Friday, April 12, 2013

No, Windows is not dying (although Microsoft is strangling it) On the heels of Gartner's latest gloomy predictions for the PC market, it's amazing how people can twist numbers around.

It's always amazing how people
interpret the stats from the
market research firms and tell
you what to think of them. Today
is a pretty good lesson in lies,
damned lies, and statistics.
Gartner issued a report that
predicted worldwide devices,
which includes PCs, tablets and
mobile phones, will grow 9% this
year to 2.4 billion devices, and
will reach 2.9 billion by 2017.
RELATED: Microsoft's
relationship with Samsung gets
ugly
Surface tablet compared to Zune,
Kin in brutal analyst assessment
Not surprisingly, that growth will
come largely from smartphones
and tablets. The two will account
for 2.07 million devices sold this
year and 2.6 million devices by
2017, which makes for 57%
compound annual growth.
PCs and Ultrabooks, which are
split into two groups, will enjoy a
CAGR of 20%, with Ultrabooks
poised to really take off in 2017
and make up for decline in PC
sales.
So, of course, out comes the
doom and gloom. " Microsoft
Could Be Obsolete By 2017:
Gartner Report " said an
irresponsible Yahoo Finance
article. " Microsoft threatened as
smartphones and tablets rise,
Gartner warns, " claimed The
Register.
Really? Where did you see that in
Gartner's report?
The fact is, Gartner expects
Microsoft to be second to
Android devices come 2017,
mostly on the strength of PC
sales, not smartphones. It will go
from 354 million devices this year
to 504 million devices in 2017.
I don't see obsolescence, I see
growth, just not as fast as
Android. And Android is growing
because it's free. Slap it on a
white box phone or tablet from
China and it's one more to the
pile.
The report doesn't take into
account two major threats to
Android: 1) fragmentation, which
is driving developers crazy, and
2) Tizen, the Samsung/Intel
smartphone OS project. I don't
know if it will set the world on
fire, but it sure has the potential
to fragment it.
The PC market is a mature one.
These days, almost every
household I know has more PCs
than people, but fewer phones.
Most people only need one phone
line. Still, feature phones are
about half the market in the U.S.
and most of the market
worldwide, so of course there is
room to grow that PCs don't
have. And it's very hard to sell
people on upgrades when PCs
are working fine, and Windows 7
seems much more palatable than
Windows 8.
None of this excuses Microsoft. It
seems to have blown its
relationship with Samsung, which
was not a good move, and the
Asian PC suppliers are near open
revolt over Windows 8. Windows
RT appears to be stillborn and
Windows Phone 8 is loved by the
people who have one, but too few
to make it a success.
Plus, there is growth to be had in
the PC market if you chase it. A
few weeks back, Gartner issued
its Q4 PC sales report, and
Lenovo was up while the rest
were down. Lenovo competes
aggressively on price and margin,
but it also offers a full warranty
for people who downgrade to
Windows 7, and they created
their own Start button software
for Windows 8 customers. So
there are some vendors who
know how to sell a PC.
The slowdown in PC sales is
undoubtedly in part due to
Windows 8 leaving a bad taste in
people's mouths. There are other
reasons that are beyond
Microsoft's control, but
competition is not one of them.
Microsoft's greatest enemy is
Microsoft. Not Apple, not Google
and not Samsung. And it's doing
a pretty good job of hurting itself
with its misguided Windows 8
policies. But it also has the
ability to stop it.

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