by Rob Enderle

Windows 8: Assessing IT Risks of a Consumer-Driven Wave

Feb 09, 20126 mins
Computers and PeripheralsConsumer ElectronicsDeveloper

Microsoft is betting big on Windows 8. But will the immense promotional efforts the software giant is putting behind the latest Windows OS pay off?'s Rob Enderle handicaps the high-stakes game Redmond is playing.n

There isn’t a great deal of demand for Windows 8 at the moment, but then, this early in the cycle, new versions of Windows rarely garner much enthusiasm.

Among IT observers, there is a running pool as to when Windows 8 will be generally available, with entries ranging from the end of September this year to (for the most pessimistic) sometime next century. Enterprises typically wouldn’t be picking up Windows 8 in high volume until 2014 if this were a normal cycle, but we have this little trend called the Consumerization of IT, which could make the Windows 95 wave that broke over enterprises in that launch year seem trivial by comparison.

It is far too early to assess anything more than the potential this wave may create, so let’s look at where Windows 8 stands at present, and then set some milestones that it will need to pass to before we can determine whether the latest release will be anything that businesses need to consider this year.

No Windows 8 Wave This Year?

Some early indicators suggest that there may not be much of a wave this year. The Microsoft of 1995, which focused the entire company on the Windows 95 launch at the great expense of Office 95, no longer exists. While Microsoft is bigger and better-funded now, the launch effort will largely be driven by the Windows group, and Office appears to be on a different cycle. That group tended to hedge its bets with Windows Vista, which contributed to that offering’s lackluster launch.

Additionally, with Windows 8 Microsoft is showcasing the Metro interface, which was introduced with Windows Phone 7 and massively under marketed, helping to take the company’s market share from the 20 percent range to the low single digits. Now, while the interface may test as easier to navigate than either Google or iOS, and it is certainly newer, the limited marketing and hardware support have translated into chilly sales.

In short, instead of plowing the field for Windows 8, the lackluster embrace of Windows Phone 7 gives the impression that the market rejected this new interface, and that perception could have the same result as a real rejection. Meanwhile, competing offerings from Apple and Google have been strengthening significantly over the last few months, and once positions are taken, much as Windows Phone 7 demonstrated, getting people to invest in something new may be very difficult.

As an added drag, Windows 7 is still in deployment in companies, and users in the midst of learning one new product will likely resist learning another.

Windows 8 Media Blitz

Windows 8 is backed by what may be the strongest advertising team, led by Kathleen Hall, that Microsoft has fielded since Windows 95. In addition, the company is reported to have a launch and sustained advertising budget nearly three times that of the Windows 95 launch and the entire non-Apple PC industry, including Intel, which will field its own substantial marketing campaign. This product will span tablets, PCs and a new hybrid form similar to the Android-based Asus Transformer, which could be seen as a better choice than the combination of a tablet and a laptop when it launches.

In fact, given this will represent the first time that ARM and x86 have gone to battle in the same market, the competitive advertising spend between ARM and x86 vendors could become legendary in and of itself. What’s more, AMD is expected to release a unique architecture that will blend both technologies, a gamble that will require an unusually large promotional effort to pay off.

In short, the combined resources surrounding this launch could easily make even the massive Apple rollout budgets seem trivial and could easily eclipse any other product class in the critical fourth quarter. The product also will have some unique advantages, including a tighter coupling with Xbox and Kinect for expanded gaming and interface, Gaze, an iris tracking software for cursor placement that could bridge tablets and more traditional non-touch monitors and PCs, and an app store that could transform the application environment for Windows and present a more attractive alternative than either Apple or Google for existing Windows users.

The past success of Windows 95, iOS products, and even well-funded Android offerings like Droid and Samsung Galaxy has demonstrated that with enough marketing, and the right product, consumers will buy in large numbers.

Windows 8 Hits Beta and Other Milestones

The first milestone will come late next month when Windows 8 begins the beta cycle. If technology influencers and developers show early excitement around this product and general media reports it positively, this would indicate a building wave of momentum. If the event passes with little notice or with a lot of negative press, this first indicator would suggest a continued lack of demand for the offering.

The second milestone will likely come at RTM. Strong press coverage and support from company advocates of the product buzz surrounding attractive new hardware or new features could indicate strengthening demand. If coverage is negative or there appears to be muted interest, once again the demand wave won’t be there.

The final indicator will be launch. If there are significant pre-orders for hardware, software or both, we will likely have a consumer-driven wave. If people are excited about other things than Windows 8, then 2012 will not be the year for the product and Microsoft will have a serious problem, but you likely won’t have to worry about it.

Riding the IT Consumerization Wave

Now, if there isn’t a wave, then Windows 8 simply isn’t going to be a concern this year and you can focus on other things. On the other hand, the whole concept of consumerization of IT has employees driving technology into business, and if they get excited about Windows 8 you’ll need to be ready for it to come through the door, so long as you’ve already embraced this trend. Granted if you’re still defiant to IT consumerization, this will likely just be another chance for your users to be told “no,” but given how many you have, it may be wise to see if a wave is building and be ready in case it breaks.

Rob is president and principal analyst of the Enderle Group. Previously, he was the Senior Research Fellow for Forrester Research and the Giga Information Group. Prior to that he worked for IBM and held positions in Internal Audit, Competitive Analysis, Marketing, Finance, and Security. Currently, Rob writes on emerging technology, security, and Linux for a wide variety of publications and appears on national news TV shows that include CNBC, FOX, Bloomberg and NPR.