The final version of Windows 8 made its public debut, at long last, at a press event Thursday at Pier 57 in New York City. Appropriate for the touchy-feely nature of the operating system, Microsoft set up a bundle of demo stations around a model city design and let attendees go to town.
Microsoft bigwigs including CEO Steve Ballmer and President Steven Sinofsky anchored the keynote formally announcing Windows 8, flanked by a range of notebooks, all-in-one desktops, and convertible tablet/PC hybrids. Microsoft put special emphasis on the portable and convertible models, including the 13-inch Lenovo IdeaPad Yoga.
In the demo room, Microsoft avoided arranging the units by brand, which is the way we’ve become accustomed to seeing them at each individual company’s Windows 8 hardware launch. Instead, the display was more holistic, with a few brands represented at categorical tables (“tablet,” “all-in-one,” “ultrabook,” etc.). Companies including Dell, HP, Acer, and Lenovo were represented in the display.
During Apple’s fourth quarter earnings call today, CEO Tim Cook explained the company’s pricing philosophy for the iPad mini in some detail. The following is a portion of our rough transcript:
When we set out to build it, we didn’t set out to build a small, cheap tablet. We set out to build a smaller iPad that offered the full iPad experience. The difference between us and the competition is profound. 35% larger screen than 7″ tablets. 2 great cameras. Fastest communications with dual bank Wi-Fi. Fit and finish of our precision enclosure is breathtaking when held in your hands. That’s what we’ve done, the iPad mini has higher costs and gross margin is significantly below our corporate average. Height of the cost curve, but we want to make a large number and we’re going to work to try to get down the cost curve and get more efficient with manufacturing as we’ve done with our other products.
One of the things we try to do is to create a product that people will love for months and years and continue using. That’s what iPad Mini is designed to do. You can see that more broadly on iPad by looking at the usage statistics. Over 90% of web traffic from tablets is from iPads. Apple will not make a product that somebody may feel good about for the moment, but then won’t use when they get home. That’s not the experience we want our customers to have. I would encourage you to use an iPad mini and I don’t think you’d be using anything other than an iPad once you do that.
Europe is a key market for Apple. Last quarter it remained the second-highest revenue generating region after the U.S. Yet it’s an increasingly challenging market, yielding the lowest growth of any region for Cupertino in its Q3. And for smartphones at least, it’s also a market firmly in thrall to Google’s Android OS (not that Apple would put it that way). In its Q4 earnings today, Apple reported total revenues of $8,023 billion in Europe for Q4, down three percent on the previous quarter. Total revenues in the region were up eight percent year-on-year, but sales of Macs were down three percent.
The iPhone 5 launched in the U.S. during Apple’s Q4 — but Apple does not break out iPhone (or iPad) sales by region. Cook also noted that: ”We launched iPhone 5 in the US during the quarter, and while we launched in some international countries in the bulk of the world we did not launch in and so I would have expect to have seen more significant growth in the US vs the rest of the world.”
In contrast to tough times in Europe, Cook lauded a “really phenomenal” quarter in China during the Q4 earnings call, with full year revenue $22.8bn — up over $10bn year-on-year. He said Greater China “now represents about 15 percent of Apple for the fiscal year”.
In its Q3 earnings, Cupertino blamed the tough macro-economic situation in Europe for softening demand for its products and leading to “essentially flat” sales — indeed, it blamed the region for a rare miss against Wall Street expectations in Q3, along with speculation about forthcoming products (ie the iPhone 5). France, Greece and Italy were singled out as being “particularly poor” during the quarter, while Germany saw “only single digital positive growth” in Q3. The U.K. bucked the trend, delivering “solid” 13 percent growth.
Google’s Android OS is making life increasingly difficult for Apple in Europe. In its most recent report from September, market research firm Kantar Worldpanel ComTech (KWC), which tracks 12-week smartphone buying patterns, reported that Android had increased its share in Europe by a fifth (20.2 percent) in the past year — to gain more than two-thirds of the smartphone market. Android OEMs such as Samsung have driven sales by building phones with larger screen sizes than the iPhone, such as the Galaxy Note and the Galaxy SIII. KWC noted that 29 percent of the Android devices sold in the 12 weeks prior to its report had a screen size of more than 4.5 inches.
During its fiscal Q4 Apple launched an iPhone with a larger screen — 4 inches vs 3.5 inches — and announced a smaller version of its iPad tablet as it seeks to squeeze demand for Android phablets.
In additional European Apple news, the company appears to have quietly raised the price of App Store apps in select European countries. TheNextWeb is reporting it has shifted the base price of apps from €0.79 to €0.89 in countries including Belgium, Italy, Denmark and the Netherlands. We’ve reached out to Apple for comment on the price rise and will update this story with any response.
[Image: C.G.P. Grey]
Microsoft has reversed a controversial decision that created a strange gap between which games would be allowed on the digital Windows 8 Store in America and which would be allowed on its European counterpart, thanks to a discrepancy in the way those regions’ ratings boards handle similar games.
Originally, Microsoft planned to have the Windows 8 Store block games that received an ESRB rating of Adults Only (AO) in the US or a PEGI 18 rating in Europe (such Windows 8 games could still be bought at retail, or from digital services like Steam, but not from Microsoft’s official digital store). This plan ended up being much more restrictive on the European version of the store, though, because the top-level 18 rating covers a wide range of games that would only merit a Mature (M) rating in North America. Titles ranging from Dishonored and Doom 3 to Serious Sam 3, Bioshock, and hundreds of others would have been perfectly allowable on the US Windows 8 store, but not in Europe.
Today, Microsoft announced that it would be reversing that decision, allowing PEGI 18 games that also received a Mature rating from the ESRB in its store. Games that receive an AO rating from the ESRB will still be banned from the store in both regions, but very few games merit such a rating, and the ones that do are usually better classified as straight up pornography than real games.