Ronnie05's Blog

Has Microsoft lost out on its Tablet opportunity? (Part II)

Posted in Industry updates, Mobile Computing, Mobile Devices and Company Updates by Manas Ganguly on December 16, 2011

Continued from an earlier post

In the earlier post i have examined 2 reasons why Microsoft’s bet on its legacy enterprise solutions is not a surefire formula to success in next generation computing devices. In this post, we examine the other 2 reasons: Applications and Pricing as two other deterents to the success of Microsft in Tablet space.

The mastery in Apps…
Windows 8 is the Microsoft’s most important bet ever. However, Windows 8 is only a tablet on the surface — there’s no guarantee that app makers will jump on board to create great touch-enabled apps as they have for the iPad.
Microsoft has pushed its own proprietary developer platforms like .NET and Silverlight. The main programming environment for the Tablet UI — is going to be HTML5 and JavaScript. This is a conflict situation around Windows 8 which Microsoft needs to clarify for the developers to think, plan and work with the platform.

Android and Apple have moved in on application development, and even enterprise use, areas where Microsoft with its cadre of developers should have been reigning supreme.

The Pricing Conundrum
The upcoming tablets running Windows 8 are being squeezed between low-cost tablets from Amazon and the $500 iPad with its well-established ecosystem.

On the low end, Amazon and Barnes & Noble can sell tablets as a loss-leader that get users to buy more digital content. Microsoft can’t compete there because it simply sells the operating system and its hardware partners won’t be willing to match Amazon’s price because they have no services on which to make money.

Microsoft’s fee for Windows 8 tablet version will be $30+. If that is true, right off the bat, the bill of materials costs of Windows 8 tablets will most likely force prices much higher than today’s low-end iPad. If Apple starts lowering its prices in 2013, as I suspect it will, Windows 8 tablets would be at premium pricing. Microsoft’s PC partners simply might not be able to make the kind of tablet hardware that captures users’ attentions and wallets as the iPad has done.

Summarizing the scenario… slow development and delivery schedule isn’t Microsoft’s only problem- iPad’s move into office productivity, consumer interest in Android tablets, pricing of the tablets (at least versus Android) and the level of OEM support for Windows tablets may be affecting consumer interest.

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