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Windows Blue: Briefing On The Next Windows Platform

Tickers in this article: GOOG MSFT NOK

Chris Lau, Kapitall Contributor: Shortly after Windows Phone 7 was released, Microsoft (MSFT) quickly said it would be replaced with Windows Phone 8 (“WP8”). On a job posting as reported by Engadget, Microsoft is "getting ready for our next release targeting the holiday of this year." Codenamed Windows Blue, a successor to WP8 makes strategic sense. Microsoft is re-designing its core interface, as illustrated by tiles on WP7/8 and on Windows 8. The company logo was refreshed. [More Analysis from Chris Lau: Google Reader Shutdown Creates Opportunities for These 3 Companies]

The sweeping changes across all Microsoft platforms are a shift that could alienate the user base, but it makes strategic sense. Adoption for Windows 7 was slow, as users hesitated to move from Windows XP. The uptake for Windows 8 was even slower. By unifying the platforms under a single umbrella, Microsoft simplifies the platform for developers and increases brand and usability recognition.

Another benefit of unifying the brand is the ability to share data across all platforms. SkyDrive and Outlook.com are examples of this implementation.

Other expected changes include improvements to the user experience, new version releases for Internet Explorer, Calendar, Bing, and Mail.

Analysis:

On the PC side, a weak start for sales of Windows 8 is disappointing for investors. The slow unit sales are especially disconcerting because the upgrade offer price was very low. On mobile, “Blue” shows that Microsoft is moving forward by innovating.

Unifying the platform is a necessary and logical move for Microsoft. Google’s (GOOG) online offerings (Gmail, Docs, Drive) are all integrated on the web. They are all easily available on mobile Android-based devices. Nokia (NOK) will benefit from any improvements to the Windows Phone platform. Shares are down in 2013, while Microsoft shares are flat. Google is up significantly so far.

Chart

So far, investors are rewarding Google with a higher share price this year:

Windows 8 and WP8 both need a few things well before Blue is released:

  • Notification Centre
  • WP8 touch-gestures in Windows 8, such as hold-touching to bring up menus and options
  • Windows 8 “Back” and “Forward” swipe on WP8 web browser

Written by Chris Lau, Kapitall Contributor