There's no denying that at the moment, Microsoft is in a tough spot. Worse still, it's in a tough spot thanks to more than one product or platform. For now, the company seems to be recovering well enough from the Xbox One debacle from last month, but things are a little more questionable on the Windows side.
While things could change in the future, the Windows RT platform has proven to be an absolute failure up to this point. Last week, Microsoft suffered a $900 million writedown on Surface RT; the company had expected to sell a lot more units, and personally, I'm not sure why. With the Windows world having revolved around x86 code for as long as it's existed, it seemed unlikely to me that a move to an ARM platform was going to prove successful. After all, Microsoft was in effect tossing the traditional Windows experience out the window with RT.
Unfortunately for Microsoft (and those who've purchased a Windows RT device), the number of apps even eight months after the OS' launch remains highly limited. Here's a good example of that: only now is Facebook preparing to release an app for the platform. Of all the companies out there, you'd think Facebook would be one of the first out of the gate with an app - given the company wants to be on everything.
I'm not a great analyst, but if I had to predict whether or not Windows RT will last, my answer would be a resounding "no". A couple of weeks ago, Microsoft shaved $150 off of its Surface RT pricing, placing its 32GB model at $350. At this price-point, it competes with one of the hottest tablets on the market, Apple's iPad mini, which sells for $429 for the 32GB model, or $329 if you can deal with only 16GB.
If Windows RT is to succeed in the end, the prices of the devices need to be more attractive. In reality, prices should have been where they are right now from the start. After all, Apple already had a proven platform; Microsoft was only starting out. Had Surface RT cost $350 last fall, I am very confident that more people would have been willing to take a chance, and Microsoft may have hit its overall sales targets. Better still: had that success happened, more app developers might have taken the platform more seriously. It would have been a win/win all-around.
That's Windows RT - what about Windows in general? Tablets are big business at the moment, but Windows tablets are not. Both Apple and Google dominate the market here, and generally speaking, most people don't use a tablet to use a full-blown OS. Instead, they expect a limited environment, a simpler one, where they can just fiddle around with apps, get some things done but over all just "consume" rather than create. A notebook, with greater performance, is much more ideal for a proper desktop OS experience.
Given that, it makes sense to believe that Windows RT was a good idea. If Apple and Google are offering limited-function OSes for mobile platforms, then why not release a Windows OS with the same goals? Microsoft did do that, so what's the problem? Execution, plain and simple. Microsoft released a new platform, confused consumers about what it was, and then priced it too high. The company might have been able to get away with this years ago, but when Android and iOS are so well-refined at this point, and have massive app marketplaces to boot, it's easy to see why Microsoft had so little success with Windows RT up to this point.
In our look at Windows 8.1, posted earlier this month, I talked about an obvious issue with Windows 8 at the moment:
"What Windows 8 really needs now to succeed is improved developer support. The Store for Windows 8-specific apps is still littered with middling and sub-par apps, and that's not a great thing. Things are undoubtedly improving, but I do feel that some developers are doing little to help the OS. Instead, it seems like some developers just rush an app out the door, just to put something in the store, and then forget about it. That's hardly a healthy thing to occur when Microsoft's greatest interest is developing a rich ecosystem a la Google's Play Store or Apple's App Store. Hopefully, these improvements will happen sooner rather than later."
If Windows 8 is lacking apps (as in, those used through the Modern UI), then that should explain just how bad the situation is with Windows in general. Microsoft hasn't effectively sold the masses on Windows 8, and while it's improving things with 8.1, it's hard to say if that's going to be enough.
Microsoft needs to take a hard look at things, and (ideally) begin listening to its customers. When your customers are not happy, that's a problem, and bad business. Years ago, the company could have easily gotten away with some of its recent moves, but with the unbelievable competition that exists today, the company has to learn how to better cater to the market and consumer sentiment.
We learned a couple of weeks ago about about some major restructuring going on within the company, so maybe this is the point-in-time when things could start to turn-around. Windows is hardly dead by any stretch, but it's clear that it's going to be dwarfed by competing platforms sooner than later if Microsoft doesn't successfully change the course it's been traveling on for a while.