Is Windows 8 For Tablets Already Dead?

A few shots were fired against Windows 8 and its tablet edition today. There is the thought that Microsoft may have missed the best opportunity to introduce Windows 8 for tablets, or may have missed an opportunity to grow he interest in Windows tablets and make you lust after a juicy Windows 8 tablet. With the iPad, Amazon and Barnes&Noble, the market could be saturated and the overall mood in the tablet market appears to agree. Should Microsoft simply scrap the idea to run Windows 8 on tablets?

Windows 8 Start Screen: Tiles can be rearraged

How the tablet expectations have changed. We are still talking about an opportunity of apparently gazillions of tablets per year and an environment where we generally believe that it is everyone’s opportunity to lose – despite the fact that we have not seen a single successful Android tablet yet. If there was anyone who needed a confirmation that tablets are not about hardware, but about the platform value, that evidence should have been provided with the Amazon tablet, which underwhelms on specs, but is sold solely through brand and platform perception. Not that it has been a secret, but Amazon and Barnes&Noble have been the only major companies that followed through with this thought and offer devices that now occupy the tablet opportunity below in the $250 range and below.

The impact was strong enough to convince traditional PC makers that there is no significant profit left and that a quick exit may be a good idea. In a best case scenario, market analysts in Taiwan now believe that non-iPads and non-Kindles may be able to capture 10 to 15% of the tablet market. Forrester’s opinion adds to that depressed mood and states that “Microsoft has missed the peak of consumer desire for a product they haven’t yet released.: While 46% of consumers wanted a Windows 8 tablet in Q1 2011, only 25% wanted one in Q3. Measuring consumer interest in an imaginary product that lacks the perception value of the Apple product is a stroll on thin ice and little more indication of a potential market, so those 46% should be taken with a grain of salt.

However, Forrester has reason to criticize Microsoft that it has not maintained the Windows 8 momentum and Microsoft marketing has clearly failed to keep Windows 8 tablets in our minds. The spicy part of that failure is not so much that Microsoft did not market Windows 8 or its port to ARM or any potentially great hardware. The failure is that we have no idea what experience Windows 8 will offer on a tablet. Forrester reminds us that late-comers to a market, what Windows 8 clearly is, need differentiators to succeed. The Kindle Fire succeeds by offering the Amazon cloud platform and most of the Android tablet experience for a relatively low price that is backed by a strong brand. Forrester says that Microsoft has to take a lesson from Amazon to turn the corner. That, of course, would require that Microsoft is failing at this time.

Sure, the marketing was underwhelming, but is Microsoft really failing? I believe that this is a questionable assumption to make.

Tablets have platform value. To understand a Windows 8 tablet, we need to understand the Windows 8 platform and the public has not seen this platform. We don’t know much integrated the platform will be and how Microsoft will connect PCs, tablets, phones and its strangely under-marketed Xbox Live platform. If Windows 8 seamlessly bridges PCs, tablets, phones as well as its video game and entertainment service, Microsoft has, conceivably, the most powerful platform with an very compelling value proposition. Windows 8 could easily become the fabric that bridges the gaps Microsoft currently has to deal with. Imagine a tablet that accesses content on Xbox Live, imagine you can play the same games on your tablet that you play on your PC or TV. Imagine a phone that can access private data in the same way a PC does and a tablet does – via Microsoft’s Skydrive cloud service. In many ways, Microsoft is further along than Apple. However, Microsoft needs to find a way to connect the loose ends and create a platform value that will convince you to buy a Windows tablet and phone.

What we tend to forget about Windows 8 is the fact that it is a bet on touchscreens and the fact that touchscreens have never worked on vertical screens such as notebook and desktop screens. Touchscreens are made for horizontal applications. Other than the majority of analysts, we believe that the Windows 8 touch interface is a pretty risky strategy for traditional PCs, but makes sense for tablets. Very few users want to reach across a keyboard and touch the screen with one hand while supporting it with the other. If the Metro interface works, it will work best on tablets.

Microsoft should be thinking about some tablet marketing, but it will be more important to create an integrated platform experience, not just software that happens to run on a tablet. If Windows 8 will be integrated across phones, tablets, Xbox Live, and PCs, Windows 8 tablets have a big opportunity to make a big impact.

Wolfgang Gruener in Business on November 29