come into the stores and check it out.”

Best Buy may give some color on how PC sales are going when it reports earnings on November 20.

Wal-Mart Stores Inc, the No. 1 U.S. retailer, said U.S. pre-orders for Windows 8 PCs “have been better than expected.”

Online retailers Amazon.com Inc, Newegg Inc and TigerDirect Inc have been silent on Windows 8 pre-orders.

The full impact of PC sales on retailers will not be evident until chains report same-store sales for November.

Quick reaction

One early indicator of Windows 8′s success will be the contents of the online Windows Store. Microsoft has had a harder time drumming up interest among developers for Windows 8, given the risk that there will be fewer users than competing platforms.

Microsoft will not disclose numbers, but there are expected to be 5,000 or so third-party apps available to U.S. users, in comparison with the iPad’s 275,000. Some big names such as Facebook Inc will be missing.

In social media, the tenor of comments on the Twitter hashtags #Windows8 and #Surface will give an indication of their reception after Ballmer unveils them both on Thursday.

Many users likely will be shocked by the new design, which dispenses with the Start button and features square tiles for apps.

“Public reaction to the new UI will depend how well Microsoft explains why ‘different’ is better and teaches how the new experience works,” said Gartenberg. “That all starts on Thursday.”

By the numbers

The ultimate test for Windows 8 will be PC sales.

Industry trackers are expecting a bump for PC sales in the last two months of the year, but not enough to rescue the whole year, which is forecast to dip for the first time since 2001.

Some analysts had expected an uptick in production of laptops ahead of the Windows 8 launch, but PC makers facing an uncertain global economy have been wary about committing.

Chip maker Intel Corp, which is a good gauge of future PC demand due to its position early in the production process, expects the PC business to grow at only half the normal seasonal rate in the fourth quarter.

Chief Executive Paul Otellini recently told analysts he expects to have a better understanding of the success of Windows 8 in 90 days.

Stephen Baker, an analyst at retail research firm NPD Group, is expecting a 10 percent jump in PC sales for November and December over last year, but said comparisons will be difficult given a profusion of new devices and the volatility of year-ago data.

Fourth-quarter PC shipment numbers from research firms Gartner and IDC will not be published until early January, although analysts say PC makers might start to drop hints about demand before then.

“There will likely be many milestones, but very few will ultimately be decisive. The key point is will PC sales continue to shrink or will they experience a boost,” said Al Hilwa at research firm IDC. “We can probably begin to properly judge that with some ambiguity in January.”

source: interaksyon.com

Talk of Microsoft tablet resurfaces

SEATTLE — Microsoft Corp is gearing up to unveil its own tablet to boost its new Windows 8 operating system and counter Apple Inc’s hot-selling iPad, according to media reports on Friday.

Such an effort, which the company has not confirmed, would be a departure from its usual focus on software and potentially throw Microsoft into direct competition with its closest hardware partners such as Samsung Electronics Co Ltd and Hewlett-Packard Co.

The world’s largest software company has invited media to a “major” announcement in Los Angeles on Monday afternoon, but has not provided any details.

In the absence of information, talk is swirling that Microsoft will introduce its own tablet, according to anonymously sourced reports in the New York Times and the AllThingsD tech blog. Microsoft declined to comment on the subject and those reports.

It is not the first time such talk has surfaced, as Microsoft looks for a way to make an impact with its new tablet-friendly Windows 8 operating system and put the best product it can in the market to counter Apple’s iPad.

Apple, which makes both hardware and software for greater control over the performance of the final product, has revolutionized mobile markets with its smooth, seamless phones and tablets. Rival Google Inc may experiment with a similar approach after buying phone maker Motorola Mobility this year.

“Anything is possible if they don’t feel their partners are doing it right,” said Michael Silver, an analyst at tech research firm Gartner. “But it’s hard to compete with companies that sell your stuff and still have a great relationship with them.”

Other analysts suggested an own-branded tablet may be chiefly aimed at kick-starting the market for Windows tablets working on ARM Holdings Plc microprocessors – a new venture for Microsoft, which has traditionally relied on Intel Corp chips.

Microsoft charges hardware makers $50 or more to incorporate its software in machines and analysts suggest that hardware makers are struggling to produce tablets at a low enough price to challenge the iPad. By making its own tablets, Microsoft would presumably use its software for free, bringing down the overall price.

“It suggests to me that they’ve struggled to get OEMs on board to bring the prices down, so they feel they have to subsidize these products to get them out of the door, at least in the first iteration,” said Al Hilwa, an analyst at tech research firm IDC.

Making its own hardware for such an important product would be a departure for Microsoft, which based its success on licensing its software to other manufacturers, stressing the importance of “partners” and the Windows “ecosystem.”

When it has ventured into hardware, the Redmond, Washington-based company has a mixed record.

Apart from keyboards and mice, the Xbox game console was its first foray into major manufacturing. That is now a successful business, but only after billions of dollars of investment and overcoming problems with high rates of faulty units – a problem which was nicknamed the “red ring of death” by gamers.

The company’s Microsoft-branded Zune music player, a late rival to Apple’s iPod, was not a success and its unpopular Kin phone was taken off the market shortly after introduction.

Microsoft has tried hard to generate the type of excitement Apple gets for its secretive product launches, but usually disappoints. Talk was rife at the Consumer Electronics Show in 2010 that Microsoft would pre-empt Apple’s iPad with a slate of its own devising, but it never materialized.

The company killed off a two-screen, slate-style prototype called Courier later that year, saying the technology might emerge in another form later on.

source: interaksyon.com