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Slideshow Follow Reuters Facebook Twitter RSS YouTube Read White House told of militant claim two hours after Libya attack: emails 23 Oct 2012 UPDATE 4-U.S. sues Bank of America over 'Hustle' mortgage fraud 24 Oct 2012 Divorce in two countries is double the trouble 24 Oct 2012 Apple's Schiller defends iPad mini's price tag 23 Oct 2012 U.S. sues Bank of America over "Hustle" mortgage fraud 24 Oct 2012 Discussed 511 White House told of militant claim two hours after Libya attack: emails 149 After final debate, Obama says election comes down to trust 119 Obama talks Libya and Biden’s swimsuit on ”Daily Show” Sponsored Links Tech focus now on Microsoft Windows 8, Surface tablet Tweet Share this Email Print Related News EU warns Microsoft over new Windows 8 browser option Wed, Oct 24 2012 iPad mini won't upset low-end market: analysts Wed, Oct 24 2012 Apple unwraps mini-iPad to take on Amazon, Google Wed, Oct 24 2012 Microsoft's newest weapon in China piracy fight Tue, Oct 23 2012 Mobile revolution, economy trip up tech giants Fri, Oct 19 2012 Analysis & Opinion Apple in miniature Weekly Radar: Q3 earnings; China GDP; EU summit; US debate Related Topics Tech » Media » iPad » New Surface tablet computers by Microsoft are displayed at its unveiling in Los Angeles, California, June 18, 2012. Credit: Reuters/David McNew By Bill Rigby SEATTLE | Wed Oct 24, 2012 7:32pm EDT SEATTLE (Reuters) - Firm sales numbers for Microsoft Corp's Windows 8 and its new Surface tablet will not be available for three months, but it may be clear long before then if it has a hit on its hands. "We can definitely gauge it by chatter," said Emily Chan, an analyst at Bernstein Research. "There is a slight learning curve, so I don't think we will see that big pop that iPad saw." Microsoft is desperate for the new-look, touch-friendly Windows 8 to grip customers' imaginations, as it looks to regain ground lost to Apple Inc and Google Inc in mobile computing and shake up the moribund PC market. Perhaps more important is its new own-brand tablet called the Surface, available only through its own stores and website, which will challenge Apple's iPad head on. "I'd want to know the sales - and return rate - of the Surface," said Sarah Rotman Epps at tech research firm Forrester. "But those numbers will be hard to get since Microsoft is the only retailer." Early reviews of the Surface have been mixed, generally praising the slick hardware, but faulting battery life and the limited software and applications available. Some worry that the first Surface model, which runs on a stripped-down version of Windows 8 called RT that is not compatible with old Windows programs, will cause some confusion and dissatisfaction among customers. The three models for sale on Microsoft's U.S. website are already on back order, suggesting strong demand, but it is not known how many Surfaces Microsoft has manufactured. "The fact it's back ordered is indicative that there's consumer interest," said Michael Gartenberg, an analyst at tech research firm Gartner. "How Microsoft introduces it, evangelizes it and explains it will determine long term success." BALLMER NOISE Microsoft has not said if it will reveal sales figures for Windows 8 or of the Surface before its next scheduled earnings on January 24. The company tends to trumpet good news and stay silent otherwise. After the launch of Windows 7 three years ago, CEO Steve Ballmer waited only a month to announce strong sales. A year later, he waited only 10 days to report record-breaking sales of the Kinect, the motion-sensing add-on for the Xbox. But Microsoft has never shared the sales of Windows-powered phones, which have a lowly 3 percent of the market. If Ballmer stays silent about Windows 8 sales, it might indicate a less than stellar performance. "I would definitely take it a sign that it's not super, super strong, but I won't take it as something negative," said Chan at Bernstein, who is expecting 8.3 million Surface sales by the middle of next year. That averages out at about 1 million a month, a third the rate of the iPad, which notched up its first million sales in 28 days and has now sold more than 100 million units, averaging about 3.2 million a month. Gartner forecasts that Surface and other tablets running Windows RT will sell about 2.3 million units this year and 9.3 million next year, grabbing about 2 percent and 5 percent of the worldwide tablet market, respectively. DOOR-BUSTERS Retail activity will be closely watched. Microsoft will have more than 60 brick and mortar stores open for the release of Windows 8 on Friday, half of them 'pop-up' stores that will stay open for the holiday shopping season. Third-party retailers are cautiously optimistic. "We have seen pretty good response to our pre-orders for Windows 8," said Best Buy Co Inc spokesman Jeff Haydock. "Quite honestly, I don't know what to expect from Friday. I don't know if there will be lines or not. My sense is it will take some time for people to kind of come into the stores and check it out." Best Buy may give some color on how PC sales are going when it reports earnings on November 20. Wal-Mart Stores Inc, the No. 1 U.S. retailer, said U.S. pre-orders for Windows 8 PCs "have been better than expected." Online retailers Amazon.com Inc, Newegg Inc and TigerDirect Inc have been silent on Windows 8 pre-orders. The full impact of PC sales on retailers will not be evident until chains report same-store sales for November. QUICK REACTION One early indicator of Windows 8's success will be the contents of the online Windows Store. Microsoft has had a harder time drumming up interest among developers for Windows 8, given the risk that there will be fewer users than competing platforms. Microsoft will not disclose numbers, but there are expected to be 5,000 or so third-party apps available to U.S. users, in comparison with the iPad's 275,000. Some big names such as Facebook Inc will be missing. In social media, the tenor of comments on the Twitter hashtags #Windows8 and #Surface will give an indication of their reception after Ballmer unveils them both on Thursday. Many users likely will be shocked by the new design, which dispenses with the Start button and features square tiles for apps. "Public reaction to the new UI will depend how well Microsoft explains why 'different' is better and teaches how the new experience works," said Gartenberg. "That all starts on Thursday." BY THE NUMBERS The ultimate test for Windows 8 will be PC sales. Industry trackers are expecting a bump for PC sales in the last two months of the year, but not enough to rescue the whole year, which is forecast to dip for the first time since 2001. Some analysts had expected an uptick in production of laptops ahead of the Windows 8 launch, but PC makers facing an uncertain global economy have been wary about committing. Chip maker Intel Corp, which is a good gauge of future PC demand due to its position early in the production process, expects the PC business to grow at only half the normal seasonal rate in the fourth quarter. Chief Executive Paul Otellini recently told analysts he expects to have a better understanding of the success of Windows 8 in 90 days. Stephen Baker, an analyst at retail research firm NPD Group, is expecting a 10 percent jump in PC sales for November and December over last year, but said comparisons will be difficult given a profusion of new devices and the volatility of year-ago data. Fourth-quarter PC shipment numbers from research firms Gartner and IDC will not be published until early January, although analysts say PC makers might start to drop hints about demand before then. "There will likely be many milestones, but very few will ultimately be decisive. The key point is will PC sales continue to shrink or will they experience a boost," said Al Hilwa at research firm IDC. "We can probably begin to properly judge that with some ambiguity in January." (Additional reporting By Dhanya Skariachan in New York, Jessica Wohl in Chicago and Noel Randewich in San Francisco. Editing by Andre Grenon) Tech Media iPad Related Quotes and News Company Price Related News Tweet this Link this Share this Digg this Email Reprints We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/ Comments (3) yummy8755 wrote: Edition: U.S. Africa Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom Back to top Reuters.com Business Markets World Politics Technology Opinion Money Pictures Videos Site Index Legal Bankruptcy Law California Legal New York Legal Securities Law Support & Contact Support Corrections Connect with Reuters Twitter Facebook LinkedIn RSS Podcast Newsletters Mobile About Privacy Policy Terms of Use AdChoices Copyright Our Flagship financial information platform incorporating Reuters Insider An ultra-low latency infrastructure for electronic trading and data distribution A connected approach to governance, risk and compliance Our next generation legal research platform Our global tax workstation Thomsonreuters.com About Thomson Reuters Investor Relations Careers Contact Us Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests. NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.

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