Windows 8 Faces Uneven Sales Takeup, Warns Analyst

Microsoft’s fightback against the tablet juggernaut with its forthcoming Windows 8 operating system promises to be a bumpy ride.

A check with Microsoft’s supply chain partners in Asia indicates that the production of Windows 8-based devices will briefly surge this Autumn before tapering off, with sustained high volume production unlikely to kick in until the second half of 2013, according to industry analysts.

Cautious Adoption

Cautious adoption of Windows 8 by businesses is the likely reason for the gradual adoption rate, these analysts say.

Topeka Capital analyst Brian White wrote a research report based on interviews with Microsoft suppliers and titled it “Windows 8 Expectations Plummet,” according to a report by Business Insider.

The report states that production is strong this month and should remain so through November, as Microsoft and other OEMs roll out new devices, primarily tablet computers, running Windows 8. Microsoft revealed pricing on 16 October for its own Surface tablet computer, starting at $499 (£309) and the advertising blitz for the tablet is now in full swing.

But White says suppliers tell him production will slow down in December and that one of his contacts “does not expect Windows 8 [sales] to be material until the second-half of 2013.”

Such a forecast is consistent with numbers from Gartner Research, which anticipates sales of tablet computers running Windows to reach 3.8 million units by the end of 2012, but could reach close to 21 million units in 2013. That will make it a distant third to industry tablet leaders Apple and the various OEMs making tablets that run Google Android. Their 2013 sales are forecast at 73 million and 67.7 million, respectively.

The initial run of 2012 Surface sales will be the models running Windows RT, the version of the OS for devices equipped with ARM processors, and those mostly will be sold to consumers, said Carolina Milanesi, a research vice president and lead tablet analyst at Gartner. Enterprises will likely pass on buying Windows RT devices and wait for the Windows Pro 8 version for x86-based processor devices.

“I think they are going to sit this one out and wait for the x86 version and get the full compatibility on the desktop side,” Milanesi said.

Legacy Windows XP

Enterprise adoption of Windows 8 is also hampered by the fact that some of them are still converting to Windows 7 from XP, added Charles King, principal analyst at Pund-IT Research.

King agrees that the fall surge in Windows 8 device production is likely driven by consumer sales and the approaching holiday season while the sales forecasts for the second half of 2013 will be driven by back-to-school sales for consumers and the expected PC refresh cycles for businesses. Weighing down on all of these factors, he adds, is the continuing weak global economic environment.

However, as demand builds for Windows 8 devices – either RT or 8 Pro – enterprises will soon be forced to support two Windows operating systems in the workplace, said Gartner’s Milanesi.

Like it or not, employees are expected to start showing up at work with their own Windows RT-based tablets – not to mention Apple and Android tablets – and expecting to get on the corporate network to do their jobs, she said.

Other Gartner colleagues, who deal more directly with enterprises than Milanesi does, are advising their clients to accommodate Windows 8 tablets before worrying about Windows Pro 8 desktops.

“They are telling them to hold off on Windows 8 deployment from the PC perspective,” Milanesi said. “And because the users within the enterprises want a tablet, Windows 8 will be that solution that will get them what they want and at the same time the IT department will be able to manage [the desktop environment].”

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Originally published on eWeek.