Microsoft and its OEMs stick to an outdated tablet strategy

'They don't quite get it,' says analyst

When it comes to tablets, Microsoft and its OEMs don't know where they're going, an analyst said today.

"There's still the idea that they don't quite get it," said Carolina Milanesi of Gartner in an interview. "And I don't think the vendors get it either."

Milanesi was reacting to the debut Monday of a pair of Windows devices, including one of the first 8-in. tablets to run Microsoft's newest operating system, and an offbeat hybrid that runs both Windows 8 and Android.

At the Computex trade show in Taipei, Taiwan, PC maker Acer showed its Iconia W3, an 8.1-in. tablet powered by an Intel Atom processor and running Windows 8. The Iconia W3 will be available for pre-order Tuesday at online and brick-and-mortar outlets, including Amazon.com, Microsoft's online and physical stores, Staples and Wal-Mart. List prices for the tablet will be $379 for a 32GB version and $429 for a 64GB device.

Acer has pre-installed Office Home & Student 2013 -- a suite not legal for the workplace -- on the Iconia, and trumpeted the bundle in its press release. "It's ideal for professionals, students and families who want the ease of a one-hand tablet with access to programs such as Word, Excel, PowerPoint and OneNote," Acer said.

To bolster the productivity chops of the Iconia, Acer will also sell an optional keyboard that acts as a stand. That keyboard, however, is substantially larger than the tablet itself, about the size of one found on a 13-in. laptop.

The tablet was no real surprise, as Amazon had leaked its price and specifications a month ago.

Milanesi's problem with Acer's tablet wasn't its size, but its productivity pitch, evidenced by the inclusion of Office and the big keyboard. "Office on an 8-in. [tablet]? Who cares?" she said. "The [screen] real estate is what it is," she added, implying that the suite was worthless on a display that size.

At the same time, she wondered what happened to Windows RT, the Windows 8 spin-off that Microsoft once touted as the touch OS for tablets, and the one she and other analysts once expected to serve as the brains of smaller-sized Windows tablets.

"Windows RT is not in a very good spot," she observed, pointing to the Iconia running Windows 8 instead, and the continued snubbing of the OS by Microsoft's hardware partners. "They blame Microsoft for a very confused message on [Windows] RT. They don't think that Microsoft has properly explained it to customers."

Instead, Microsoft has pushed Windows 8 as the operating system for smaller tablets. In March, the Wall Street Journal, citing unnamed sources, claimed that Microsoft had slashed the price of a Windows 8 and Office 2013 licensing combo from around $120 to just $30. The discount applied to OEMs for PCs and other devices with touch screens smaller than 10.8 inches, said the financial newspaper.

Acer's Iconia W3 is one fruit of that promotion, Milanesi agreed.

Milanesi also cited another Taiwanese OEM, Asus, which on Monday unveiled the Transformer Book Trio, a Hydra-hybrid tablet, smartphone and notebook that runs both Windows 8 and Google's Android.

Her problem with both devices was that they illustrated a stuck-in-the-past mentality. "Vendors are as confused as they were at CES [in January] about form factors and the operating system, and how the two relate," Milanesi said.

Consumers won't be attracted to an 8-in. tablet simply because it includes Office or that it runs Windows 8 rather than Windows RT, she maintained, nor will enterprises, even though they've shown interest in that format for touch-able applications, like email and filling out forms.

"OEMs continue to think about form factor and pricing rather than usage models," Milanesi contended. "They seem totally confused about who the audience is."

Microsoft's failure to set direction, or better put, its decision to promote Windows 8 and Office, even on too-small tablets, shows it's still relying on old habits. It's leaving the OEMs to do what they want, or even worse encouraging them, even if that means devices that don't match form with function -- such as the Iconia -- or results in a hodgepodge like the Transformer.

It's as if the massive shift of the last few years had never happened, as if throwing everything against a virtual wall to see what sticks is still a viable strategy.

"Samsung can do that, because that's what they do," said Milanesi, but she couldn't name another vendor with the luxury. Microsoft and its traditional partners certainly don't, she argued, not when PC sales are flagging and Windows is a very distant third as a tablet OS, when Apple has clearly drawn the lines between personal computer and tablet, and Google's Android has a stranglehold on low prices.

Two devices do not make an ecosystem, Milanesi acknowledged. But the muddled strategy they exemplified left her cold.

She understood why Acer went with Windows 8: Microsoft made an offer it couldn't refuse. But that didn't make it right. "It's an old-fashioned way of thinking," Milanesi said. "Where do you put RT then? Will it be left to the phone manufacturers, because they know ARM? Then what you'll have is PCs coming from one end and larger phones from the other."

This article, Microsoft and its OEMs stick to an outdated tablet strategy, was originally published at Computerworld.com.

Gregg Keizer covers Microsoft, security issues, Apple, Web browsers and general technology breaking news for Computerworld. Follow Gregg on Twitter at  @gkeizer, on Google+ or subscribe to Gregg's RSS feed . His email address is gkeizer@computerworld.com.

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