Whether Microsoft can rebound with Windows 8.1 likely depends on how charitably one defines "rebound."
In the enterprise, Microsoft should see a meaningful uptick. Windows 8 will probably never be as big as Windows XP or Windows 7, but Windows 8.1 should ensure the OS won't turn into Windows Vista either.
Millions of commercial Windows XP users will be under pressure to upgrade by April, when the OS loses support. So far, most of these upgrades have gone to Windows 7, and many of them will continue to do so. But Windows 8.1 will include a boot-to-desktop option, enhanced security and VPN features, and a restored Start button. Thanks to these enhancements, Microsoft hopes Win 8 will attract companies that are upgrading not only OSes, but also hardware.
Windows software isn't going to stop being important to businesses. As companies that have already switched to Windows 7 begin to buy new machines in coming years, Microsoft can expect many of them to switch to whatever version of Windows is most current. Plus, there is the virtualization trend and products such as Windows 8 to Go, which enable Windows to persist even when workers use non-Windows hardware. Microsoft is also intelligently leveraging Azure to compensate for the decline in Windows' stature.
Still, it all falls short of Microsoft's historic world-beating standards and also the "one Microsoft" vision around which Microsoft CEO Steve Ballmer recently reorganized the company.
To meet loftier goals, Microsoft also needs to tap into BYOD and consumerization trends. For established enterprise workflows, Windows beats all comers. But new movements such as BYOD have begun to impact business workflows in more organic ways. Apple didn't become an enterprise player because of strategic planning; it became one because people liked using the iPad and found ways to use it at work. This encouraged developers to make line-of-business apps, and now Apple and Android tablets are in workplaces all over the world. Microsoft needs to find a way for Windows 8 to inspire comparable user interest.
Unfortunately for Microsoft, it's not clear if Windows 8.1 can generate this kind of user enthusiasm. The update is an objective improvement over Windows 8, but it isn't a top-to-bottom redesign. If users truly hate the Modern UI, the update isn't going to appease them. Microsoft's best hope is that people abhor Live Tiles less than they think they do.
Window 8's infamous learning curve is manageable but takes at least a little effort. It's possible that some Win 8 dissenters were simply so discombobulated by the Modern UI that they never gave the OS a chance. In the best-case scenario for Microsoft, Windows 8.1 will allow users to become comfortable with the UI more quickly, leading to fewer kneejerk dismissals of the interface.
Intel's new Haswell and Bay Trail chips should also help by endowing Windows 8.1 tablets with stronger graphics processing and better battery life. More affordable Windows tablets will help too, though many models, including the recently discounted Surface tablets, still cost more than competitors' offerings.
We may, as many argue, have entered into a "post-PC era" dominated by smartphones and tablets, posing a challenge to companies like Intel and Dell and Microsoft that were leaders of the PC era. It is still unclear whether the past leaders can transition into leadership positions in the new era. One thing is clear, however: Microsoft needs to do more than hope that keyboards will drive sales of its flagship operating system.