The press has called the launch of Windows 8 a "defining moment" for Microsoft as it struggles to transition to the new generation of mobile computing. The media, as well as Microsoft shareholders, are closely watching the launch and rightly so. The Windows Division is a cornerstone of Microsoft's business model, responsible for 31 percent of the company's profit in the third quarter. It's assumed that Microsoft must protect the Windows business if it's to survive.
The success of Windows 8 would not only defend the lucrative Windows Division, it could rescue another hugely important division of Microsoft business: online advertising. That business, known as the Online Services Division (OSD) comprised of Bing, MSN network, Atlas and Hotmail, has been a disaster. The division is most notorious for the ill-advised purchase of aQuantive advertising firm, a $6.2 billion blunder Microsoft wrote off this year. That aside, OSD continuously weighs down Microsoft. In the third quarter it operated at a loss of $364 million compared to the Windows Division profit of $1.6 billion. OSD was the only Microsoft division to operate at a loss in the third quarter.
Microsoft's opportunity to turnaround its struggling advertising business lies within the new Windows 8 interface, known as Metro. The Metro interface does away with the old-school Windows icons and replaces them with web-connected "tiles" that dynamically pull in updates for things like weather, news, social and email. These tiles amount to desktop apps that, just like mobile apps, can be ad supported. Google, Netflix and The New York Times are among 9,000 companies that have already built desktop web apps for Windows 8. As the owner of the app store (called Microsoft Windows Store), Microsoft, like Apple, has implemented a 70:30 revenue share with developers. Microsoft hopes it can parlay Windows 8 penetration of the PC market into a position of strength in the online ad market.
For that strategy to pay off, Windows 8 must replace web browsing with dedicated apps. That's exactly what happened in mobile computing and Apple turned that into a healthy business -- reportedly paying out $2.5 billion to developers in 2011. The good news for Microsoft is that the PC app market may turn out to be a bigger business. Time spent with PC accounts for 26 percent of a consumer's time compared to 10 percent for mobile, creating a bigger inventory set.
The app-based interface of Windows 8 is also a key component of Microsoft's strategy to combat Apple and Google in the mobile and tablet market. If consumers download desktop apps for their Windows 8 PCs, they may want them available on other devices, boosting the appeal of Windows 8 phones and tablets. If Windows 8 is a success, Microsoft advertising business could become the company's newest bright spot, instead of its perennial black eye.
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iPhone $200 (with contract)
iPad $600 (32GB)
MacBookPro $1200 (4GB/500GB)
$2000
Window HTC8X $50 (with contract)
Surface $500 (32GB)
UltraBook $550 (4GB/500GB)
$1100
I know anything I buy is going to be obsolete in a couple of years, so its hard to justify the extra money. I asked them what they needed: Music, games, texting, making calls, email, browsing, word processing, Netflix, Hulu, Skype and Facebook.
Music would be the show stopper, since they use iTunes on their generation one iPhones. It turns out that when you plug a Windows 8 phone into a device running iTunes, you can move the songs to a Windows 8 device. http://www.windowsphone.com/en-us/how-to/wp8/music/copy-my-itunes-music-to-my-phone
I asked what apps they were using and they told me Facebook, Netflix, Hulu and Skype. They all run on Windows 8. And since they are Xbox junkies, using Windows 8 devices actually makes sense.
The price difference is $900 dollars. When you need to buy new devices for two kids in college like me, that's $1800 that can go toward their tuition!
Convince me in rational way to buy Apple stuff, other than Windows 8 sucks.
Not.
Give it a few more years. By then W8 might be ready for prime time. Right now, it's a bad idea executed poorly. The best I can say about it is it's meh (which I've been saying for months).
I'm sure they'll survive, but this is really not the way to go about this... per usual with them.
Hyperbole.
MS isn't going anywhere! even if Windows 8 tanks.
Or didn't you notice that they fired the guy in charge of developing it about a week after it was released?
I can't think of one single thing about 8 that's as good as 7. It gives fewer options and is much more annoying in several different ways.
Next time I'm going to spend the extra money and go with a Mac.