Win 8′s Drag On PC Sales An Object Lesson For Microsoft

In what should be an important lesson for Microsoft as the company prepares to unveil the next Xbox console, an analysis of PC sales by research firm IDC shows that the launch of Windows 8 has significantly hurt PC sales.

As detailed in a statement released yesterday, in Q1 2013 total worldwide shipments of PCs were 76.3 million. This represents a 13.3% decline over the same quarter in 2012, and is far in excess of the projected 7% decline. This marks the sharpest decline since 1994, IDC says, and while the popularity of tablets and other mobile devices was a factor, IDC singles out Windows 8 as the primary culprit.

IDC Clients and Displays Program Vice President Bob O’Donnell spelled it out. “At this point,” he said in the statement, “unfortunately, it seems clear that the Windows 8 launch not only didn’t provide a positive boost to the PC market, it’s actually hurt the market. While some consumers appreciate the new form factors and touch capabilities of Windows 8, the radical changes to the UI, removal of the familiar Start button, and the costs associated with touch have made PCs a less attractive alternative to dedicated tablets and other competitive devices. Microsoft will have to make some very tough decisions moving forward if it wants to help reinvigorate the PC market.”

This result doesn’t, or at least shouldn’t come as a surprise. Early reception to Windows 8 has been widely negative, with video game developers showing particular malice for the new operating system. Valve Managing Director Gabe Newell called it “a catastrophe for everyone in the PC space,” a sentiment seconded by Blizzard CCO Rob Pardo. Croteam CTO Alen Ladavac went even further, warning that with the new OS, Microsoft has “forbidden modding. They could very well forbid Open Source if they want.” And Mojang founder Markus “Notch” Persson believed Windows 8 would “ruin PC as an open platform.”

These blunt assessments from professionals who anticipated developing for the new OS were mirrored by beta users, many of whom praised the tablet-like experience but complained that the traditional desktop experience was adversely affected by the sweeping changes built into Windows 8. No matter though; Microsoft released the Operating System it intended to regardless of developer and customer feedback, a risk that has apparently failed dramatically to pay off.

While it seems just another example of the volatile nature of a PC market already squeezed by easy and affordable alternatives to the traditional desktop computer, this report comes just as Microsoft is set to unveil another major endeavor, the hotly anticipated next generation Xbox console. Last week, rumors that the new Xbox will require a persistent Internet connection in order to play games caused a spectacular PR cock-up for the company. Intense criticism of the rumored ‘feature’ from all corners of the gaming community prompted Adam Orth, creative Director of Microsoft Studios, to rudely mock those critics in terms that were strangely personal and deeply hostile. That behavior cost Orth his job, but it should be noted that while Microsoft distanced itself from his unprofessional tone, it refused to comment one way or the other on the rumors themselves.

That doesn’t mean the rumors are true; in fact, rumors have emerged this morning that the new console won’t include such a feature. But if they are – frankly, these competing rumors feel more like guerilla market research than bad information – this would mark the second time in less than a year that Microsoft launches a new product with hugely unpopular features despite being fully aware of just how unpopular those features are.

The negative effect Windows 8 has had on the PC Market should terrify the company. It remains the world’s largest software maker, but Windows sales have been slightly declining since 2011. (The reasons are unclear, and it might be because people are happy with Windows 7.) This shocking drop in PC sales caused by Windows 8 should serve as proof that the company’s near-monopoly on computer users is quickly becoming past-tense, and that the company cannot afford to assume its customers will simply take what they’re given for much longer.

We’ve already explained why an Xbox console which requires persistent Internet to function is an insane idea, but today’s news should serve as a warning to Microsoft; insane or not, if you release a product you know for a fact people don’t want, you will probably suffer for it.

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10 Comments on Win 8′s Drag On PC Sales An Object Lesson For Microsoft

gasmaskangel

On April 11, 2013 at 9:59 am

“today’s news should serve as a warning to Microsoft; insane or not, if you release a product you know for a fact people don’t want, you will probably suffer for it.”

Why is it that so many companies today seem to fail to realize this? *cough* EA *cough cough*

pooleboy87

On April 11, 2013 at 11:46 am

Unfortunately it sounds like, regardless of whether or not the CONSOLE makers decide to engage “always on” connectivity requirements, certain publishers may try to ram such “features” down our throats anyways.

Goner

On April 11, 2013 at 3:58 pm

The truth is that with a good marketing who can sell almost everything, it’s just a hype matter.
Cell phone were big and it was cool to have one and here come little cell phone and then it became a shame to have the first one and now who really care about the size of the i phone?huh.
And it’s maybe why they had just try to disguise Windows 8 in a tactile screen URGGG!!!What a crap, every little thing on a button( and not on a tactile screen) , i hate so, to be assisted, forget it…caveman here .
They said ” Geek is chic”
And i thought “Deep ”
But this is the way things goes now.

Air Jimma

On April 11, 2013 at 7:47 pm

I understand that since Win 7 has been so well received they needed to try and do something innovative to give people a reason to upgrade. The Metro UI is fine and dandy on tablets and phones where it belongs, but I can’t figure out why they forced a UI made for touchscreens on keyboard and mouse desktops.

They can’t have thought that the touchscreen desktop was actually going to take off. The only people I’ve come across with the touch desktops are older folks who don’t know any better and buy whatever the BestBuy guy tells them to.

quicktooth

On April 11, 2013 at 8:17 pm

At f|_|cking last. This is what is SUPPOSED to happen to sh!tty products- they SELL LESS than good ones (or at least less in general). Maybe THAT’S the problem with the economy- YOU ID!OTS BUYING SH!TTY THINGS FROM PEOPLE WHO INSULT YOU. How any of you thought that would be a good idea is beyond my sane ability to understand. OF COURSE they’d take advantage of you. OF COURSE they’d try doing less and less and worse and worse. HOW IS IT POSSIBLE YOU’D AGREE TO ALL THAT. Maybe people are beginning to wake up. Baa baa @ssholes.

JawaEsteban

On April 11, 2013 at 11:06 pm

Not understanding basic demographics strikes again. Seriously, what the f is going on lately? Did the majority of competent marketing employees get let go during the recession and companies replaced them with interns? This just keeps happening, company after company, industry after industry, massive flameouts of products that a friggin’ chimp could have figured out were not what customers wanted.

In this case, the morons apparently brainlocked on the fact the the overwhelming majority consumer of windows PC’s is corporate. Corporate is not about to go out and spend who knows how much money switching every workstation over to touchscreen. So, that’s a loss of the majority of potential sales right out of the gate.

The much smaller home user/personal user market is all that’s left, and the majority there still has a lot less disposable income now thanks to, again, the recession. They’re not buying touchscreen systems to replace perfectly good desktop computers, especially since the things are still priced like they’re made from endagered whale tusk and unicorn glitter. That leaves laptops, which is the ONE area of traditional hardware that is taking the hardest hit from tablets. Tablets are killing laptops, and the clear winners in that market are the ipad and kindle variations.

So basically, the only market segment that M$ had a prayer of getting solid adoption of W8 in is the same market segment that is already the most completely lost to competitors. Teh stupidz just make your head hurt after a while. Who the f thought this was a good idea, and why in the name of batman’s jockstrap are these helmet-wearing window lickers still employed?

max

On April 12, 2013 at 6:21 pm

they never listen to ing customers, they should learn that its thx to the customers they exist in the 1st place, when will we go back to the old days where producers were trying to make customers happy ?

Swcloud99

On April 13, 2013 at 8:07 am

Jawaesteban not getting comment of the week shows there’s no justice in this world.

Foehunter82

On April 15, 2013 at 11:34 pm

*Is greatful no one has turned their attention to his monopoly on unicorn glitter.*

lol

On April 17, 2013 at 5:40 pm

No nobody is gonna buy a 1500 dollar Dell computer when you can build one for a quarter of the price.