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Study Doubts Windows 8's Ability to Reverse Market Slide

Forrester sees PC dominance continuing, but is skeptical of its chances in the mobile device market.

Windows 8, Microsoft's first product aimed at the touch-centric tablet market, is officially released on Friday. It's the company's most important product release in many years.

But will it stop the bleeding inflicted by companies like Apple and Google, that are far ahead of Microsoft in the mobile device space? A new report from Forrester Research is skeptical.

The unraveling of that market share has been five years in the making, according to the report, "Windows: The Next Five Years." The report pulled together data from IT purchases in 62 countries, finding that the Windows market share has been shrinking as the mobile device market takes off over the PC market. In estimating overall personal computing device sales by OS, Forrester found that Windows once held an overwhelming lead in 2008 with about 70 percent of the OS market. By 2012, that market share had shrunk to about 30 percent, according to the analyst and consulting firm.

Moreover, Windows 8's arrival this week, at best, will simply begin to hold the line on Microsoft's shrinking personal device OS market share, according to a blog post by Frank Gillett, a Forrester analyst and principal author of the report.

"Windows 8 will simply stop the shrinking, maintaining Microsoft's share at about 30% through 2016," Gillett wrote in the blog post. "By 2016, we believe that Microsoft will have about 27% of tablet unit sales, but only about 14% of smartphone sales (and some of us are very skeptical they'll even get to 14%)."

Windows 8, which has a touch-based user interface that looks a lot like the mobile phone interface of Microsoft's Windows Phone OS, will arrive on multiple form factors, from traditional PCs to laptops and new ultrabooks, as well as tablet devices. Microsoft also will roll out its own Surface "PC tablet" device on October 26, although just the Windows RT devices will be available on that date. Microsoft last week opened up preordering for the Surface Windows RT devices, with stocks of the lower priced model reportedly now on back order. The x86-based Surface devices are expected to be available 90 days after the October 26 launch.

The new Forrester report sees Microsoft still dominating in the PC market in the near future. However, Apple's iPads have the lead in the tablet market. The smartphone category is led by Google's Android mobile OS, according to Forrester. Microsoft is now seen by Forrester as a "contender" in the personal computing device OS market, rather than a leader.

On the applications side, Forrester sees a platform store war forming that will bring huge benefits to the dominant hub owners such as Apple and Google, followed by contenders such as Microsoft, Amazon and Facebook, according to a blog post by Forrester CEO George Colony. Apple currently leads with a store that hosts 700,000 apps, followed by Google with 675,000 apps. (The Microsoft store app count wasn't mentioned in the blog post, but veteran Microsoft reporter Mary Jo Foley found an estimate of 450 Metro-style apps in the Windows Store, with another source estimating 1,004 apps.)

Colony, who was offering up advice to corporate CEOs in his blog post, suggested that CEOs should push IT to support Apple and Google platforms.

"So it's obvious what you do if you're a CEO: You push your techies to support the Apple ecosystem -- now," Colony wrote. "Next, you get ready to support a second ecosystem -- most likely Google. Then, you wait -- for 12 to 18 months -- to see if a third ecosystem from Microsoft, Facebook, or Amazon can get traction."

About the Author

Kurt Mackie is senior news producer for 1105 Media's Converge360 group.

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