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2013 will be the year that Microsoft becomes relevant once again. 

It will begin to use its dominant position on the desktop and in gaming to build an exciting ecosystem that will make Microsoft a compelling choice for consumers, and by extension an increasingly important advertising partner for marketers.

Studying trends is very useful when making predictions because a prediction in essence, should be the observation of a trend with the expectation that it will continue at a certain pace, to materially change the reality of the people who will live that change.

Within that context, we have the luxury this year of a number of observable trends:

  • Google’s market share of search dipped below 90% in the UK, its lowest point in five years, Microsoft’s Bing picking up the difference. (Source: Experian Hitwise)
  • The Apple iPad has seen its market share drop from 60% to 50% this year (Q3 2012), with devices from the likes of Samsung and Google making steady progress (Source: IDC )
  • 140% more Microsoft Mobile OS systems were shipped this year (Q3 2012) compared to last (Source :IDC)
  • Netflix’s market share grew, against analyst predictions that Amazon, Hulu and HBO Go would decimate it.
  • On mobile devices, it’s not Netflix but YouTube that dominates bandwidth usage (Google Play was 7th, followed by Netflix and iTunes -Source: Sandvine Inc).
  • In two-way communications, Microsoft’s Skype increased its market share of the instant messaging (IM) market, and now holds 83% of it with the absorption of Windows Live/Messenger (Source: Opswat)
  • On desktops, Google Chrome, Firefox, and Apple’s Safari all lost market share to Microsoft’s IE9 this year
  • Data so far suggests Microsoft’s Xbox will be the best selling games hardware of the year, aided by the release of Black Ops 2, Halo 4, and the securing of the third Skyrim expansion pack, ‘Dragonborn’, ahead of a PC or PS3 release.

For me, taken in aggregate, these trends suggest that Microsoft has been stealthy like a ninja, making significant inroads into its competitors businesses whilst the world’s gaze has been focussed on Apple, Facebook and Google over the last 12 months. 

In search...

Bing has for the first time eaten into Google’s UK dominance to a newsworthy degree. Whilst Google has made amazing progress against Apple in the world of devices (from 46.9% market share with Android to 68.1% this year, according to IDC).

Its core product,Search, hasn’t proved as resilient to Microsoft as everyone might have assumed. This trend is likely to continue due to Microsoft’s market gain in desktop browser usage; IE9 has increased its share of the browser market to 54% at everyone’s expense including Google’s.

With IE10 around the corner, preloaded into Windows 8, this puts Bing in front of even more people by default.

In devices...

In devices, Apple’s dominance is declining, with a very public assault from the likes of Google, Samsung, and Amazon. Lesser publicised is the 140% increase Microsoft has seen in the number of MS Mobile OS systems it has shipped this year compared to last (Source: IDC).

In fact, of all devices only Android and Microsoft has increased its market share this year.

In two-way communication...

Microsoft’s Skype is growing in dominance, largely due to Skype now absorbing Messenger/Live to give it an 83% market share (Source: Opswat).

Whilst IM has been waning in terms of usage, the new Skype will be part of all Microsoft products, including the lounge-owning Xbox, which means Microsoft is set to dominate two-way communications, which it will attempt to mirror on mobile.

In gaming...

The Xbox, located under 70m TVs in the US alone, gives Microsoft the opportunity to control people’s living rooms in a way that Google TV and Apple TV can only dream of.To put this in perspective, Xbox is in 26% of US homes, the iPad is in 15%.  

An even more interesting statistic is that the Xbox this year captured 28% of all non-PC/Mac video viewing versus the iPad's 27.1% (Source: FreeWheel).

Xbox advertising has grown by 142% since 2010 (Source: Microsoft/Ben Kuchera,The Penny Arcade Report).With the Xbox’s market share increasing and the iPads decreasing, the Xbox is increasingly looking like the next big thing for advertisers – I’d say it is the advertising worlds best kept secret right now.

Again, some stealthy ninja skills from Microsoft, carving out that market and now using it for advertising.

The Xbox 720 is scheduled for a release next year too, and it doesn’t take a crystal ball to predict that this will be a huge development. We already know that it will support an always-on power state and will utilise a chipset that can allow concurrent apps.

Add SmartGlass to this and you have the Xbox as a media (and  advertising) delivery mechanism in the home that is always on, feeding from and feeding into every other networked device.

There are already various clues around how Microsoft could compel people to accept being advertised to all the time too – for example, the Xbox 720 will likely go on sale for just $99 if you also sign up for a two year Xbox Live Subscription, i.e. opt-in advertising.

This looks likely as Microsoft is already trialling this with a specific 360 package today.

A potentially formidable ecosystem...

If you add up all these small victories, a strong case could be made that Microsoft has most of the ingredients necessary to build a great ecosystem for consumers, and the trends above suggest it might be on the right track.

It dominates the desktop and gaming domains, is using both of those to increase the advertising it can sell in search and display, whilst also getting ready to push its new mobile offering aggressively at an opportune time when Android has already weakened Apple, and there are questions that the latter may have lost its mojo.

There’s space for a third player in that market, particularly given the decline of Nokia and RIM.

Some of you will disagree and say that Microsoft can’t compete however much it tries because the only real strength it has on the desktop and given that the PC is dying, it cannot leverage the PC for much longer to push Bing via IE10, or use it as a compelling part of a wider ecosystem.

But whilst it’s fashionable to suggest that the PC is dead, the argument doesn’t stand up to reason, nor do any numbers support that view. In short, the PC will survive for a multitude of reasons – simple ergonomics (I have iPad RSI right now), large screens, storage levels, number crunching power, keyboards (far more valuable than we have given them credit for), and more.

In terms of numbers, the economic woes out there have had a bigger impact on PC sales than any questions over their utility – Lenovo for instance has seen an increase in sales this year by 23% (Source: Gartner).

The trend is not suggesting death at all. Don’t take my word for it – if we take a basket of search terms to represent desktop machines, e.g. ‘PC’, ‘desktop computer’, ‘laptop’, etc, and have Google plot their popularity as search terms over time, you get the graph below, which clearly shows that the demand for desktop machines has maintained, as opposed to suffering a certain free fall to its death as the media has led us to believe and we’ve blindly accepted without question:


Source: Google Trends

My prediction for 2013...

2013 will be the year that Microsoft becomes relevant once again. It will begin to use its dominant position on the desktop and in gaming to build an exciting ecosystem that will make Microsoft a compelling choice for consumers, and by extension an increasingly important advertising partner for marketers. It has all the ingredients, bar one, to make this possible.

The missing ingredient would be something like Netflix, which leads me on to my final prediction - Microsoft will buy Netflix in 2013.

Andreas Pouros

Published 28 November, 2012 by Andreas Pouros

Andreas Pouros is COO at Greenlight and a cotnributor to Econsultancy. You can connect with him on Google+.

15 more posts from this author

Comments (8)

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Ron Rodney

That's a pretty bold last statement.

But I wouldn’t say Microsoft has ever been irrelevant. What it’s been is a sleeping giant that's been poked so much by Google, Nintendo/PlayStation and Apple that it’s been forced to wake up and do something about it.

Netflix however isn’t bothering it so it won’t bother with them.

almost 4 years ago

Andrew McGarry

Andrew McGarry, Managing Director at McGarry Fashion

>the advertising worlds best kept secret

Xbox gamers who pay for Xbox Live Gold Membership DO NOT want to see ads. It's becoming one of the most common complaints by gamers because when you pay a premium, people expect not to see ads.

Forcing ads on premium membership gamers is not going to enhance the Xbox brand. It is damaging it. And as soon as companies become arrogant, they make mistakes. Look at how much marketshare SONY lost between PS2 and PS3.

The issue of ads on Xbox Live is not the rose-tinted revenue stream suggested here.

almost 4 years ago

Andreas Pouros

Andreas Pouros, Co-founder & COO at Greenlight

Hi Andrew - thanks for commenting. I agree with your point. My emphasis was more on the sheer number of eyeballs at Microsoft's disposal via the Xbox, less about their current execution of advertising to them. It's entirely feasible that new types of ad types may appear over time of course based on user feedback, etc, in the same way as Facebook advertising has evolved and is being engaged with far more now than even 12 months ago (we'll be publishing that research next month!).

almost 4 years ago



Typo - wrote by instead of buy

almost 4 years ago



Hahaha keep deleting my dissenting comment Stalin

almost 4 years ago


Deri Jones, CEO at SciVisum.co.uk


you quoted sources for some things..but not all.

You wrote:
> On desktops, Google Chrome, Firefox, and Apple’s Safari all lost market share to Microsoft’s IE9 this year

You did not say how many % MS had gained?

I researched at http://netmarketshare.com

Seems like IE went from 53% to 54% back in Q2 this year, and now in Q4 has dropped back to 53% (using a Qtrly chart.

What data source did you refer to?

Also you said
> 140% more Microsoft Mobile OS systems were shipped this year

But you didn't show the market share of Microsoft in the mobile market. It's tiny. 140% of tiny is still tiny!

Overall - this lack of accuracy/clarity makes you message sound like a bit of an MS fan-boy pitch !

Certainly as far as the web is concerned, you see to be overstating:
> making significant inroads ...

almost 4 years ago

Andreas Pouros

Andreas Pouros, Co-founder & COO at Greenlight

Hi Deri,

Many thanks for your comment. The crux of my argument is that these trends taken in aggregate suggest MS is doing better, but of course some of these trends may be very small taken in isolation.

Yes, IE's increase in market share was quite small, but everyone else's has dropped. Furthermore, IE9 hit 20% market share for the first time. The data is from NetMarketShare's October 2012 data (http://www.netmarketshare.com/browser-market-share.aspx?qprid=0&qpcustomd=0). It shows that IE usage has continued to rise, climbing half a point to 54.13% and is at its highest level since September 2011.

As for the MS Mobile market, yes their share is tiny, but they've only just launched their new OS, and there is very recent news about their launch of new devices, etc, so suggesting this might be an upward trend is I think quite reasonable.

Finally, I'm not an MS fan-boy by any definition - I in fact reluctantly decided that these trends were worthy of note!

almost 4 years ago


Deri Jones, CEO at SciVisum.co.uk


only time will tell if you're right to make the connection that 'some tiny changes' add up to a major one.

This Reuters news isn't helping:
"Microsoft Windows 8 makes lukewarm debut - Nov 29"

"Since the launch of Windows 8 on October 26, Windows laptop sales are down 24 percent, while desktop sales are down 9 percent compared with the same period last year, making an overall 21 percent dip, NPD Group said.

"Usually, a Microsoft release boosts PC sales because many consumers hold off purchases for several months so they can obtain the latest software immediately."

almost 4 years ago

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