Posted on April 11, 2013, Ross Lincoln 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.