Microsoft Could Lose More Than Consumer Market To Tablets

Businesses are starting to ditch Windows PCs and notebooks in favor of mobile devices from Apple and others, triggering little response from Redmond.
Here's what USAID CIO Jerry Horton had to say about Apple's newest mobile devices: "The nice thing about the iPad and iPhone is that the development environment is fairly simple. It doesn't require a lot of resources to develop an application." And the iPad isn't supposed to be a threat to Microsoft in the enterprise? Whole teams of in-house developers have gone missing for months trying to roll out a single Windows app.

Utilities developers are also getting in on the act with tools that will make it even easier for companies to tap Windows apps through the iPad, thus reducing the number of PCs and notebooks employees need. Citrix Receiver for the iPad, Wyse Technology's Pocket Cloud, and HLW's iTap are all secure access clients that allow workers to get all their business applications securely through the iPad.

Even if enterprises replace just one of four Windows PCs with a non-Windows tablet, that would still mean a 25% cut in Microsoft's enterprise Windows sales, not to mention related maintenance and upgrade fees. And that would be on top of significant downward pressure in the consumer sector, where tablets, mostly the iPad, are absolutely killing PC sales.

Deutsche Bank analyst Chris Whitmore this week cut his estimate for worldwide PC market growth in 2011 by more than half—to 4% from 9%--after concluding that tablets are "usurping" the PC. "Apple remains the primary beneficiary of this technology transition which is increasingly coming at the expense of PC vendors," said Whitmore in a research note.

Microsoft may have already lost the tablet consumer market. What must it do to ensure the same thing doesn't happen in the enterprise?

While the company is already behind the curve, it can still take advantage of the fact that almost every major company runs Windows desktops and related infrastructure, and if there were halfway decent Windows tablets available they would be the natural choice because, in theory at least, they should be the easiest and cheapest to integrate and support.

Microsoft and its hardware OEMs can't produce an iPad rival when they really need to, which is right now, but Microsoft should at least provide a clear message to its business customers that it's committed to slates, offer a reasonable timetable, and start to engage developers and in-house IT teams immediately. Because if all CIOs and their staffs hear from Microsoft in regards to tablets is silence or worse ("blah, blah, blah"), they'll have no reason to hold off testing and deploying what's already available from Apple, Google and its partners, and RIM.

So Microsoft, what's your tablet strategy for the enterprise? CIOs need to know now.

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