News

Rumor: Next-Gen Windows Tablets Coming Fall 2012

• By Kurt Mackie
• March 05, 2011

Microsoft is planning to roll out a version of Windows for tablets during the 2012 school season, according to unnamed sources cited by Bloomberg media on Friday.

The sources may be referring to "Windows Next," a term Microsoft has used to describe a next-generation OS that will run on system-on-chips, including ARM-based ones, on PCs. Allegedly code-named "Windows 8," Windows Next may be the successor to Windows 7. Based on a purportedly leaked chart, Microsoft observers such as veteran Mary-Jo Foley have speculated at a mid-2012 release for Windows 8.

Microsoft employees appear to use the nomenclature of both Windows 8 and "Windows.next" to describe their work publicly, according to a ZDNet article, which hunted down the references. In any case, it would not be a surprise if Microsoft released its next-generation OS in late 2012: Windows 7 was released in October 2009 and Microsoft generally follows a three-year release cycle for its desktop Windows releases.

Windows 7 is already deployed on tablets manufactured Microsoft's hardware partners. Products include the ASUS EP121-1A011M tablet shown off at the January Consumer Electronics Show and HP's Slate 500 Tablet PC. In addition, some device makers have rolled out tablets for the health care industry based on Windows 7, including Motion, TabletKiosk, Tangent and Panasonic, according to a Microsoft blog.

One alternative avenue, putting Windows Embedded on tablets, seems not to be happening on the consumer front. Microsoft has different sets of codebases for its Windows Embedded OSes, some of which are used for industrial handheld devices. It's not clear why Microsoft hasn't moved to put Windows Embedded on tablets, although an article by Business Insider's Matt Rosoff, formerly an analyst with Directions on Microsoft, noted that Microsoft gets greater revenue per unit for its flagship desktop OS than for its embedded OSes.

In other words, Microsoft could sell Windows Embedded Compact 7, released this week, to OEMs for inclusion on tablets today. It could start to catch up with the tablet competition. However, if it did so, Microsoft would lose those higher Windows desktop OS revenues, Rosoff contends.

Microsoft seems committed to coming from behind in the tablet market, even with a 2012 release date. It faces stiff competition from tablet makers such as Apple, which just announced its second-generation dual-core iPad 2, which will ship next week. Tablets already are cutting into desktop PC sales, according to Gartner. The analyst firm just downplayed PC sales for this year and the next, largely based on the idea that tablet sales will cut into consumer and enterprise PC sales.

Microsoft seems to have a slightly different assessment about tablet sales versus PC sales. Peter Klein, Microsoft's chief financial officer, told shareholders in January that Microsoft acknowledges that tablets may be cutting into consumer-market Windows sales somewhat. However, the company expects that tablets will be purchased mostly as "secondary devices." If so, tablet sales might turn out to be cumulative, rather than cannibalistic, to PC sales.

In any case, Microsoft will face a long, hard trek if 2012 is its target year for serious tablet competition. According to Forrester Research's Senior Analyst Sarah Rotman Epps, U.S. consumers will buy 24.1 million tablets in 2011, and of those, "at least 20 million will be [Apple] iPads." She noted that Apple already has 65,000 apps in its ecosystem and has effectively marketed and distributed its products through its specialty stores, unlike much of the competition. Still, Rotman Epps didn't discount the possibility of seeing future tablet market disruption from companies such as Amazon, Sony and Microsoft.