'Critical point' for Windows starts on Tuesday

'Critical point' for Windows starts on Tuesday

Whatever Microsoft calls Windows 8's successor, it better wow the enterprise.

When Microsoft unveils its next edition of Windows on Tuesday in the US, it will face its greatest challenge ever in operating systems, an analyst has argued.

"There's never been a more critical point for Microsoft related to operating systems than now," asserted Patrick Moorhead, principal analyst with Moor Insights & Strategy. "Enterprises are now considering what's going to happen in the next five to ten years."

Wes Miller of Directions on Microsoft concurred. "I do think this is pretty critical," Miller said. "In the enterprise, lots of businesses are wondering how long they're going to stick with Windows 7."

Microsoft is expected to reveal its upcoming Windows tomorrow at an invitation-only press conference in San Francisco starting at 10am Pacific Time (1pm Eastern Time). The focus of this initial introduction will be how the next Windows -- codenamed "Threshold" and preemptively dubbed "Windows 9" by some -- works with traditional personal computers, those that dominate in business and rely on mouse and keyboard input, not touch.

The introduction will signal just how far Microsoft has retreated from the radical thinking that went into Windows 8, which most have decried as a flop, in order to appeal to its most profitable customers, the corporations that have essentially ignored Windows 8. The company may also provide details of the naming of the new OS, and whether it will be offered free to customers already running Windows 8, or even Windows 7.

"Microsoft must push forward on the tablet and phone front with a touch-enabled OS, but the great takeaway from Windows 8 is that they can't do that at the expense of ignoring the desktop," said Ross Rubin, principal analyst at Reticle Research.

While some may argue that Microsoft has faced similar situations in the past -- notably the introduction of Windows 7 in 2009 after the failure of Windows Vista -- the scene today supports Moorhead's take that this time is different.

Then, personal computer sales were still on the upswing -- Peak PCdidn't happen until 2011 -- while the iPad, and the explosion of tablets in general, was months away. Smartphones were still the purview of the well-to-do. Apple was selling fewer than two-thirds the number of Macs that it does today. And OEMs, the computer manufacturing partners Microsoft relies on, weren't shilling systems powered by Google's Chrome OS because, well, Google had not even released its own reference hardware yet.

Those headwinds now blow Windows' way.

"PC OEMs are holding their breath," said Moorhead. "To be frank, they were so disappointed with Windows 8 that they're taking a conservative approach to expectations" for Threshold. "But at the same time, they're cautiously optimistic because they really don't have a choice but to participate."

Another stumble with the next Windows won't stop OEMs from shipping Windows on their machines -- as Moorhead noted, the alternatives are meager -- but it would open the OS to even more inroads by rivals.

"Windows 8 has given iOS, Android, Chrome OS and OS X more and greater access to the enterprise," said Moorhead. "Microsoft has a chance to turn around the perspective [of Windows] with Threshold and minimize the risk [of further erosion]."

Threshold is important because, as Moorhead and others have pointed out, enterprises should already be looking ahead to what they will use to replace Windows 7, which has become, like Windows XP before it, the OS standard bearer for business.

While Microsoft will provide security updates for Windows 7 until January 2020, companies that want a smooth migration from old to new should be planning now for its replacement, Gartner analysts said last month. That replacement could be Threshold, if Microsoft effectively makes its case starting Tuesday. "[Microsoft] needs to give customers an idea of what the road map is going to be," said Gartner analyst Michael Silver in an August interview.

If Threshold is simply a warmed-over Windows 8, then enterprises may well postpone migration plans and hope that whatever comes after that is more palatable. But during the interim, there's the chance that they will look even harder at alternatives, like Macs and Chromebooks. Although neither can conceivably supplant Windows, PC sales are a zero sum game at this point: Every machine sold with Chrome OS or OS X is a loss, perhaps permanently, to Windows. And thus the spiral quickens.

"Threshold will either put points in Windows' column, or in [those alternatives'] columns," said Moorhead.

At least Microsoft has history on its side: Since Windows 98, the company has alternated well-received and rejected editions.

"Ideally, this next version of Windows will continue an amazing streak of alternating releases," said Rubin. "There was Windows 98, which was good, and then Windows ME, which wasn't. There was Windows XP, then Vista. Windows 7, then Windows 8. So this is an opportunity to address their users' demands, as they have historically done."

"I'm hoping for the best," said Miller. "I like what I'm hearing [about the next Windows]. But this is make or break."

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