“Microsoft is still not too late for the tablet party. And with its Next operating system closer than most expect, the software maker could corner meaningful market share in 2013 and beyond, Citigroup said,” Unnikrishnan Nair and Rachana Khanzode report for Reuters. “Microsoft could bring out a tablet-optimized version of Windows Next OS before it releases a PC version, the brokerage said in a note to clients. Citigroup analysts expect the beta version of the operating system by September and shipping to start between January 2012 and March 2013.”
“However, Citigroup was not convinced the product will be a raving success, adding that the overwhelming investor sentiment is Windows Next will not improve Microsoft’s position in the consumer devices market,” Khanzode report. “Apple Inc shipped roughly 15 million iPads in 2010, accounting for nearly the total tablet market, Citigroup said.”
‘Microsoft can have a meaningful share of the market in 2013 and beyond. Of course this is dependent upon the company’s ability to deliver a competitive operating system on partner hardware that is priced competitively,’ Citigroup said. Microsoft would have the enterprise market in its favor if tablets pick up with business users, as these customers are accustomed to Windows devices.”
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Tiernan Ray reports for Barron’s, “Caris & Co. analyst Sandeep Aggarwal this morning reiterates a Buy rating on shares of Microsoft , writing that a sooner-than-expected introduction of a Windows-based tablet from Redmond could be a catalyst for the stock… ‘We believe that the company has made big strides over the past 6 months and may end-up launching tablet soon.’ It’s understandable if Microsoft was late to the game, writes Aggarwal, given a likely reluctance to cannibalize its own PC Windows sales, says Aggarwal.”
Ray reports, “But once Microsoft does decide to offer Windows for tablets, they have the advantage, he thinks, in that, ‘unlike mobile devices, computing devices including tablets have higher switching costs in favor of Microsoft (familiarity of Windows & other computing products) and Microsoft can prevail even if it is a late entrant.'”
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MacDailyNews Take: Citigroup is right to be skeptical and, from the sound of it, Aggarwal has very little, if any, meaningful understanding of tablets like iPad and, therefore, doesn’t understand the tablet market much at all.