News Column

New Year Won't Be A Happy One For Some Tech Companies

Jan 4, 2012

This year we'll see new video game machines, a new version of Windows and maybe even an Apple-branded television. But don't get your hopes up too high. My prediction is that those and several other eagerly anticipated tech products will prove disappointing.

Here's my forecast for some of the top tech duds for the year:

WINDOWS 8 WILL BE THE NEXT VISTA: The conventional wisdom about Microsoft's Windows operating system is that every other version is a winner, but the ones in between you generally want to avoid. Those latter versions usually introduce a major change in the way the operating system works or looks, while the others typically refine those changes and fix all the random bugs and problems they introduce.

That dynamic seems almost certain to play out again this year -- in spades -- when the company releases Windows 8, the successor to the popular Windows 7. The new version drastically changes the look-and-feel of Windows. With it, Microsoft is also pushing a big change in how developers write applications. And the software is being designed to run on both tablets and PCs, which is likely to result in a Frankenstein monster that works well on neither.

Look for companies and even consumers to hold out for Windows 9.

NEW GAME MACHINES GENERATE LITTLE BUZZ: Time was when the world would be abuzz at the prospect of a new game machine -- much less two. But those days have passed.

This year, Sony and Nintendo will debut the PlayStation Vita and the Wii U, respectively. My bet: The world will yawn. Sales of Nintendo's 3DS handheld -- the last new game device to hit store shelves -- were so disappointing that the company cut the price within six months.

And reports out of Japan indicate that after an initial flurry, sales of the Vita, which hit shelves there early, fell off a cliff.

Mainstream consumers have moved on to other ways to play, whether on smartphones or tablets or revitalized older machines, like Microsoft's Xbox 360.

TABLET TABLES TURN: Apple has had the tablet market basically to itself since it launched the iPad nearly two years ago. But thanks to Amazon, that's going to change. Its Kindle Fire tablet has been the giant e-tailer's best-selling item since the company unveiled it in September, and Amazon says it has sold "millions" of them. I'm betting that with its relatively low price and strong suite of software, the Fire's success has only just begun. And I think that's going to force Apple to respond.

Steve Jobs famously decried 7-inch screens such as the one the Fire uses, but Jobs is no longer around. Apple faces the prospect of losing its lead if it doesn't offer a 7-inch iPad.

SMARTPHONE RACE EFFECTIVELY ENDS: Some prominent analysts think the smartphone market will see a big shake up this year when Nokia starts shipping Windows Phone 7 devices to the United States and other markets. Some are predicting that within a few years, Windows Phone 7 devices will represent about 20 percent of the smartphone market.

I don't see it. In fact, I think the smartphone battle is largely won already and will be over by the end of the year. Google's Android, already the dominant smartphone operating system, will cement its lead.

Apple's iOS, which underlies the iPhone, will displace Nokia's Symbian as the distant No. 2 operating system. And everything else will fade away.

Nokia has already abandoned Symbian. Research In Motion has delayed the release of phones running its next-generation operating system, which will likely prove a fatal mistake. And even with Nokia's backing, Windows Phone 7 shows no signs of being anything but a bust. It might have been different if Nokia made it easy for its longtime Symbian customers to switch to Windows Phone 7. But it didn't, and they won't.

APPLE'S TELEVISION WILL BE A RATINGS DISASTER: The basic formula for Apple's success has been taking complex, niche products and turning them into mass-market ones by making them easy to use and, in recent years, competitively priced. That formula led to the iPod, the iPhone and the iPad. Apple appears ready to try it again with "smart" televisions -- those that are Internet-connected and can run applications.

Anyone who's tried one knows that smart TVs can be painfully difficult to use. I have little doubt that Apple can and will make things better. But I don't think it can price them competitively because TVs today are sold at or near cost, something Apple would be loath to do.

TVs aren't music players or phones. People buy them far less often, and few are going to junk their current TV for an Apple one, no matter how great it is.

What's more, price and size matter a lot more to consumers than features; few are going to spend potentially hundreds of dollars extra -- or trade down to a smaller set for the same price -- just to get Apple's special sauce.



Source: (c)2012 the San Jose Mercury News (San Jose, Calif.)


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