Microsoft's CES no-show: Epic fail or epic foresight?

Microsoft's CES no-show: Epic fail or epic foresight?

For the first time in what seems like forever, Microsoft's ubiquitous centerpiece booth and opening night keynote are missing from CES.

It should've been awkward. This year's CES is the first show since Microsoft's amicable split with the Consumer Electronics Association. Redmond severed deep ties, giving up an annual booth in a marquee floor spot, and sidelining the dynamic duo of Ballmer and Gates, who had warmed up the crowd at 15 of the past 18 opening keynotes. Going in to this year's show, we expected the ambiance to match that first uncomfortable Thanksgiving dinner after your parents get divorced.

Boy, were we wrong. Or rather, tales of Microsoft's departure have been greatly exaggerated--though the company's reduced presence may just be a sign of things to come for CES.

A non-conspicuous absence

The HiSense booth occupying the front-and-center position once held by Microsoft's mammoth displays may stick out like a sore thumb to longtime attendees, but if you manage to overlook that, you'd almost swear Microsoft is still the belle of the CES ball.

Steve Ballmer put in a surprise appearance at Qualcomm's opening keynote, passing the metaphorical torch. Ballmer talked up ARM-powered Windows devices with his usual exuberance, while Windows CFO/CMO Tami Reller took the stage at a JP Morgan Tech Forum to announce that the company has sold 60 million Windows 8 licenses to date. She didn't reveal how many of those licenses have landed in the laps of actual users, but those are the first hard(ish) adoption numbers Microsoft has provided since Window's 8's one-month mark.

More importantly, Microsoft's manufacturing partners have been busy waving the Windows 8 flag with vigor.

Lenovo, Asus, Vizio, Samsung, Acer and others unveiled dozens of new Windows 8 devices, many of which sport hybrid-style designs that blur the line between laptop and tablet (or desktop and tablet, in some cases). Razer officially announced the Windows 8-powered Razer Edge, a.k.a. the single most powerful and funky looking tablet we've ever seen. (Discrete graphics FTW!) Intel, the other half of the ages-old Wintel hegemony, showed off low-power processors that promise to boost the battery life of the next generation of Windows tablets and laptops alike--and announced that all Ultrabooks bearing next-gen Haswell CPUs also have to sport a Windows 8-friendly touchscreen display. Heck, Microsoft software even made major waves in the automotive section, thanks to the extensive promotion of Ford's SYNC, which prominently displayed Microsoft's branding.

"It's almost like they're here," Rob Enderle, principal analyst at the Enderle group. "I think the strategy to back away from this a little bit and let their partners carry the load has been a good one."

A missed opportunity?

Redmond's hardware partners may be picking up the slack gracefully, but at least one analyst feels Microsoft is missing a major opportunity to promote its new operating system, which has landed with more of a thud than a bang despite Tami Reller's license sales proclamation.

"The show would be complete with Microsoft here," says Patrick Moorhead, principal analyst at Moor Insights & Strategy. "I really think Microsoft has to continually show--and demonstrate to the industry--that Windows 8 is a growth platform and not a dying legacy platform. Instead, it was up to Intel and OEMs like Lenovo to tell that story." Moorhead also says that industry insiders haven't been negative about Microsoft's absence, however. "Actually, I haven't heard much (about Microsoft) at all."

A possible canary in the CES coal mine

Microsoft's decision to dump CES wasn't a shock, however. While the company's claim that "our product news milestones generally don't align with the show's January timing" certainly rings true, it's also safe to say that computing takes a big backseat to other industries at CES, where home electronics, appliances, and automotive trends capture a much larger spotlight.

Dell and HP have also decided to sit on the sidelines of CES 2013. Simply put, it appears as though some PC companies have concluded that their marketing dollars might be better spent at more tightly focused events with a more attractive signal-to-noise ratio. Did you know that CES keynote speech slots are sold to the highest bidder?

"Attending CES as an exhibitor--let alone drawing a splash at CES--involves spending a lot of money," says Wes Miller, an analyst at the independent Directions on Microsoft. "I think Microsoft emphasized it last year when they announced their change in agenda; they'd rather spend money building buzz and marketing on their own instead of trying to be heard over the din of CES."

Indeed, the biggest titans in the industry are no-shows across the board at the Consumer Electronics Show. Noticeably missing from these crowded halls are Apple, Google, Amazon, and Facebook, which all devote much more attention to crafting meticulously planned in-house events and product announcements. (Facebook just announced one for January 15, in fact.) Microsoft's Surface tablet unveiling and the launch events for Windows 8 and Windows Phone 8 show the company swerving down a similarly monolithic path.

Chit-chat from OEMs who are actually at CES suggests that they may be holding back their big guns for February's Mobile World Conference in Barcelona, strengthening the theory that the glitziest electronic show on earth may not be the best place to announce flagship mobile or PC products. (Microsoft launched the first Windows 8 Consumer Preview at MWC 2012.) LG showed off an NFC-enabled washing machine, but said its new smartphones won't be unveiled until MWC. Likewise, Asus' somewhat lackluster CES booth is basically a placeholder in advance of a "huge" MWC for the company. Samsung uttered similar remarks to The Inquirer, explaining its decision to highlight fridges with Evernote integration rather than kick-ass mobile devices. So that's where all the smartphones have disappeared to!

While Microsoft may indeed be missing a high-profile opportunity to beat the Windows 8 drum firsthand, the company's partners are doing a bang-up job in its stead--and the fact that those same OEMs are holding back their own high-profile product announcements for more tightly focused events proves that Microsoft's absence at CES may just say more about the trade show's role going forward than it says about the absent software giant. CES ain't dying anytime soon, but it's no longer necessarily the premier event for the PC ecosystem. App-powered appliances, though--that's a different story.

For more blogs, stories, photos, and video from the nation's largest consumer electronics show, check out complete coverage of CES 2013 from PCWorld and TechHive.

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Tags Microsoftbusiness issuesCESWindows 8Consumer Electronics Association

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