Will CES be Make-or-Break Time for Microsoft?

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The rumor mill has it that Microsoft will be showing off its Windows-based tablets and give a first look at Windows 8 at the upcoming CES next month. It's beginning to look as if CES 2011 may be a make-or-break time for Microsoft, with a great deal riding on its tablet introduction and any news about Windows Phone 7.

The New York Times reports that Microsoft will show off "a slew of new slates that it hopes will offer some competition to the Apple iPad." The Windows-based tablets will come from Dell, Samsung, and others, the paper adds.

The paper says that the tablets will be aimed more at business than entertainment, and at least one will include a slideout keyboard. It has this quote from an unnamed source who is said to be familiar with Microsoft's tablet plans:

"The company believes there is a huge market for business people who want to enjoy a slate for reading newspapers and magazines and then work on Microsoft Word, Excel or PowerPoint while doing work."

A great deal is riding on those tablets, because so far Microsoft's mobile strategy has not gone well. By almost all accounts, the rollout of Windows Phone 7 has been less-than-stellar. Most recently, a Goldman Sachs technology analyst wrote in a research note that Windows Phone 7 market share won't hit double digits in 2011. She added that because of Microsoft's inability to gain any traction with Windows Phone 7 or tablets, the company's top-line growth will fall to seven percent in 2011 from 12 percent in 2010.

Even many long-time Microsoft supporters have been critical of the Windows Phone 7 rollout. Paul Thurrot, in a blog entry on his WindowsITPro site levels this criticism:

When Microsoft delivered a woefully incomplete 1.0 release of Windows Phone in October, it promised to quickly fix problems, add missing features, and address user concerns via a series of software updates. Indeed, at the Windows Phone 7 launch event, I and several other reviewers were told point blank that Microsoft planned to ship "a compelling update very, very soon." That update has yet to appear, let alone any other updates, despite the fact that users have documents dozens of problems with the current system. Rumor has it that the first planned update, adding copy and paste support, won't even ship until January at the earliest.

Thurrot adds:

I think that Thurrot's right, and that Microsoft will come to the show armed with whatever good information it can muster about Windows Phone 7 sales, and attempt to put the best spin possible on it.

The time is getting short for Microsoft to get its mobile strategy right. Windows Phone 7 so far has done nothing to eat into the success of Android and the iPhone, and Microsoft's window of opportunity might be closing there.

Tablets are another story --- if Microsoft can release compelling ones, it may not have to cede that market to the iPad and upcoming Android tablets. That's why the upcoming CES may be make-or-break time for the company. If its tablets aren't great products, Microsoft may not be able to catch up in tablets or smartphones.

This story, "Will CES be Make-or-Break Time for Microsoft?" was originally published by Computerworld.

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