iPad: A dead end sign for Microsoft?

Okay, Microsoft is the World’s largest software maker and has a huge revenues and profits. No need to remind me of that as I am well aware of it.  For about a decade Microsoft has held a virtual monopoly on end-user desktop operating systems and productivity software.  This has been the case since the company ruthlessly squeezed all competition out of the market, admittedly due to its own merits and the competition’s mistakes.

In the mid-1990s, when Microsoft assumed its dominant position it was mainly through foresight and courage to make an all out investment in Windows, moving all the company’s products to her own graphical platform and thus beating the companies that led other software segments to the that move.  It was a bold move and it paid off handsomely.  Since that time Microsoft managed to head off two main attacks on her dominant position: the first from Netscape and its browser as a platform ideals and the second from Linux on netbooks.

While the Web has become omnipresent in our everyday lives, Microsoft’s Windows in all of its many shapes is still the dominant platform from which most people access it.  By building Internet Explorer and bundling it with Windows Microsoft managed to wrestle control over how the majority browser  would be able to do from Netscape, helping to postpone the advance of the Web onto the realm of desktop-like applications.

When the first netbooks were introduced by Asus, they were running Linux and OpenOffice.org in order to keep costs down.  Microsoft saw the danger in allowing millions of computers to be sold with a competing Operating System and moved to head that off by licensing its older Windows XP system to the manufacturers of these systems for a very low fee.  Given the option of offering computers with cheap Windows or Linux most manufacturers opted for Windows and soon most models were coming out with Windows XP instead of Linux.

By extending the life of Windows XP and offering it almost for free, Microsoft managed to stave off a trend that would move millions of users into a competing platform, for a couple more years.

Now we come to the current state of affairs.  Apple introduced the iPad just a month ago and in less than a full month’s time has already sold over a million devices.  Several other companies are making moves to get into the tablet/touch market to try to climb onto the wave that Apple is riding.  One of the first companies to make a move was HP, with Microsoft’s support, announcing the Slate tablet in January, in an attempt to steal some of Apple’s thunder when the iPad was introduced.

As a marketing ploy it was not fully successful because it did not manage to drag the spotlight away from Apple and the iPad, but on another aspect it had too much success.  It managed to make the Slate tablet the call to arms for all critics of the iPad and was touted as an “iPad Killer”, with its USB ports and its ability to run Adobe’s Flash.  There was just one problem with that rhetoric: Windows.  Microsoft’s current operating system, Windows 7 is a huge improvement over its predecessor, but it is a desktop operating system.

As the iPad came on the market and more and more reports of its usage came out it must have been painfully obvious to the people at HP that Windows just wasn’t going to cut it as a rival for iPhone OS.  The Slate could not run Windows and hope to have the desired and necessary performance any more than the iPad could be running Mac OS X, instead of iPhone OS.  The level of responsiveness, battery life and ease of use expected in a device such as the Slate or the iPad was way beyond what the hardware of a netbook could hope to achieve running Windows 7, specially after the bar had been set high by the iPads early arrival on the market.

In a move that credits HP’s management the company decided to make a move to acquire Palm with its mobile expertise and its custom built mobile operating system webOS and dump Windows.  While this is probably a good move for HP, it is very bad for Microsoft as one of its major partners admits that Windows can’t play in this game.  Well, over the next couple of years, this is going to be the new game in town and a lot of action is going to happen.

Dell is moving to release several Android based mobile Internet devices, and Asus has announced both Android and Windows-based tablet devices.  A big question is will other players, such as Asus still go ahead with Windows-based tablets now that HP has cried wolf and ran for home?

With several companies eying this new game and Apple firmly set as in the home team’s side of the field, Microsoft seems very poorly positioned to secure a piece of this pie in the foreseeable future. Things might get even more complicated for Microsoft if down the road, in the not too distant future, Apple combines her Mac OS X and iPhone OS platforms in touch enabled desktop and notebook computers.

So far the iPad is selling like hot cakes and every other computer and device maker and their dogs are going to be trying to get on that bandwagon, but Microsoft seems to have missed the chance to get on early, when its attempts at creating an acceptable TabletPC failed miserably.  The software giant might still have many years of huge profits ahead, but being late to this game might be a serious error for Microsoft and it might just mean the beginning of the end for her dominance of the personal computing space.

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