Original URL: http://www.theregister.co.uk/2013/05/08/microsoft_coke_moment_windows_8/

Coke? Windows 8 is Microsoft's 'Vista moment'. Again

PCs built for people not designed by data

By Gavin Clarke

Posted in Applications, 8th May 2013 08:31 GMT

Microsoft has decided to backtrack on Windows 8 and loosen the Metro straitjacket the new OS applies to the traditional desktop.

This U-turn is being described by commentators as Microsoft’s ""New Coke Moment" – where a business drops a brand-new flavour and reverts to the trusted and loved old recipe following a backlash from angry consumers. But your correspondent would argue it should really be described as a "Vista moment".

What's a "Vista moment", you say? It describes the point in time when a top Redmond exec publicly admits things aren’t quite as rosy with a brand new Windows operating system as they’d originally advertised.

It is from this point onwards when those MS troops - who’d previously chalked up reports of problems in the new Windows to the evil doings of the media and people who didn’t “get it” - suddenly find it acceptable to talk about the problems.

This time it’s the Windows group’s Tami Reller who has fired the starting pistol for Microsofties to pile onto Windows 8. She's done so in a set of coordinated meetings with a select number press used to deliver the official message. Reller told the Financial Times that "key aspects” of Windows 8 will be changed.

In a separate chat with Mary-Jo Foley, Reller said the supposed update to Windows 8, part of a raft of changes codenamed "Blue", will “address customer feedback” received on Windows 8 and Windows RT.

The word will now start fanning out across Microsoft: it’s OK to trash Windows 8. Watch out for a change in the wind coming from Redmond as others talk about Windows 8 in terms of "challenges", "lesson learned", and "new opportunities".

The last time this happened was in February 2007, a month after Windows Vista’s official launch, and it was chief executive Steve Ballmer who fired the starting pistol on the great Windows Vista flagellation.

Ballmer hinted something was off on Windows Vista when he chided analysts for being "overly aggressive" in estimating the effect Microsoft and Windows Vista could have on PC sales.

He said there was a "disconnect between what people think is the growth of the PC market and what they think is Vista growth." He told the analysts' call: "[P]eople have to understand our revenue models because I think some of the revenue forecasts I've seen out there for Windows Vista in fiscal year '08 are overly aggressive."

Partner pile-on

In the months after Ballmer's comments, other Microsofties copped to discovering application and hardware compatibility problems as well as hard drive- and chip-gobbling performance issues in a piece of software that Ballmer’s buddy Bill Gates had introduced in 2003 as the "next wave of software innovation".

The Vista pile-on gathered steam at the company’s massive annual Worldwide Partners’ Conference (WPC) in Denver, Colorado, that year, where your correspondent witnessed Microsoft's chief operating officer, Kevin Turner, joined the great denunciation to admit compatibility problems where problems and not just mere "rumors." Others, meanwhile, confessed to how – while they were selling Windows Vista to us - they’d been taking a beating in customer meetings. By 2008, Microsoft's marketing people were sticking it to Windows Vista with as much passion as they'd once sold it. "We broke a lot of things. We know that, and we know it caused you a lot of pain," ex vice president of Windows Vista consumer marketing Brad Brooks told WPC in 2008 as he marched in step.

But Windows 8 has fared better than Windows Vista. So why speak out now after six months of insisting everything was fine and there was nothing to see?

Talk to Microsofties before today and they’d literally repeat the official line that Windows 8 and its tabletised sibling Surface “just worked”. Microsoft – plus its supporters in the blogosphere – steam-rollered over any and all criticisms of Windows 8 and its Metro UI - which dumped the classic desktop and familiar Start button for working in a world of squares - saying all that was needed was a dash of mass user re-education.

Microsoft blamed low sales of Windows 8 on the PC makers, which it claimed had not been building the “right kind” of devices to appeal to a touch-hungry public. It reckoned OEMs weren’t turning out enough PCs, tabs and hybrids with fast enough processors, big enough memory or the necessary graphics acceleration.

Now that’s over. From now on, you can expect those same Microsoft types who'd reckoned Windows 8 "just worked" to now tell us in all seriousness how Microsoft's working with partners and taking feedback to overcome challenges and deliver a compelling "user experience".

The person chosen for the big reveal is significant: Reller is effectively the Windows group’s business head, the person in charge of marketing and finance. Reller was there when overall group chief Steven Sinofsky was in charge and she remained after he abruptly left in November 2012. So Microsoft’s messenger is a serious exec who knows the Windows business.

Now that Sinofsky's gone...

With Sinofsky out the door, it’s easier for Microsoft to move on. Sinofsky was the principle architect and chief steward of Windows 8. He ran the Windows Group with streamlined efficiency, absolute control and total secrecy.

Sources tell us that such was the degree of control exercised by Sinofsky that when members of Microsoft's Windows group met partners and there were other Microsofties present, the non-Windows groupers were ordered out of the room. Even PC partners knew little of Windows 8’s capabilities during development. Yet, they were expected to love Windows 8 so much they’d fight to the death in a bid to build beefier competing machines with no actual evidence they’d sell.

But the former Windows chief's problem - which ultimately became Microsoft and Windows 8's problem, was that he emphasised process over people. He built a version of Windows based on data and theory without actually understanding how people used Windows. It was no wonder people got confused and we have arrived at where we are today.

The Sinofsky way placed complete and total faith in telemetry data culled from how users interacted with Windows to build a "perfect" version of Windows that bore no resemblance to reality.

In his "Building Windows 8" blog, here, the former Windows Division president justified a complete reworking of the familiar Start menu. Its deletion was based on stats that showed 67 per cent of all searches in Windows 7 were to find launch programs, 22 per cent were for files and 9 per cent for items on the Control Panel. He saw the data and concluded overhauling the Start menu would somehow make things better.

All you had to do was educate people on the new user interface. He failed to realize removing it would leave people rudderless without their principal means of using Windows. It is little wonder that the re-worked Start menu is making a comeback in Windows Blue, aka Windows 8.1.

With Sinofsky still at the helm preaching telemetics, change would have been impossible. Interestingly, Reller emphasises pragmatism is the new word at Microsoft, saying the company is not being “stubborn" and is modifying Windows 8 based on the feedback. That's feedback from people, not data.

Sinofsky has been gone six months, though, so why speak now?

The reason is that the gap between what Microsoft wants and what’s happening in the real world on Windows 8 is growing ever wider. Reller reckoned 100 million Windows 8 licences have been sold in the six months since launch. The good news? That’s the same as Windows 7. The bad news? It’s the same as Windows 7.

Microsoft blogger Paul Thurrot does the numbers and they show two key things. First, average monthly licence sales have dropped by a whopping three million units in the last three months, to 13.3 million. By contrast, in the three months after launch, 16.7 million Win 8 licences were being sold every month. Thurrot attributes this effect to an initial three-month launch bump, during which cheapie temporary upgrade offers were taken up.

Those numbers aren't just users, they're tech channel firms

Also, Windows 8 wasn't supposed to simply match the numbers of Windows 7, it was supposed to address a bigger opportunity than just PCs: it was supposed to cover PCs, hybrid PCs and tablets and any other touchable Windows device.

Thurrot says: “This figure should be considered a minimum for Windows 8 to be successful. Arguably, it should be much higher, especially considering the growth rate in the tablet market in particular. 16.7 million per month, let alone 13.3 million, just isn’t cutting it."

But, there’s an even bigger problem: these numbers don’t even reflect what’s been sold. Microsoft’s "licences sold" numbers include copies of Windows sold to PC makers, so they tell us what the channel has been willing to buy or what volume customers have swallowed rather than what’s actually being deployed on new machines.

If you look at what's actually ending up in the hands of end users, then things are far worse: the first three months of 2013 was the worst quarter for sales of PCs since analyst IDC started tracking shipments in 1994. Sales fell twice what IDC expected to 13.9 per cent, and IDC blamed Windows 8.

Microsoft's Windows-powered RT and Pro tablets, meanwhile, have also flopped: just 900,000 RT and Pro tablets shipped in the first quarter, according to estimates. In total, 49.2 million devices sold globally in a market that grew 142.4 per cent.

"While some consumers appreciate the new form factors and touch capabilities of Windows 8, the radical changes to the user interface, 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," IDC said.

PC sales are slumping, sales of Windows 8 are falling, and even Microsoft's own metrics provide little comfort if it sticks to its current course. With an update to Windows coming, the opportunity to give customers a way back to the classic features they love is fast approaching.

Change can only help repair sales of Windows. Repairing Microsoft's reputation so soon after its first "Vista moment" seven years ago, when another grand adventure into the future of computing also crashed? That's another matter. ®