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Microsoft Build: 3 Windows 8 Questions To Answer

Microsoft has a chance to regain control of the Windows 8 narrative at Build conference. But can the company execute where it has stumbled before?

10 Hidden Benefits of Windows 8.1
10 Hidden Benefits of Windows 8.1
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From Windows 8.1 to standout third-party apps, we already have some idea what Microsoft execs will talk about when the company's developer-oriented Build conference kicks off Wednesday in San Francisco. The effect of these discussions, though, is an entirely different matter.

Redmond faces big questions, such as whether a Windows that features Live Tiles can ever be as popular as older versions. Yet it's easy to blow the company's perceived struggles out of proportion. True, the PC market is a shell of its former self, and Windows 8 has undeniably underperformed. But Microsoft has also conjured billion-dollar revenue streams out of Azure and Office 365.

So how high are the stakes that Microsoft really faces? The answer is somewhat relative. "I don't worry about Microsoft's future," Forrester analyst David Johnson told InformationWeek in a phone interview earlier this month. "There's always going to be a need for the Windows desktop and Windows applications."

"However," Johnson continued, "that does not mean Microsoft is not at risk of further disruption."

[ Is a major shakeup in store at Microsoft? Read Microsoft Reorg Rumors Heat Up. ]

On the one hand, Microsoft is a colossus of a company, and to reduce it to Windows is myopic. And even if one embraces this tunnel vision, Windows is hardly at risk. Windows 7 is still going strong, and many companies are far too invested in Redmond's infrastructure and workflows to switch. Windows 9 has a huge built-in audience.

Then again, Microsoft's ability to diversify its business is to some extent tied to its ability to leverage Windows. Any erosion to the Windows user base will reverberate elsewhere in the company lineup.

Those erosions are happening. Some are small. Knowledge workers will continue to type away at keyboards for the foreseeable future, and most of them will do so using some version of Windows. But the viability of alternatives such as OS X and Chrome OS has slowly increased. As IT departments become more comfortable with BYOD and heterogeneous environments, this trend could potentially accelerate.

These desktop competitors are unlikely to threaten Microsoft's dominance of the PC space. But unfortunately for Redmond, the significance of those traditional computers is dwindling. Conventional PCs won't become obsolete anytime soon, but Windows 8 has failed to win Microsoft a substantial share of the tablet game -- and that's where all the growth is happening.

Research firm Gartner projected Monday that OEMs will ship more tablets and ultramobiles, such as laptop-tablet hybrids and Chromebooks, than PCs by the end of next year. The firm also predicted that over 1 billion new Android devices will ship in 2014, and that Windows devices will battle Apple devices for second place, both with fewer than 400 million units.

That sounds dramatic, but it still leaves Microsoft with a lot of business. Smartphone shipments inflate both the Apple and Android figures, and though a few users might love their iPhones enough to dump Windows for OS X, handsets aren't really a direct assault on Windows 8.

Tablets are another story, though, especially as they become the preferred form factor of consumers and many BYOD workers, and as businesses find new ways to use them. The majority of desktop users might continue to use some version of Windows, but if the number of desktop users becomes dwarfed by the number of mobile users, Microsoft's role in the tech hierarchy could look very different.

Microsoft is a company that's accustomed to monopolies -- literally. It will continue to make billions of dollars for years to come. But what if it becomes merely a big player, rather than the biggest player? What if Microsoft becomes something like IBM, a company that once had a consumer presence but is now associated entirely with the office?

These questions -- the true stakes that Microsoft faces -- will dictate the decisions employees, IT managers and businesses make over the next decade. Microsoft CEO Steve Ballmer's position is clear: as his "devices and services" vision suggests, he doesn't want a few markets -- he wants all of them.

How can Build shape this future? To stay on the path to realizing Ballmer's goal, and to stave off Apple and Google, Microsoft will need to answer the following three questions:

1. Windows 8.1 will be better, but will it be compelling?

At launch, Windows 8 was already more secure than Windows 7. The new OS's fast boot times also made its predecessor look positively prehistoric. Criticisms related to unfamiliar Modern UI and weak app library overwhelmed these and other benefits, however, and Win8 has been widely viewed as a disappointment.

Windows 8.1 includes a number of enhancements, including better multitasking in the Modern UI and more customization options. But the headline features, such as restoring Windows 7's Start button and including a boot-to-desktop mode, are mostly about addressing user complaints, not substantially advancing the Live Tiles concept.

Forrester analyst David Johnson said, "Anytime you directly address the top complaint the enterprise has had with a product, it's a step in the right direction." He noted that companies have been concerned about training employees to use the new interface, and that Win8.1 seems to be fixing that.

He countered, however, that the new Start button is not a Start menu but a Start point, and indeed, it remains to be seen whether Microsoft's semi-concession passes muster. And even if the new Start button makes enterprise users happy, will it speak to hesitant consumers?

Gartner analyst Carolina Milanesi told InformationWeek in April that "if Microsoft gets the consumer, they will eventually get the enterprise." BYOD adoption, in other words, is the difference between a business-oriented Microsoft that is big but never as important as its former self, and a new, mass-appeal Microsoft that lives up to the Bill Gates era. David Cearley, also a Gartner analyst, told MarketWatch that "Windows 8.1 could be what Windows 8 should have been."

That doesn't inspire confidence. With Win8, Microsoft was already late to the mobile game. If Win8.1 merely delivers what Redmond should have produced last fall, the platform isn't exactly catching up fast.

Cearley speculated that the update "could quiet many of its detractors," and perhaps it will. But Microsoft must show whether it can actually reach BYOD consumers, or whether it will merely appease its traditional commercial buyers.

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