For software engineer Tim Paterson, using Windows 8 was like taking a step back in time to the days of MS-DOS. And he would know — after all, he did write the code behind Microsoft’s early operating system in the 1980s.
Paterson remembers tearing the cellophane off his 27-inch touchscreen Windows 8 desktop computer. He tried to launch the Windows Task Scheduler, a routine application he had used countless times before. But it was nowhere to be found.
The precious Start Menu was gone, replaced with a search box that couldn’t find the application because of a single typo.
“OK, so we have to type in commands like DOS?” he told GeekWire earlier this week. “Some big step forward.”
Paterson’s frustrations aren’t unique, and have been well-documented across Windows 8 users since the operating system launched in 2012.
This week represents Microsoft’s chance to fix all that.
With the launch of Windows 10, starting on Wednesday, Microsoft is doing everything it can to claw its way back to the top of an industry that’s in the midst of dramatic changes. Windows 10 is designed to bridge the gap between PCs — the Microsoft operating system’s traditional stronghold — and the mobile devices and tablets where Microsoft desperately needs a bigger footprint.
In addition to appeasing longtime Windows users, a successful launch would set the stage for Microsoft to play a central role in emerging areas such as augmented reality and the Internet of Things, the coming wave of small, ubiquitous devices powered by cloud services.
Windows 10 will be a free upgrade for millions of Windows users currently running Windows 7 and Windows 8.1, followed by regular updates as part of a strategy that Microsoft calls “Windows as a Service.”
Developers will be able to write universal apps that work across Windows devices of all sizes, from smartphones to large screens. And yes, the Start Menu is returning, joined by a new browser called Edge, the Cortana intelligent assistant, the ability to stream games from Xbox One, new options for biometric login, and a new feature called “Continuum” that will shift hybrid machines from tablet or smartphone mode to desktop mode, and back again.
A pivotal moment for Microsoft
It’s a delicate balance between the familiar experience that Windows users have enjoyed for decades and the company’s vision for where the world is going next. Beginning this week, we’ll start see if Microsoft was bold enough to push one of its most important products into the next era of computing, or if it went too far and left its fanbase waiting on the side of the road for another few years.
“We want to move people from needing Windows, to choosing Windows to loving Windows,” said Microsoft CEO Satya Nadella at the company’s unveiling of Windows 10’s consumer features in January.
What the company does next is critically important for its future, says Morningstar senior equity analyst Norman Young. Sure, Microsoft is more diverse than ever with new — and growing — revenue streams like its Azure cloud services. But Young says none of that will matter if we continue to see Microsoft lose its dominance in operating systems. The company has frustrated desktop users and is being lapped on mobile, with Windows Phone’s market share hovering around 3 percent.
With Microsoft’s consumer business slipping, its core enterprise business could also be at risk, Young says.
The company’s quarterly results just last week told the tale of another tough few months for its operating system business, including a 22 percent decline in revenue from versions of Windows sold to computer makers, and an 8 percent decline in Windows volume licensing revenue. Part of that was the normal lull in advance of a major Windows release, but it also reflects a long-term trend.
If Microsoft doesn’t reverse the trend, the company whose software once powered the computer revolution will be relegated to “just another third party provider. It would no longer be steering the discussion,” Young said.
Microsoft Windows still has more than 90 percent market share on desktop computers worldwide, according to usage data from Net Applications. However, as the world has shifted to tablets and smartphones, the relevant market has become much bigger. Windows is installed on just 14 percent of shipping phones, tablets, notebooks and desktop computers in 2015, according to the Gartner research firm.
Windows 8 was supposed to be the company’s response to the trend three years ago, built with smaller screens and touch interfaces in mind. But the update has done little to stop the bleeding because of its general unpopularity.
Even on desktop computers, a large portion of Microsoft’s user base, more than 60 percent of the global PC market, is still using Windows 7, released six years ago. About 16 percent of users are on Windows 8 or 8.1, according to the Net Applications data.
Jon Bach, who runs custom PC company Puget Systems in the Seattle area, says his company gives customers the choice between Windows 7 and 8, and they choose the older version about 75 percent of the time.
So this is Microsoft’s first challenge with Windows 10: Getting its existing users to upgrade to the newest version of Windows, giving the company a current and up-to-date user base, better positioned to receive new updates and future innovations from the company. This helps to explain why the company took the unprecedented step of offering Windows 10 as a free upgrade to existing Windows 7 and Windows 8.1 users.
Young said the giveaway will be difficult in the short term, but “they need market share. They just need market share because they’re going to go to developers and say this is why you need to develop for Windows.”
The company has publicly stated a goal of getting 1 billion devices running Windows 10 within 2 to 3 years of release. This might not be as crazy as it sounds: Gartner estimates that nearly 2.5 billion smartphones, tablets, notebooks and computers will ship worldwide this year.
Speaking on Microsoft’s earnings conference call last week, Nadella said he sees three phases for Windows 10’s rollout, starting with the push this week to get existing Windows users to upgrade their machines to the new operating system. The second phase will be the release of new Windows 10 devices by hardware makers for the holidays, followed by a push for enterprise adoption.
Bach — who has been testing the operating system as part of the new Windows Insider Program — is already predicting a quick adoption rate.
At his own company, he can’t wait to drop Windows 8 from his product lineup altogether. He’ll sell his last machine with that software on Wednesday, and from then on it will be all Windows 10 — with a few Windows 7 sales for those who still want it for a little bit longer.
Within about two weeks, Bach predicted 90 percent of the machines Puget Systems makes will run Microsoft’s latest operating system. That’s what happened when the ever-popular Windows 7 launched in 2009, and he said, “this feels like Windows 7 all over again.”
What has Bach so optimistic about Windows 10? The simple fact that it’s not Windows 8. He said Windows 10 has everything that he liked about the previous version, but without the unpopular user interface issues.
“It’s funny when you judge an operating system on what it doesn’t have,” Bach said. “But I’ll be able to run a modern operating system without being annoyed by it.”
‘One Windows to Rule Them All’
Of course, Windows 10 does have more to offer other than a new name and a fresh start.
The company is breaking itself from the multi-year production cycle it has used for major Windows releases for more than a decade, in exchange for a constantly updated model it calls “Windows as a Service.” But Piper Jaffray senior research analyst Katherine Egbert says you can think of it as “one Windows to rule them all.”
Windows 10 is meant to be the company’s last blowout operating system release. From now on, smaller updates will be rolled out constantly. It’ll reach all devices — from traditional desktops, to tablets and smartphones, and later the new HoloLens augmented reality headsets and Internet of Things devices.
Egbert says it’s all part of a bigger vision for the Windows brand, as it transitions from a piece of stagnant software that primarily powers PCs to a constantly-updated platform that follows users from one device to the next.
Customers who have always liked their desktop experience will suddenly be able to find something similar on other Microsoft devices and services that in the past they wouldn’t have even tried.
Developers who have been staying away from Microsoft’s mobile offerings due to lack of customer interest, will suddenly have a chance to build a single application that can reach millions more users on whatever piece of hardware they prefer.
Neither Young nor Ebert would go so far as to say Microsoft has found the strategy that will revive its mobile business, but it’s certainly going to be a valiant effort.
Young still wonders how Windows 10 will be received in the real world, where people aren’t necessarily looking for the same apps on different pieces of hardware they fundamentally use differently. However, he said, if there’s anything that can get developers onboard and solve Microsoft’s mobile headaches, “this is it.”
As for Windows 10 features, we know what to expect because the company has been letting testers use the platform for months through the Windows Insider program. The Start Menu will be back, the Cortana personal assistant will come baked in, Internet Explorer will be replaced as a default by the new Edge browser, and you’ll be able to stream games to your PC from Xbox One.
It’s the biggest test yet for the “One Microsoft” strategy through which the company is trying to bring its different products and divisions together, including the recent combination of the Windows and Devices groups under operating systems chief Terry Myerson.
Young said this launch is set to have a slower burn than previous versions.
It’s happening earlier than usual, so we won’t see the full scope of new Windows 10 devices until we get closer to the holiday shopping season. There won’t be too many surprises in the features department and the company is giving users a full year to take advantage of the free upgrade. Even Nadella’s 1 billion devices goal gives the company years to really penetrate the market.
But Young says first impressions count, and the barrage of initial reviews coming at us later this week will start to write the narrative of Windows 10 and how it’s perceived in the marketplace.
In the meantime, users like MS-DOS creator Tim Paterson are left watching the headlines for clues as to what’s coming next.
Paterson had planned to be cordial when we called asking for his take, but that was before we got him going on the “insane” Windows 8 quirks that have been driving him absolutely crazy. “I shouldn’t have called it insane,” Paterson said — more because of appearances than actually thinking the user interface is anything but insane.
Paterson retired from Microsoft in 1998 but remains a loyal Windows user. And like a lot of Windows 8 customers, he says it’s been a frustrating product cycle. Paterson says he’s already clicked the button to upgrade. He has no way of knowing if Windows 10 is going to be the solution he’s been waiting for, but he is optimistic.
But for now he waits — right with the rest of the Windows universe.