Ballmer Could Be Out if Windows 8 Tanks, Analysts Say

The New York Post paints a very gloomy picture for Microsoft CEO Steve Ballmer if Windows 8 doesn't prove to be a big success, especially in the mobile sector. Ballmer, who admittedly missed the smartphone and tablet boat once Apple invaded the mobile scene with its iPhone and iPad, can't bomb again, the paper said. Even more, if the platform disappoints, he could be out altogether.

The problem Microsoft may be having at the moment is an identity crisis. The company is best known for its desktop Windows platform which resides on millions of desktops and laptops. Customers have "computed" in a certain way for around two decades. Now the company wants to shake up the PC sector by offering a completely new interface that spans multiple form factors. It's even selling its own hardware.

Thing is, not everyone is hip to change. Personally, after upgrading to Windows 8 the moment it became available, the "Modern UI" has been used very, very little. If fact, it's seemingly nonexistent thanks to Stardock's Start8 app which lets the PC boot directly into the desktop. The Windows 8 apps haven't been updated in weeks, and the charms are rarely used.

But thanks to Windows 8, using devices like a Windows 8 tablet, Windows Phone 8 device and an Xbox console (current or next) will be easier to understand thanks to the experience. But you can't help but wonder if consumers will be reluctant to update to Windows 8 – or purchase a new machine with Windows 8 installed – because they're reluctant to change. Up until now, all Microsoft and Ballmer have seemingly done is promote that new interface, not the improved desktop experience.

"If it ain't broke, don't fix it" is what I hear in the south. But we should thanks Apple for this big change. Apple turned bulky slates into convenient, super-thin tablets. Apple made the smartphone fun and sexy with the iPhone and iOS. Microsoft is attempting its own flavor of sexy and convenience with Windows 8, a baseline blanket that expands multiple screens, unlike Apple. Yet it's here in the mobile sector, this mobile arena, that Microsoft really needs to succeed.

"Absolutely there is lots at stake in terms of the mobile segment," said Gartner analyst Carolina Milanesi in speaking with the New York Post. "Microsoft needs to be successful in mobile, because it’s where consumers are going."

So far that mobile effort looks shaky. Despite Microsoft reporting that sales of the Surface RT are doing well, the company supposedly pushed up the retail release of its self-branded ARM-based tablet – originally only sold through Microsoft's online and physical stores – into December because of a lack of sales this quarter. Barclays Capital analysts even predicts that only 700,000 units will be sold before the end of the year. How many units of the iPad mini will Apple sell in the same quarter?

The big problem, it seems, is not only with the previously limited Microsoft-only availability and the platform's new Modern UI, but in the Surface RT price itself. "Industry observers" claim that consumers think the average $550 pricetag is too high, especially when they're used to shelling out around $200 for 7-inch models. Google's own Nexus 10 starts at $399, and Apple's iPad at $499. Because of this, Microsoft may be forced to slash prices in order to move units off shelves.

On the smartphone front, Microsoft reports that the company is selling four times as many Windows Phone 8 smartphones as it did last year. Still, Windows phones will only capture 13-percent of the market by 2016, Gartner predicts. Meanwhile on the PC front, Milanesi points out that, according to Microsoft's own admission, 40 million people have upgraded to Windows 8 in the desktop/notebook segment. That's less than 1-percent of all Windows-based laptops and desktops currently in use.

With all that said, will Microsoft's four-window assault on Apple and Google work? It's too early to tell for the moment, but if it doesn't, Ballmer could be outed as the New York Post suggests. Bill Gates may even make a Steve Jobs-like return to bring balance and order back into the Microsoft Force.

To read the full report from The New York Post, head here.

_{Contact Us for News Tips, Corrections and Feedback}