By now you should've heard that PC sales haven't exactly been booming. In the first quarter, IDC estimated that PC shipments fell 13.9% year over year, marking the worst quarterly decline ever for the PC industry. Between tablets that are cannibalizing the low-end notebook and the lackluster reaction to Microsoft's (NASDAQ: MSFT ) Windows 8, it's not surprising to hear that the PC has seen better days. Despite Microsoft's efforts to expand its reach in mobile, the health of the PC industry remains central to the company's overall profitability and growth prospects.
With Windows 8, Microsoft attempted to reorient the PC experience to embrace an increasingly mobile and touch-friendly world. However, the sales pace of Windows 8 hasn't exactly been stellar. Thus far, Windows 8 is shaping up to be one of Microsoft's biggest flops, surpassing Windows Vista in the process. In other words, Microsoft needs to find a way to reverse the trend and get users to wholeheartedly embrace the modernized Windows experience.
Here's how Microsoft could prevent Windows 8 from being an epic failure.
Kill Windows RT
Windows RT has been a nightmare since the beginning. It has utterly confused consumers since there are inherent differences between the full version of Windows 8 and Windows RT. For one, Windows RT devices are powered by ARM Holdings (NASDAQ: ARMH ) designs, which to the consumer means that legacy Windows applications are not compatible. However, devices powered by ARM offer the promise of smaller form factors and improved battery life over Intel (NASDAQ: INTC ) -powered designs.
Microsoft has done a poor job relaying these and other subtleties between Windows 8 and Windows RT to consumers. The Verge investigated the topic and found that Microsoft failed to properly educate its employees, which naturally damaged consumer perceptions about the product. As a result of this confusion, Samsung decided not to launch any Windows RT devices in the U.S. and stopped RT sales in Germany. Acer has delayed introducing any Windows RT devices in the U.S. until it had a better sense of how Microsoft Surface RT sales fared. When major OEM partners don't even want to embrace Windows RT, how can Microsoft really make it a success story?
If only Microsoft would have just stuck with Intel's x86 architecture the whole time ...
Introduce a $200 Windows 8 tablet
Not only would a $200 Windows 8-powered tablet do wonders for Microsoft's mobile prospects, but it would also probably give Apple (NASDAQ: AAPL ) and Google (NASDAQ: GOOG ) a run for their money in the tablet space. Both Apple's and Google's tablet experience lack the level of productivity that that would be possible on a Windows 8 tablet powered by Intel's upcoming Bay Trail processor. With a few added peripherals, such a device could become an impromptu, yet highly capable, PC in a pinch.
Speaking of Bay Trail, the future of the PC also hinges on Intel's ability to introduce technology that enables a compelling computing experience and form factor. Bay Trail-powered devices aren't expected to hit the shelves until the holiday season this year, but when they do, I expect the prospect of a $200 Windows 8 tablet to be within striking distance.
Bring back the Start menu
Perhaps the biggest gripe users have with Windows 8 is that the Start menu no longer exists after a 17-year run on the Windows ecosystem. When something's been around longer than most teenagers, it's only natural for users to associate the Windows experience with the Start menu. Take that experience away, and it's easy to see why millions yearn for the past.
Still, this outcry hasn't been enough for Microsoft to break down and give users exactly what they want. According to The Verge, Microsoft's upcoming Windows version 8.1 will be splitting the difference with users by giving them a Start button that routes back to the "Metro" interface. In other words, users still demanding a familiar Start menu experience will be sorely disappointed.
Above all else
Windows 8 isn't necessarily a terrible operating system, as sales would suggest. It's merely a strong divergence from previous Windows versions. To compensate, Microsoft needs to properly educate the public by improving the marketing message surrounding Windows 8. In short, Microsoft should better explain what makes Windows 8 different, why it's better, and how users can benefit from it.
If Microsoft can improve Windows 8's marketing message, consumer confusion is likely to take a back seat to improved reception.
It's been a frustrating path for Microsoft investors, who've watched the company fail to capitalize on the incredible growth in mobile over the past decade. However, with the release of its own tablet, along with the widely anticipated Windows 8 operating system, the company is looking to make a splash in this booming market. In this brand-new premium report on Microsoft, our analyst explains that while the opportunity is huge, the challenges are many. He's also providing regular updates as key events occur, so make sure to claim a copy of this report now by clicking here.