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Oprah Winfrey too late to save Microsoft's Windows 8

Signs are that Redmond has produced a turkey this Xmas

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Early signs are showing that hopes for the overnight success of Microsoft's Windows 8 are unrealistic, although the tech giant appears to have bet the farm on the brand new operating system with the shiny new interface.

Microsoft blogger Paul Thurrott has quoted one unnamed company source as saying early sales of Windows 8 PCs are disappointing and below expectations.

Thurrott doesn't provide details, but his source's comments add to a growing weight of evidence suggesting the Windows 8 launch hasn't gone as expected for the world's largest software maker.

The Microsoftie simply confirms what we're seeing as an emerging pattern of lackluster sales.

The question is: is this because of unrealistic expectations set by Microsoft, the dynamics of an ailing PC market, the deeper problems of supply and demand, or did Microsoft just get things wrong?

Certainly, Microsoft has been guilty of setting unrealistic expectations on new versions of Windows over the years. On Windows Vista, Microsoft left channel partners with stacks of unsold inventory as it hyped the operating system's capabilities and potential sales.

Before that, on Windows XP, Microsoft seemed to think all that was needed to refloat lack-lustre PC sales in the early 2000s was its brand new operating system.

Microsoft was wrong on both counts. And, it seems, Microsoft is wrong again, having succumbed to its own hype that Windows 8 is the biggest thing since Windows 95 and should therefore sell by virtue of its own innate brilliance.

Assuming those consumers targeted by Microsoft for Windows 8 were catalysts for change, and those catalysts did not set off the required reactions, it would suggest another problem is to blame.

You could argue what's behind poor sales are problems of supply and demand - that there are not enough machines being produced by PC makers and sold through the channel.

Certainly, in the UK, distributors have said they aren't being given enough PCs to sell. Most PC makers are expected to unveil their machines at January's CES. That will coincide with the launch of Microsoft's Intel-based Windows 8 Pro Surface tablet.

Tellingly, according to Thurrott, Microsoft has pointed the finger of blame at PC makers for not building enough Windows 8 machines this side of Christmas and for lacklustre designs.

What about the third option: that Microsoft got it fundamentally wrong on Windows 8 and Metro? It would seem demand does exist, so Microsoft hasn't manufactured a turkey.

According to channel analyst Context, sales of Windows 8 machines in the UK have so far helped drive up demand for units. Also, sellers of Microsoft's first own-branded Windows 8 machine - Surface running Windows RT for ARM - have experienced shortages.

But it's a question of scale, and whether expectations were initially set too high - either deliberately by Microsoft's sales managers or using the soft power of PR and gadget-happy news sites and bloggers hungry for something to finally stick to the smugs of Cupertino. This would seem to be the real problem.

Online tech retailer NewEgg yesterday described sales of Windows 8 as "slow going", but didn't provide figures. Merle McIntosh, senior vice president of NewEgg product management, said NewEgg had hoped for an "explosion" of Windows 8 sales following its 26 October launch. Who was to blame for setting this kind of unrealistic expectation?

According to Context, more grounded resellers at this stage simply want product information and "seeding units"; in other words, they are treading carefully and don't want to a repeat of Windows Vista, where they stock up ahead of a demand that never materialises.

By Microsoft's own admission, and despite its attempts to square the circle after the fact, even sales of Surface have been modest: for all the reports of sell-out sales in the US and UK, you're only getting half of the story: we don't know how many units were actually manufactured in the first place to be able to judge whether those early sell-out sales should be judged impressive.

Meanwhile, according to Microsofties posting to the Mini Microsoft blog, those lines of people queuing up to buy Windows 8 and early Surface machines outside Microsoft's stores in Seattle and Bellevue included Microsoft employees, skewing perceptions of early popularity.

It's still early days for Windows 8 and Surface. The proof will be in the long-term adoption, how far Windows 8 PCs are received in a sagging PC market and whether Surface can tear a chunk out of the sales growth Apple has experienced on tablets with the iPad. Already, according to Forrester, equal numbers of consumers want a Windows 8 tablet as those who want an iOS machine.

Microsoft has enlisted the star-pulling power of housewives' TV favourite Oprah Winfrey to endorse Windows 8. The TV presenter, regarded as the most powerful woman in the US, has placed Surface on her influential product placement "favorite things" list for 2012. Last time Microsoft broke out Winfrey, it tried - and failed - to get her endorsement for Windows Vista.

Sadly for Microsoft, it looks like a shameless Oprah's plug has come too late and Redmond has lost Q4. This is traditionally the strongest sales period for any PC, software or game maker, and the period Microsoft was no doubt hoping to exploit by timing its Windows 8 and Windows RT Surface launches for October.

With PC makers holding back for CES in January, and with Intel-based Surfaces coming next year, all eyes will now be on the full year's results for 2013. ®

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