MSFT: The Application that dare not Speak Its Name

There have been recent reports about the decline in global PC sales. Laptops replaced Desktops are the most common "PC" platform 5 or more years ago. What impact on the market will this have?

We're in the "post-PC" world, where PC's don't go away, but aren't the sole choice in the consumer market. In the x86 processor 'space' we've got Server, Workstation and Gaming platforms as well as "consumer" PC's. All have different architectural tradeoffs, all run to different price-points and all have very specific user-groups with well know needs.

What we haven't seen is the market break-down change since the release of the Netbook (2007), then the smartphone and tablet (2007 & 2010). The many attempts to produce the $100 PC, like the One Laptop Per Child Project, have at best been middling successes. They've rather been overtaken by Android Tablets now.

PC's in the their many forms are not going away anything soon, but the design may morph and evolve.
What we're already seeing writ large, is the impact on vendors of consumers holding onto PC devices for extended periods. A dear friend who's retired uses Windows-XP on a 10-yr old Dell PC and is very happy with it. It does everything they need, with more than adequate speed. I've already THE conversation with them: Win-XP goes out of support next year, what then?

PC's won't die, but their average age will increase and sales of new devices will reflect this glacial replacement rate while the numbers in use will stay constant. With compute power doubling every 3-5 years now, not every year, individuals and organisations can afford to keep their computing assets for much longer, even until they expire...

We might expect that the market-segments we're now seeing for Computing Platforms and Appliances are going to be with us for some time as we reach further and further into the "end of the Silicon Revolution". The first signpost of which was in 2002 when Intel single-core CPU's hit The Heat Wall.

Circling back to the subject: How does this impact Microsoft and those reliant on its ecosystem?

Microsoft and it's ISV's seem to have a lock on the Enterprise Desktop. Nobody else seems to be addressing the 1,000+ fleet market segment.

As above, for domestic, SOHO and SME use, more and more people are "staying with what they've got". Hardware refreshes are becoming further apart and moving from Win-XP, the most popular Windows ever, to anything is a major decision and effort.

Microsoft lost one of its prime marketing tools when they missed the Longhorn delivery date and PC hardware evolution slowed: customers were no longer on the forced upgrade treadmill, then found they could get by very nicely with what they had.

But the most interesting market for new entrants to the software market is mobile devices.
Mobile Apps are where most Start-Ups are focussing their efforts these days.
If you don't already have a strong software business, why would you put effort into a market that's matured and where sales have been static for some time/

New Software Enterprises are focussing on Mobile Apps, and there are only two ecosystems of interest if you want to create a growth business:

  • iOS, based on Objective-C, and
  • Android, based on Java.

The problem Microsoft now has is gaining a toehold in the Mobile Apps world.
Having missed with Windows Phone, Win-7 and Win-8, their market share on the new explosively growing market is small and falling. My failing memory thinks I've seen a figure under 5% share. Can't recall.

New Software Developers have to make some hard choices, the hardest of which is to focus.
WIth very limited resources, they must choose what platform to develop for: the tools and skills needed are very different. Whilst their are multiple cross-platform toolkits, I'm not sure how good they are...

The only new entrants into Software for whom Windows-8 will be remotely interesting are those with extensive experience and knowledge/skills in Microsoft Development: this is typically only existing ISV (Independent Software Vendors).

So there's the rub for Microsoft: the very factor that led to their dominance of the PC market for 2 decades, extensive third-party software for their platform, has now turned against them. They are the distant last-place in this race that no new entrants will want to adopt.

Only long-running Microsoft-based Software companies will even consider creating Mobile Apps for Windows-8, and they are most unlikely to be Must Have.

The New Cool Apps will all be for Apple and Android. Win-8 may be great, but will be locked into Enterprise environment.

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