Windows 8 Cracks 10% Market Share, But MSFT Still in Danger

The milestone is an important one for Windows 8, but MSFT needs to do better

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Windows 8 Cracks 10% Market Share, But MSFT Still in Danger

Microsoft (MSFT) received some good news to start off the new year after reports that its Windows 8 and Windows 8.1 operating systems made gains through December to crack the 10% barrier of total PC installs. That’s 11.6% of all Windows users.

Windows XP retirement 300x194 Windows 8 Cracks 10% Market Share, But MSFT Still in Danger

Perhaps even better, Windows XP — the OS it released 12 years ago and has been supporting ever since — saw a significant decline, finally dropping below 30% of total PC users (or 31.9% of all Windows users). While both stats sound encouraging, Microsoft is still way off the pace considering the competition, and there’s a lot at stake for MSFT in convincing its customers to upgrade.

If you want to put that Windows 8 adoption rate in context, look at the performance of Apple (AAPL) with OSX, the operating system powering its Macs and MacBooks. Windows 8 has been in release for well over a year and 8.1 has been available since October 2013.

When Apple released the latest version of OSX last fall, it was installed on 11.8% of all Macs within five days. At this point, OSX 10.9 is now on 37% of all Macs and combined with OSX 10.8 (released around the same time as Windows 8) accounts for nearly 60% of all Macs.

So yes, the 10% mark is a big milestone for Microsoft, and having 11.6% of your customer base on one of your two newest OS versions is a start — but MSFT has a long way to go before Windows 8 can be considered mainstream in the PC world.

Those XP holdouts in particular are costing Microsoft more than just the opportunity to sell a new copy of Windows 8. They’ve been costing the company money through more than a decade of security and service patches.

Microsoft insists it will cut off this security blanket in April, although there are rumors the company may back down on the ultimatum and continue to address critical issues going forward. It faces a public relations nightmare if PCs running its Windows operating system (even if it’s the outdated Window XP) become infected en masse in the spring, compromising consumers and business systems –Microsoft is going to face criticism and backlash over any resulting cyberattack catastrophes.

On the other hand, if Microsoft can spur a mass transition of those XP boxes to Windows 8.1, there’s considerable financial upside. There are nearly a half a billion XP users still out there; that’s a lot of possible Windows 8.1 copies to be sold — and once the PC owners have made that leap, they’re also going to have to buy a new copy of Office. And Office is one of MSFT’s most profitable products.


Article printed from InvestorPlace Media, http://investorplace.com/2014/01/windows-8-marketshare-10-msft/.

©2014 InvestorPlace Media, LLC

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