Is this the year of Windows 8 tablets?

One outstanding question from my piece a couple of weeks ago is a question of Microsoft and the partner ecosystem finally have the pieces together to succeed in the tablet space.  There has been some movement these past couple of weeks, so this is both an update and additional thoughts.

The retail scene has been changing quickly and I expect that to continue through Black Friday.  When I wrote the original article there was positive news in terms of traffic I was seeing while visiting stores, and negative news about retail availability of all the newly announced tablets.  My observations about positive traffic continue.  I’ve been in 3 different Best Buy stores since then and in every case there were a lot of people looking at PCs, and the Surface family.  This is a completely different experience from last year where the PC departments in stores were empty.  But what about the problem of retail availability of all those announced products?

A few days ago I was coming to the conclusion that Microsoft was going to miss the holiday shopping season because new product still wasn’t in stores.  Then reports of Dell Venue 8 Pro sightings started pouring in.  Last night I had to run in to the local Microsoft Store to pick something up and they’d made the latest inventory transition.  I didn’t have time to survey everything, but the table featuring 3rd-party tablets sure caught my attention.  On it were 3 Dell Venue 8 Pros (DV8P), 2 Dell Venue 11 Pros, and 1 HP Omni 10.

This was my first chance to see Dell’s 11″ (nee, 10.8″) and HP’s entries.  My few seconds with each don’t justify much commentary other than a sigh of relief that a substantial number of Windows tablet options will actually in the retail channel as the holiday shopping season (already under way) ramps up.  But I do need to comment on price.  The HP Omni 10 was being offered for $399.  That’s a great price for a device with the specs it has.  Both devices felt good in my hands (again, just a few seconds worth).  Interestingly the Dell Venue 11 Pro felt lighter and smaller than the Microsoft Surface even though it has a slightly larger screen.  Hopefully I can pop into a Best Buy this weekend and see if they too have refreshed their Windows tablet offerings.  And spend a little more time playing with them.

I’ve written a bunch already on the DV8P, and if anything the more I use it the more I like it.  The reviews on it are generally very good, which should help drive interest.  One small detail I wanted to comment further on was something every reviewer comments on, the odd placement of the Start button.  Since the introduction of Windows 8 the standard placement has been on the front bottom, in the chrome around the display, when held in landscape mode.  On the DV8P it is on the top right edge when held in portrait mode and the upper left edge when held in landscape mode.  Like everyone else I thought this odd until last night.  I was using the device in landscape mode and realized my thumb was resting on the Start button.  All I had to do was press when I wanted to go to Start, and as I used it that way I realized the DV8P has the fastest arrangement of any device for getting to the Start screen.  By the end of the evening I was in love with what Dell had done.

Dell also seems to have been clever in their rollout of the DV8P.  Initially it was only available on their website and on Amazon.  And for the first few days Amazon offered a screaming deal with the $299 (list price) 32GB device available for $255.  Today they are offering it for $279.  Then it appeared at MicroCenter, where they also ran a special at $259 advertised in their flyers as “in-store only”.  They probably did this with other smaller channel partners that I’m unaware of.  And now it is being blasted into broad retail distribution.  This rolling introduction probably helped boost the excitement level around the device without straining Dell’s ability to ramp up manufacturing.

Of course today’s big news is the availability of the Nokia Lumia 2520 on Verizon, with availability on AT&T set for tomorrow.  The reviews are starting to come out and are generally very positive.  Unfortunately reviewers weren’t provided with the keyboard case so the reviews are incomplete, particularly as they relate to comparing the Surface and 2520.  But the really important news is that a nicely spec’d Windows RT tablet, that is going to get a strong marketing push, is available with LTE for the holiday shopping season.

Of course there are some negatives too.  The other three announced 8″ tablet offerings still haven’t made their way into retail as far as I can tell.  There is no 8″ tablet with LTE in the carrier channel.  Also missing in the carrier channel is a 10.1″ x86 (aka, full Windows 8.1) device with LTE.  And there is no absolutely blowout product offering.  No shockingly light offering.  No bleeding edge display offering.  No surprising hardware functionality offering.  And certainly no offering that combines all of those characteristics.  In a competitive comparison with the iPads and Android devices that moves much more of the sell into a software comparison.

The iPad has the best tablet-specific apps library.  Android is a distant second on tablet-specific apps but has the breadth of price points, capabilities, and unique ecosystems (e.g., Kindle Fire tablets are projections of the Amazon content ecosystem).  They also can run the very large library of Android phone apps.  Windows Tablets have Office, and in the case of x86 devices, the ability to run the entire library of Windows Desktop applications.  But the library of Windows Store applications, those really designed for a tablet environment, is still in its infancy.  And that remains a drag on Microsoft’s progress on tablets.

The other day someone started asking about the Dell Venue 8 Pro I was carrying.  It turns out their big problem with non-Windows tablets is that a SaaS offering they use for their business won’t work on those tablets.  Or rather, the customer-facing part of the service will but the administrative console requires a classic PC browser.  So I let him try accessing the administrative console with IE11 on the DV8P, and of course it worked.   And there have been plenty of times where my wife was having problems getting something done on a website with Safari on her iPad and I easily took care of it on my Surface.  Throw in all the scenarios with Office and you find many compelling reasons for a Windows Tablet over the iPad or an Android tablet.  This is the crutch that Microsoft needs to exploit until the Windows Store app library becomes a non-issue.  A year ago they proved inept at getting this message across while this year they are doing a much better job.

Which leads into the next area of interest.  Microsoft’s real focus, the area they must succeed in to get the Windows business back to health, is in the area of 2-in-1s.  All of the tablets I described above are supposed to be primarily tablets but also have the ability to be used as a notebook computer with the addition of various keyboard/touchpad/mouse options.  Some, like the Surface family, Nokia Lumia 2520 and the Dell Venue 11 Pro, will mostly be purchased with keyboard case options that make them more of a 2-in-1.  But a lot of the excitement this season may be in the convertibles and detachables that are intended as notebooks first and tablets second.

I haven’t spent as much time looking at “notebook first” 2-in-1s as I have at “tablet first” devices because of personal interest.  Although as I’ve mentioned before my wife did get a Lenovo Yoga 11s.  But the real action this season may very well be around devices like the ASUS T100, Lenovo’s Yoga family, the HP Split X2, and the numerous other devices in this category being offered by every PC maker.  The world’s population of notebooks is aging and last years botched launch of the Windows 8 generation did little to address pent-up demand.  I think a lot of the action I’ve been seeing in my retail store visits aren’t people saying “I need a tablet”, they are people saying “I need a new computer”.  Many will opt for a 2-in-1 over a traditional (touch or not) notebook.

Does a 2-in-1 sale count as a tablet sale?  Does it matter?  Last year I talked a lot about usage Minutes-Per-Day (MpD) and how traditional form factor MpD was declining because of tablet use.  If a 2-in-1 sale results in increased MpD of Windows usage, because the owner continues to use it in scenarios where today they put down their notebook and pick up their iPad, then Microsoft wins big.  What category analysts attribute the sale to is not really that relevant.

Windows 8.1 matures the Windows 8 generation of software to the point it is much more attractive to users than last year’s release.  Even those who remain non-believers are far more muted in their criticism.  Microsoft is doing a much better job of telling their story.  The OEMs have finally stepped up their game.  And the retail channel is in much better shape, from the larger number of Microsoft Stores to (most importantly in the U.S.) the vastly improved experience at Best Buy.  Plus the wide variety of channels from office supply (e.g., Staples) to discount (e.g., Wal-Mart) are going into this shopping season with a full array of Windows 8 generation products.  That’s a complete turnaround from the situation last year.  The odds are that this is going to be a decent holiday season for Microsoft and the Windows ecosystem.  Maybe with upside potential.

And then there is the elephant in the room.  While Microsoft will undoubtedly have a long tough battle against the iPad and Android tablets amongst consumers, its path to success with businesses is much clearer.  With Windows 8.1, with far more appropriate hardware offerings from OEMs, and with Microsoft better focused on the business tablet market than they were a year ago, this could be what launches Microsoft into true tablet success.  That won’t show up in the holiday sales numbers, but it will show up strongly in sales numbers over the next 12 months.

So is this the year of Windows 8 tablets?  Probably.  Not enough that they have Apple, Google, Samsung, or other top-tier Android vendors on the run.  But enough that its clear their foray into the tablet space is going to succeed.

 

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18 Responses to Is this the year of Windows 8 tablets?

  1. Brian says:

    Microsoft needs to change their Windows release rhythm. Releasing a new version of Windows just after school starts makes no sense. They should release in April or May, have first wave OEM in stores at the start of Summer for the back to school season, and then press the OEMs to have their v1.5 product in place before the fall buying season.

    Windows 8 has been as hard on OEMs as Vista was (Win8 really demanded a touch-screen and imaginative form factors; Vista changed all the rules from a display driver and security sense). Last Christmas was a washout as a result.

    Of course, the other big change since this time last year has been the release of Haswell. My 2-in-1 Haswell-equipped Sony Vaio (which weighs substantially less than 3 lbs) has resulted in my wife being the sole proprietor of the family Surface RT we shared for a year.

  2. DW says:

    Hal, did you try to actually buy a Windows-based tablet, or just look at them in the stores? My experience is that there is very little actual inventory for sale. All of the Microsoft stores I have visited and called say that they have been out of Surface Pro since launch, and have no idea when they will be getting more. Ditto for the new Lenovo’s at the Microsoft Store, Best Buy and Office Depot. Until Microsoft can figure out how to actually produce products and convince their OEM partners to do the same, there won’t be any “Year of” anything for Microsoft except for maybe “Year of Once Again Disappointing Customers Then Eventually Winding Up With Too Much Inventory That Has To Be Written Off…Again”.

    PS: Just for grins, every time I went into a Microsoft store and was told that the products I wanted were out of stock, I then walked across the street/hall to the Apple Store, and found plenty of available inventory for the iPad Mini, iPad Air, and the new Mac Books.

    • halberenson says:

      I did not try today. I have seen the Surface, Surface 2, and Surface Pro 2 in stock on previous visits. If I make a round of visits in the next couple of days I’ll check on actual availability.

      Apple stores are short on the iPad Mini with Retina Display. Everything else is well stocked.

  3. Aaron says:

    I’d be really interested to see how folks were combining devices in the real world to actually get work done. How do folks combine the various sizes of phones, phablets, 8″ tablets, 10″ tablets, 2 in 1′s, traditional laptops, all-in-ones, and traditional desktops?

    For example, I use an SP2 in a docking station connected to dual 24″ monitors as my primary machine. I pull the SP2 out of the docking station when I need to do real work away from home. I have a Surface RT that I use for e-reading or for web surfing on the couch. My phone is a Lumina 920. Skydrive ties everything together with zero effort on my part.

    One issue, is that it took me a few months of contemplating to choose this configuration. There were lots of pros and cons. I almost went with the big Dell 27″ all-in-one to go with my Surface RT. I also considered the Yoga instead of the SP2.

    Dell/MSFT need to run commercials with folks using the all-in-one in the kitchen and them seamlessly switching to the DV8P as they leave the house and then switching to the phone. There are lots of great options, people just need to see examples of folks putting all these pieces together and being very productive.

    • Tim says:

      I’d really like to get your take on the SP2 when on the road. What do you typically do with it and for how long in one sitting? Do you have any regrets for not going with a slightly bigger touch-based ultrabook for on-the-road work?

      • Aaron says:

        My initial impression is that I love the SP2 form factor. It’s heavier than my RT, but barely noticeable in my bag when travelling. It fits nicely on the tray table of a plane.

        If I need to work on that small screen for more than an hour or so, it can strain my 40+ year old eyes. I much prefer working on bigger screens. However, I had the same issue on my old laptop, so the trade really isn’t that significant. I will say this, I’m not on the road much. If I was a real road warrior spending multiple nights in hotels, etc. having to do lots of real work away from the office, I might get something bigger. The SP2 sits in the docking station and feels right at home in my home office. The bigger 2in1′s just wouldn’t sit as nicely on my desk.

        Battery life is fine. I’m never going to sit and watch hours of video throughout the day. Never even come close to running out of power.

        I’m currently using the touch cover from my RT when on the road. It works, but I’ll eventually get a type cover. I can type reasonably quickly with the type cover, but you have to trust yourself since there isn’t that sense of physical feedback. The most interesting thing is that I like my RT more without the cover attached. Just out of habit I always left the cover on the RT. The RT just seems lighter now and I’ll carry it around the house.

        My phone is a Lumina 920 and I think my next phone will be the smallest and lightest Windows phone available. It’s not that I think the Lumina is heavy, I just don’t use the thing. I use my phone for light texting, email, and very occasionally calls. I just want a small and light phone that syncs with all my other devices.

        My one concern with all these MSFT offerings is that it can be difficult to decide the combination that works best for you. You have to consider the pros and cons of all the different sizes and it can get confusing. I really think that is how Apple made big headway 10 years ago. People got tired of configuring PCs on the Dell website. No one really understood why they should choose one video card over another. Apple was simple, not giving folks choices. MSFT needs to help folks see how all this stuff works together.

        • halberenson says:

          One point here, if people are willing to trade a little weight to get longer battery life in a SP/SP2 then the upcoming battery keyboard cover would appear to be their dream come true.

    • halberenson says:

      Ok, we have the same usage pattern!

      I would love to see ads like the one you suggest. Just last night I was thinking about how seamlessly I can walk upstairs from my office and randomly pick up the Surface, DV8P, or even my wife’s Yoga and just continue on with what I was doing on my SP2 desktop setup. I’d installed a new app on the SP2 and sure enough when I picked up the DV8P the tile was there with its little download symbol. I clicked on the tile and was off and running in a few seconds with the same app. And with Skydrive lots of things just seem like magic, with all my data and most (its up to the app of course) settings magically going with me between machines.

  4. Tim says:

    Regarding the path to success with businesses, what do you think about the cost model of side-loading in the enterprise and whether that could be a detriment to Microsoft’s growth there? Rocky Lhokta (MS Regional Director, software author/speaker) had written a bit about the challenges that exist in that space: http://www.lhotka.net/weblog/Windows8WinRTLicensingIdeas.aspx

    • halberenson says:

      Keep in mind Rocky’s “If you work for a large enterprise with EA/SA agreements and an IT staff that manages all your domain-joined Windows 8 Enterprise workstations you can probably stop reading now. You are the one demographic that is well-covered by the existing licensing model.” point. This is where Microsoft’s bread and butter is. So the issue is really about custom apps for the SMB space. I haven’t thought about it a lot but always expected Microsoft to adapt the licensing model based on feedback from devs and customers.

      • Bob - Former DECie says:

        I also follow Rocky’s blog and have read that. I can’t understand why Microsoft keeps such a ridiculous licensing model in place for SMBs while they are practically begging developers to write for the platform. I’ll bet Microsoft won’t understand what happened when these SMBs grow into the large enterprises that Microsoft targets and are non-Microsoft shops. Microsoft understands that they need college graduates to be expecting to find Microsoft products in the business world and have appropriate educational packages in place. Why are they so blind in the SMB area?

        • halberenson says:

          They aren’t blind, but like most every other company they haven’t been able to figure out how to really crack the SMB market in an unusual way. It is extremely fragmented with a complex partner ecosystem in the way. Few SMB-focused initiatives succeed at any scale.

          More specifically there is the dynamic of movement towards SaaS solutions. You don’t need side-loading to get the client for most of these. And they want to encourage ISVs to distribute clients through the regular store (although only people who have access to the server or service can do anything other than install them). So the licensing model for side-loading my indeed be designed to discourage its use. Basically it is a bet against bespoke applications in the SMB market, or a bet that bespoke applications in that market will have browser-based UIs.

          If they are wrong then they’ll be forced to change. But most of the data probably support what they are doing. Meanwhile lots of people feel the pain of the transition.

          • Tim says:

            “Basically it is a bet against bespoke applications in the SMB market, or a bet that bespoke applications in that market will have browser-based UIs.”

            Interesting take. I think that is also what Rocky purports in a more recent post of his – that the cost and scale of browser-based LOB apps is more palatable than WinRT (or iOS/Android).

  5. MarcelDevG says:

    Thanks for the article :)
    Some experiences of my own: I was at a local audio/video/pc/tablet/Phone store, part of a chain her in Europe (Saturn it’s called), and this was in a town of about 90.000, so by your standards small. And lo and behold: there was a small in-store surface counter. And there were people asking for surfaces. I even managed to buy a ethernet/usb adapter for my SP2.
    Most people were buying laptops or 2-1′s. There was also a (larger) Mac department and a very large Samsung department. But my impression was that most activity was at the Win8 tablets/laptops/2-1s. And I agreed with the others, Microsoft has the best story on all those devices working together. But not everyone knows this, or have experienced this. Maybe we were all too optimistic that the new vision (if it was a vision) could be swallowed by the consumers in the timeframe since the Windows 8 launch. I also think that the big retailers are willing to bet more on this.
    I (as a software developer) think it’s finally worthwhile to start investing in the development of Win8 tablet applications, as it’s clear that some momentum is building, and that quick adaptions of old-style windows programs are not feasible. If you started a year ago, you may have a head start, but you could also be too soon.

    • halberenson says:

      Thanks for another data point!

      BTW, I looked and all the AT&T stores in the Denver area are out of stock on the Lumia 2520. microsoftstore.com is out of stock on many things, including the Lumia 2520, Surface 2 and some configurations (32GB, 256GB) of the Surface Pro 2. Many other tablets show as out of stock though both the DV8P and DV11P, as well as the HP Omni 10, are in stock. I’m going to stop by the actual store on Monday and see what the deal is.

  6. > Or rather, the customer-facing part of the service will but the administrative console requires a classic PC browser. So I let him try accessing the administrative console with IE11 on the DV8P, and of course it worked. And there have been plenty of times where my wife was having problems getting something done on a website with Safari on her iPad and I easily took care of it on my Surface **Pro**

    There, fixed that for you. I still don’t think consumers remotely understand the difference between Windows RT and regular Windows, and if RT tablets were selling in greater numbers I think it would become a big story. Of your two examples, would either one be true on an RT tablet?

    The RT devices (mostly Surface, and Verizon is also advertising tablets heavily) are currently getting far more marketing than any of the $500 Atom devices (like DV8P, Asus T100, etc.), and I think consumers will be disappointed once they realize that Windows doesn’t always mean “Win32″

  7. halberenson says:

    No, Surface RT works just fine for these scenarios. And I’ve talked to many people who get it. They just have no need for desktop apps other than Office. I carried the Surface RT around for a year and rarely, and I do mean RARELY, cared that I couldn’t install random desktop apps.

    You also have the pricing point all wrong. The DV8P is a $299 device and is getting very heavy promotion. The ASUS T100 is a $399 device and is getting little promotion. But that is Dell vs. ASUS.

  8. Tim says:

    Speaking of the 2-in-1 sales (and whether that matters when categorizing Windows sales figures)…I visited Best Buy two weeks ago looking to replace my aging laptop. Not only had Best Buy transformed its Windows display area into a very appealing experience, the 2-in-1s played a prominent part. It was interesting to see the small Apple area off to the side with relatively few options.

    Unfortunately, Best Buy didn’t have in stock what I wanted (the Yoga 2 Pro) except for the display model, so I had to order it. I’m now almost a week into using the new device, and I realize having a good touch experience on a well-designed convertible laptop is worth the extra money.

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