As you all may know, Windows was one of the most profitable products of Microsoft for more than thirty years and the software industry giant is now playing its future with the new operating system Windows 8 which is completely redesigned.
Without any drastic design change since 1995 till present, Win OS has been a continuous source of huge profits for Microsoft. Just last year, Windows had sales worth $18 billion and profits of $11.5 billion. Taken separately, Windows featured enough resources to enter top 100 U.S. corporations by revenue and its profit margin is among the highest in the world.
But things start to not look so good. PC sales slowed down and Windows turnover declined for two years in a row, Microsoft missing the start of the race for tablets.
Only a few years ago, Windows was the OS installed on about 90 percent of world’s computers connected to Internet, according to Net Applications. Now, the boom of smartphones and tablets made Microsoft’s market share fell to two-thirds.
Only Apple has sold 100 million iPad tablets in 2 1/2 years. Company’s boss Tim Cook said that in the second quarter of 2012, Apple sold more iPads than all world’s PCs.
Thus, Microsoft had only two choices: either a radical change or a slowly death.
Microsoft obviously opted for the first option and created Windows 8, an operating system that specifically targets the touchscreen devices, but works on any PC. “It is an absolutely essential product,” said Bill Gates on a video blog.
Perhaps most challenging process was Windows platform opening for other devices based on ARM processors which power about 95 percent of world’s tablets, smartphones and other mobile devices.
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Windows 8 impact on users!
However, there is a problem: users acceptance. According to many analysts, users will be slightly scared and misled by the completely different look of the new Windows OS.
The familiar Start Menu has been replaced by “bricks”, huge icons and all programs are displayed directly on the desktop. Though not difficult to use, customers will need to learn new functions.
There is another important novelty: Windows 8 allows installation of applications which users can buy and download only from Windows Store, in a pretty similar manner as iPad users who need to grab their apps from the App Store. Until now, Microsoft ignored this market which brought huge profits to Apple as well as Google – the store dedicated to Android system.
“This is Microsoft’s response to the pressure of competition, which led the company to rethink not only products’ look but also their architecture,” said Gartner’s analyst Michael Silver.
The change could be lucrative. Apple and Google take each 30% of the profit from every application sold for their devices. Microsoft currently receives nothing. But now, if Adobe, for example, wants to make a Photoshop app for Windows 8, it will have to sell it through Windows Store.
For Microsoft, this is a completely different approach to the business model. But if application developers will not show interest in producing Windows apps, then Microsoft will be at risk.
