Software // Operating Systems
04:55 PM
Connect Directly

Windows 8 Outlook: Murky At Best

Based on the latest numbers, Microsoft should slash prices on both Surface RT and Windows 8 to motivate sales, some analysts say.

Windows 8 lost some momentum in January but continued its slow expansion, according to the newest findings by Net Applications. The report, which also revealed that Windows 7 lost ground for the first time, adds new strokes to the increasingly murky picture surrounding Microsoft's newest OS. There's little doubt that Redmond's touch-driven flagship OS will amass significant market share, but whether it can approach its predecessors' dominance is far less certain.

Net Applications tracks usage data from 40,000 websites and 160 million unique visitors, meaning the statistics it collects aren't strict market share reports so much as reflections of user activity. Nevertheless, the numbers provide a snapshot into which platforms are gaining or losing steam.

Windows 7 led the pack in January with 44.48% of monitored activity, down slightly from 45.11% in December. Windows XP was second with 39.51% and Windows Vista, now in its twilight, was a distant third at 5.25%. Mac OS X 10.8 and Windows 8 rounded out the top five with 2.44% and 2.26%, respectively.

Overall, Windows platforms accounted for 91.5% of tracked traffic. The three most recent OS X releases aggregately achieved 6.4%, with Linux and other niche operating systems accounting for the remaining 2.1%.

[ Haven't made the Windows 8 upgrade yet? Too late to snag a bargain-basement price. Read Microsoft Jacks Up Windows 8 Upgrade Prices. ]

For Windows 8, the news is mixed. After launching in late October, the much-hyped Windows refresh snared 1.09% of activity in November before growing to 1.72% in December. With January continuing the uptick, the new OS is headed in the right direction. Then again, its November-to-December gains represent a 58% leap whereas its December to January progress represents advances of only 31.4%.

Month-to-month fluctuations in growth could easily be overstated, especially when the frame of reference is so small -- but given that the holidays were expected to deliver new devices and Windows 8 licenses to users' hands, the decline in momentum is disappointing.

Indeed, Windows 8's touch-centric OS was initially touted as the jumpstart flagging PC sales needed. That vision hasn't come to fruition. Windows 8 sold more than 60 million licenses in its first few months, a tally that roughly equaled the Windows 7 start, but overall PC shipments have continued to slide, making it unclear how many of the new Windows installations ended up on modern, touch-equipped hardware.

Due to recent price hikes, Windows 8's fortunes will likely remain tethered to hardware sale narratives. Microsoft placed the new OS competitively at launch; Windows 8 Pro was only $39.99 and could be had for as little as $14.99 by users who bought Windows 7 after June. As of February 1, the prices have changed, with the standard version of Windows 8 checking in at $119.99 and the Pro edition now setting buyers back $199.99.

The early discounts incentivized upgrade-minded customers to make a move, and with such incentives no longer in play, sales will likely shift from standalone licenses to those pre-installed on new machines. Enterprise migrations will eventually exert influence as well, but with many businesses still invested in Windows 7 and Windows XP, the ramp-up will be somewhat slow.

Though Windows 8 managed to match its predecessor's initial sales, the debut is still muted compared to legacy marks. Windows 7 launched in October 2009 and had acquired 7.71% of user activity by the end of the following January -- a share that far outpaces what Windows 8 has achieved. To be fair, there are more computers in the world today than there were three years ago, so Windows 8 would have needed to sell substantially more licenses to achieve the same impact. Even so, it remains unclear if Windows 8's ceiling is anywhere near as high as Windows 7's has proved to be.

If Windows 8 manages to reach great heights, it's difficult to know what role will be played by Windows RT, which Net Applications included in its Windows 8 stats. Recent rumors suggest that Nokia might produce an RT tablet in the near future, suggesting the platform might have some life. But Samsung has already scrapped plans for an RT device in the U.S., citing poor demand. And though Microsoft's own Surface RT has earned fans, it has also produced lackluster sales and reports of user dissatisfaction. IDC analysts have said Microsoft should slash prices on both Surface RT and Windows 8 to motivate sales.

In short, many questions remain. Will Windows 8 get a push when cheaper Ultrabooks and the coming Surface Pro hit the market? Will the eventual enterprise migrations erase memories of the mediocre start, or will mobile devices continue to encroach on the OS landscape, leaving it too fragmented for Windows 8 to assume Microsoft's typically dominant market position? Will Windows RT be a factor?

As Windows XP's massive user footprint attests, tectonic shifts don't occur overnight in the OS market. Microsoft still has time to shape the answers to these questions. The question is what the company will do to improve its odds.

Cloud Connect returns to Silicon Valley, April 2-5, 2013, for four days of lectures, panels, tutorials and roundtable discussions on a comprehensive selection of cloud topics taught by leading industry experts. Join us in Silicon Valley to see new products, keep up-to-date on industry trends and create and strengthen professional relationships. Register for Cloud Connect now.

Comment  | 
Print  | 
More Insights
Newest First  |  Oldest First  |  Threaded View
User Rank: Apprentice
2/19/2013 | 9:06:39 PM
re: Windows 8 Outlook: Murky At Best
Good Article.

I think that the elephant in the room though is that Microsoft is getting little or NO Upgrade licenses because Windows 8 not only offers no benefit to regular Keyboard and Mice type computers with no touch capability, but is actually it is a detriment (or plainly said a pain in the butt) for regular clam shells and Desktops. Windows 7 when introduced got plenty of upgrade business.

I am in the Technology Services business and I am getting startlingly more and more people wanting to revert back to Windows 7. I am able to persuade many to keep Windows 8 by installing "Start 8" which restores the Desktop Start button, nested programs and immediate Global Search, and sane shut down.

Also I am perhaps a great example of the Microsoft Win 8 license problem. I have 5 promos for Windows 8 upgrade Licenses at $14.95 since I bought 5 computers during the promo. I bought one and installed it successfully on a T61 Lenovo. I don't want the rest. Microsoft keeps sending emails saying "Windows 8 is here - What are you waiting for? Silly them -- you can't simply reply to these emails. If I could, I'd tell them -- I don't want Windows 8 for my clamshell notebooks and Desktops - Windows 7 interface is FAR BETTER for most computers out there now!

If Microsoft wants to sell A LOT of UPGRADEs - quit playing around and UN-HIDE the Star Menu on the Desktop. The faster boot, if nothing else, would be worth the upgrade.
User Rank: Apprentice
2/19/2013 | 2:49:53 PM
re: Windows 8 Outlook: Murky At Best
Microsoft has always had a hard time with both the Consumer and Business. Why? They go from one extreme to another.

MS: Consumers are using more mobile devices? Okay, letG«÷s develop an OS that is based on Touch Screens!
MS: Here you go GM our new OS, Windows 8!
GM: Um we canG«÷t use this interface. We use desktops and this Interface is designed for Touch screens. Sorry weG«÷ll keep using what we have.
MS: Oh

MS: Here you go Mom & Pop Shop our new version of Office; itG«÷s on the G«£CloudG«•! It doesn't have all the features you currently have and you have to pay a monthly subscription.
Mom & Pop Shop: Um We donG«÷t need the cloud we just want Word and Excel.
MS: Yea but itG«÷s cheaper.
Mom & Pop Shop: We donG«÷t need the cloud. Sorry weG«÷ll stick with Office 2010.
MS: Oh

Whoever they put in Market Research really should get some kind of hearing test done.
User Rank: Ninja
2/5/2013 | 2:49:04 PM
re: Windows 8 Outlook: Murky At Best
Slashing prices will not help much. Upgrade prices were down the past months and sales were still dismal. I do agree that the Surface RT is grossly overpriced, but even at a much lower price sales will not increase much. The reason: any mutation of Win8 is rejected by customers. The number of those who outright dislike it is a magnitude higher than those who do like it. Also, the sales figures from Microsoft are for license shipments. A good bunch of those licenses is left unused, for systems that will never be built, system that sit in a warehouse, and systems that get immediately upgraded to Windows 7.
If Microsoft wants increased sales then Win8 just needs to become a much better product. Ditch Metro, use the Win7 UI, and finally react quickly to user feedback. If Microsoft had done that in the first place a lot of the rejection would not even come up.
Uh, and one more thing Microsoft needs to do: fire Ballmer!
User Rank: Apprentice
2/4/2013 | 7:49:41 PM
re: Windows 8 Outlook: Murky At Best
Windows 8 still has hope if it can accomplish two things extremely quickly. 1. Give Win8 a patch to allow users to switch from Win8 "touch" user interface to Win7 user interface and back easily as they upgrade to touch hardware. This will help them maintain desktop OS dominance and curb users deciding to go with Apple OS X. 2. Build an emulator that will run in Windows that will allow using Win RT apps and allow those apps to share info through their cloud. Microsoft is lucky Apple has been off its game. If the developer of IOS and OS X got along and had an emulator to run IOS apps in OSX and even Windows developed, Apple would not see their tablet marketshare dropping. Apple however has corrected that issue by getting rid of the IOS developer with issues and they may be the first to get the desktop and tablet sharing lightweight apps. It's a different world of put it out there and users have to deal with it. End users have choices now and whoever caters to them best will be rewarded.
User Rank: Apprentice
2/4/2013 | 7:35:04 PM
re: Windows 8 Outlook: Murky At Best
Using web traffic measurements is probably a good metric, especially early in the release of an operating system. One would capture the folks who are upgrading existing systems to the new OS. However, after the early upgrade season, those metrics are now measuring two effects -- which, as the statisticians would say, are confounded. The two effects: 1) Sales of new PCs, because one needs new HW; 2) Sales of new PCs because one wants the new OS. If we look at the pace of Win8 growth on the web traffic metric, we can't tell why it isn't as fast as Win7 was. Are fewer people buying PCs because they would rather have tablets? In that case, it would not matter if the PCs were running Win7 or Win8. It's not a knock on the quality or features of Win8. Are fewer people buying PCs because they dislike Win8 and would rather stick with last years' Win7 box? If that's true, then MSoft has some work to do. But can we really tell what the underlying reasons are?
User Rank: Apprentice
2/4/2013 | 7:15:56 PM
re: Windows 8 Outlook: Murky At Best
I love how somebody writes a long-drawn out story, then starts the second to last paragraph with "in short".
User Rank: Strategist
2/4/2013 | 6:26:08 PM
re: Windows 8 Outlook: Murky At Best
I find it ridiculous that Microsoft insists that we desktop users boot to a useless "app" interface designed for phones and tablets. At least with the old Vista Gadgets we could turn them off and pretty much ignore them. But now we have "Gadgets on steroids" becoming "active tiles". Well, excuse me, but I'm underwhelmed. Seems Microsoft is only making money for Stardock and their Start8 program, or one of the free ones like Classic Shell. As a desktop user please give us the option of customizing this stupid interface to be as WE the CUSTOMER want it to be, and not as some 20-something year old programmer thought was "cool". I mean why use any freaking "app" on a real desktop PC when you could just as easily (and with far more functionality) go to the real thing. Facebook is a case in point. The app is worthless compared to the actual web site. Microsoft needs to wise up and realize that pushing people to adopt an O/S's quirks when they are not wanted will not endear them to their user base. It is fine that they want to include tablet and phone functionality in Windows, but just don't force us desktop users to fool with it. It's like giving us a tool kit but making us always pick up a hammer when we want to get to a freaking screwdriver, and then having to waste time picking up the hammer between uses of the screwdriver.
User Rank: Apprentice
2/4/2013 | 6:05:59 PM
re: Windows 8 Outlook: Murky At Best
Microsoft absolutely needs to lower prices. They can afford it, too. Without market share they will die a slow death, and what they're pushing isn't good enough to build market share. Too many people buying tablets and smartphones and just don't need a laptop or computer for personal use anymore. And developers are spending more (in some cases, all) of their resources building for mobile platforms and the web, not for native Windows. Windows is now mostly just a way to get the web browser, and it's too expensive. I can now buy a $60 mini PC wtih HDMI out, USB, and Android 4.1. Except for playing games it can do everything a windows PC or laptop can do. If I want portability, I can use the same apps and browse the same websites on a tablet and/or smart phone (I prefer Nexus 7 and Galaxy SIII, but have iPad and iPod Touch as well, pretty much same stuff on both platforms). Microsoft needs to realize they aren't premium any more in anything but price. Yes, once they lower prices they can't go back again, but nobody else is going back, either. Face the music and dance the new dance, MS, you're wasting time and future profits...
User Rank: Strategist
2/4/2013 | 5:12:16 PM
re: Windows 8 Outlook: Murky At Best
OK if users did not buy Windows 8 updates in droves when it was dirt cheap. Who really expects them to shell out $119? I totally agree with the discount ideal. The Surface cannot grow without users. Developers for apps will go away and users that did buy a Surface will face a sudden end like the Zune player. Don't think Microsoft will just drop support for the Surface? Seriously where have you been? Now we have HP trying to sell Chromebook's? Is this not a sign that PC makers are not happy Microsoft? My thoughts are to replace Ballmer, get working on patches and fixes for what users don't like about Windows 8. Accept that Windows 8 mobile is also never going to take off. Put office on as many platforms as you can before it too becomes a forgotten oldie.
Then work on a "real" OS for tablets and a real OS for PC's. The whole touch thing on a PC has never worked and its only used on a tablet because who is going to carry a mouse around for a tablet?
User Rank: Apprentice
2/4/2013 | 3:26:41 PM
re: Windows 8 Outlook: Murky At Best
Thank you for being honest! The "news" on Windows 8 and the Surface have largely been so positive you really had to wonder if the pundits were seeing the numbers. There just seems to be a curious tendency among tech writers to present Windows 8 in a positive light.
Register for InformationWeek Newsletters
White Papers
Current Issue
InformationWeek - September 2, 2014
Avoiding audits and vendor fines isn't enough. Take control of licensing to exact deeper software discounts and match purchasing to actual employee needs.
Flash Poll
Twitter Feed
InformationWeek Radio
Archived InformationWeek Radio
In in-depth look at InformationWeek's top stories for the preceding week.
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.