Is Windows 7 the Last Microsoft PC OS?

The Technology Review has an interesting guest blog post by Robert X. Cringely on the future outlook for Microsoft’s operating system business.  Cringely has been covering the PC business, as a journalist and author, for many years; he wrote a regular column for InfoWorld magazine, wrote and hosted several PBS documentaries on technology, and is the author of the book, Accidental Empires: How the Boys of Silicon Valley Make Their Millions, Battle Foreign Competition, and Still Can’t Get a Date.  I’ve read his work since the late 1990s, and have always found his ideas thought-provoking, though I have not always agreed with them.

His latest idea, expressed in this essay, is that Windows 7 may be the last “traditional” PC operating system that Microsoft releases.  The reason is simple: there is basically no more growth in the traditional desktop PC market in the developed world.

Microsoft, the largest and richest software company in the world, has to play catch-up in the exploding mobile device market presently dominated by Google’s Android operating system and Apple’s iOS for iPhones and iPads.  …  PC sales in the developed world are declining while smart phone and tablet computer sales—particularly for Apple—have been exploding.

As Cringely points out, although Microsoft has sold some 350 million Windows 7 licenses since the system was introduced, most of these have been  for replacement PCs, not for new users.  Microsoft’s smartphone operating system, Windows Phone 7 , has not been a huge success in the market.

Windows Phone 7, Microsoft’s current mobile operating system, ranked a dismal fifth at the end of 2010, with 4.7 percent market share, according to the research firm Gartner.

Windows Phone 7 has also had a number of  problems in handling software updates since earlier this year

Based on hints he has gleaned from two leaked alpha versions of Windows 8 code (as it is being called in the absence of a formal name from Microsoft), Cringely thinks that Microsoft will try to make that next version of Windows one that will work across a wide range of devices, from traditional desktop PCs. to smartphones, tablets, and other mobile gadgets.  Microsoft has also entered into an alliance with Nokia, the Finnish mobile phone manufacturer, to supply Windows operating systems for Nokia’s phones, replacing the Symbian system originally developed by Nokia.  Nokia has been losing market share, and Microsoft’s effort to buy market share via an exclusive deal, though consistent with its past practice in the PC market, may not work.

Microsoft, in turn, is accepting financial responsibility for Nokia’s software development, buying what it hopes will be big market share in the process. To be a major player in the mobile transition, Microsoft has to be the number one or two player rather than a distant fifth.

I have written here a couple of times before about some of the problems that Microsoft has had in the mobile device market, even though they have been trying to promote tablet computers for years.   Though they have not advertised the fact, for obvious reasons, Microsoft has been trying to “slim down” Windows for several years, with mixed results.  This is a critical issue in the mobile device market, where modest hardware requirements and battery life are of great importance.    There is also some question about the suitability of the Windows GUI interface to a mobile device.

Technology transitions are always a time of opportunity for new market players, and a time of risk for established firms.  It will be interesting to see how this all unfolds.

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