In a CNBC interview interview aired on Monday, Microsoft Chairman Bill Gates suggests that Windows 8 and Microsoft's Surface tablet line could ultimately dethrone Apple's iPad from its global tablet crown because iPad "users are frustrated."
Yikes! I guess Gates has access to the really good stuff.
Office Should Be Everywhere
Last month, I took Microsoft CEO Steve Ballmer to task for delaying the arrival of Microsoft Office productivity suite on devices running Apple's iOS and Google's Android operating system. I was hoping Gates would set Ballmer straight. Unfortunately, Gates appears as confused as Ballmer - and equally tied to the contracting PC ecosystem over which Microsoft has long ruled.
It's great that Gates cares so much about user frustration. Only, in this case he gets it exactly wrong:
A lot of (iPad) users are frustrated. They can't type. They can't create documents. So we're providing them something with the benefits they've seen that has made that a big category but without giving up what they expect in a PC. If you have Surface or Surface Pro, you have the portability of the tablet but the richness in terms of the keyboard (and) Microsoft Office of the PC.
Wrong, wrong, wrong.
Users are not clamoring for iPad to be more like a PC. If anything, users want their PCs to be more like the iPad. So far at least, the market makes that pretty darn clear: In the most recent quarter, Apple sold 19.5 million iPads - compared to 11.8 million in the same quarter last year. The Surface? Not so much.
According to IDC tablet sales data, of the 49.2 million tablets that shipped this past quarter, the Surface accounted for a paltry 0.9 million - 1.8% of the market. In other words, the Surface barely rises above a rounding error. Worse, it's not just the Surface. As IDC notes: "(All) Windows 8 and Windows RT tablets continued to struggle to gain traction in the market." The combined total of Windows 8 and Windows RT sales across all vendors hits a still-minuscule 1.8 million units.
That's about what Apple's iPad line sells in a week.
Gates Doubles Down On Ballmer's Mobile Strategy
Earlier this year, Gates surprised analysts when he publicly stated that Microsoft's mobile strategy was "clearly a mistake." Many observers believed we would soon witness a rapid turnaround in the company's mobile strategy - including the Surface and Windows Phone.
No such luck. Today's Bill Gates is completely on-message with Steve Ballmer:
Windows 8 is revolutionary in that it takes the benefits of the tablet and the benefits of the PC (so) if you have Surface and Surface Pro you've got that portability of the tablet but the richness in terms of the keyboard and Microsoft Office of the PC.
Gates is looking in the rear view mirror. While the global Windows user base of 1.25 billion is indeed massive, the PC market is no longer growing. Apple's iOS - iPhone and iPad - are poised to surpass Windows. And Apple's iOS is going to be only the second most popular personal computing platform - after Android.
Rather than touting the add-on Surface keyboard and the tablet's support of Office, Microsoft should be focused on porting Office to what will soon be the world's two most popular personal computing platforms - iOS and Android. As I said last month, "There was a time when Apple needed Office to be on the Mac. That time is past. Now, Microsoft needs Office to be on Apple's iOS and Google's Android."
The numbers don't lie: For the past quarter, the tablet market - which includes Surface - grew 142%. In stark contrast, the PC market fell 13.9%.
(See also The Real Reason Windows Phone Is Failing.)
Inexplicably, Gates and Ballmer don't seem to see what everyone else is looking at. The market has spoken, and the market does not want to be tied to the PC. Microsoft has an opportunity to leverage its strengths in productivity software to the leading platforms, but is too stubborn to let go of its dreams of Windows dominating the mobile space. Clinging to the proverbial 'stay the course' message is exactly the wrong thing for Microsoft to say and do.
Image of Bill Gates courtesy of Shutterstock.