Attendees at the Microsoft (NASDAQ: MSFT ) Build conference literally rushed
the floor of the Anaheim Convention Center on Tuesday after the company held its
press conference introducing the Windows 8 operating system. The blitz to the
show floor wasnt fueled purely by a desire to get some hands-on time with the
latest packed in version of Windows Solitaire, but curiosity about Microsofts
big gun at the show: Samsungs Windows 8 tablet PCs. Build wasnt the first time
the press had demoed the Series 7 Slate, but it was the first time it got an
extended experience of Windows 8 running on a tablet, and the reaction has been
favorable. Apple (NASDAQ: AAPL ) gave us a glimpse at what a post-PC operating
system might look like, and now Microsofts gone and pushed that idea to the
limit. (We) like what we see, wrote Christopher Trout at Engadget . Investors
dont appear to be quite as moved. On Wednesday, Microsoft was trading around $26
at midday after around 30 million shares were exchanged. Put another way, its
business as usual. CEO Steve Ballmer will hold court at Microsofts annual
Financial Analyst Meeting before the market closes Wednesday, but its unlikely
hell make any announcements that will cause the stock to see major action. Even
after months of speculation as to what Microsofts grand plans for the tablet
market are, the big reveal hasnt brought big changes, merely more expectations.
Positive press or not, Microsoft and its manufacturing partners still face what
appears to be an unstoppable market force in the form of Apples iPad when
Windows tablets start selling in the near future. Hewlett-Packard (NYSE: HPQ ),
Motorola (NYSE: MMI ), even MSFT partner Samsung (PINK: SSNLF ) all of them
have failed to dent the iPad market. Even with an impressive operating system
that can seamlessly blend a users experience on a work PC with their tablet,
theres no guarantee that Microsoft and Samsung will be able to penetrate
consumer infatuation with Apples device. As discussed in a Tuesday report
regarding GameStop s (NYSE: GME ) tablet plans , tablet makers have a shot at
finding a place in the one-sided market by specializing in niche audiences.
Where GameStop is looking to capture consumers by making tablets for the
high-spending, video game-playing crowd, Microsoft has the means to cater to
multiple specific audiences. The company has, of course, done this for years
with Windows and its other products like Microsoft Office. Windows Vista,
maligned as it was, was smartly released in a number of different editions, some
built for enterprises, some for consumers and others, like Windows Vista
Starter, custom-made for emerging markets. Office still is offered in packages
for businesses and students. If Microsoft can effectively develop and market its
Windows tablets to suit a similar range of audiences with different needs, and
especially different budgets, it stands a good chance of distinguishing itself
from Apple. How should it separate its different Windows tablets and Windows
editions from each other? Its likely Microsoft will take the same approach it
always has, offering certain tablets for professionals, others for students and
still more for the average consumer. If it wanted to get cagey, however,
Microsoft would try to design its line of Windows tablets to suit different age
groups. Private company LeapFrog Enterprises is releasing a $100 tablet aimed at
4- to 9-year-olds called the LeapPad Explorer. By going for that young a niche,
LeapFrog likely will avoid competition with Apple altogether. If Microsoft
really wanted to make a dent in the market, a series of aggressively priced
tablets aged at children, young adults and even seniors could make it happen.
Right now, Microsofts Windows 8 tablets are building good momentum, but that
wont be enough to win the market. Ballmer & Co. need to think around their
competition, not like them. As of this writing, Anthony John Agnello did not own
a position in any of the stocks named here. Follow him on Twitter at
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