Monday, December 31, 2012

Rough year ahead for Microsoft and other 2013 tech predictions

Analysts predict tough going for Microsoft, Nokia, Hewlett-Packard and Research In Motion in the year ahead.

2013 tech industry predictions, part five: 

1. Bill Gates returns as Microsoft CEO after Steve Ballmer is ousted. 

CNBC predicts that Microsoft co-founder Bill Gates will return to lead the company after Steve Ballmer is shown the door.
“With Windows 8 a disaster, and the Surface tablet not close to meeting original internal projections, Steve Ballmer’s days at Microsoft in 2013 are ... over. The bigger surprise: Chairman Bill Gates returns as interim CEO in a last-ditch effort to do the impossible: re-engineer Microsoft to its former glory. Perhaps the only bright side: To keep investors engaged, Microsoft more than doubles its regular dividend.”

2. Windows 8 gets a quick overhaul. 

Veteran technology reporter and analyst Steve Wildstrom says Windows 8 will get an overhaul soon in response to consumer complaints about its new user interface.
“I expect that, at a minimum, Windows 8.1 (whatever it is really called) will give users of conventional PCs the ability to boot directly into Desktop mode, less need to ever use the Metro interface, and the return of some version of the Start button.”

3. Microsoft will make Office software for every platform. 

“2013 is going to be ugly” for Microsoft as it shifts to Windows 8, Forrester predicts. When PCs, tablets and smartphones are combined in a category called personal devices, Microsoft’s share of all operating systems has fallen from 95% in 2008 to 30% in 2012. And because Microsoft has little chance of gaining a large share of the smartphone and tablet markets, it will need make its Office productivity software for all the major platforms, Forrester says.
“Microsoft has to bite the bullet and rake in revenue from Office on every platform, not just Windows, and to a minor extent, (Mac) OS X,” Forrester says. “To remain relevant in a world where mobile devices outnumber PCs at least 2 to 1, the Office team will have to figure out ways to make Office equally accessible on Mac, iOS, Android devices, proprietary Android tablets, and the Web.”

4. Hewlett-Packard spins off its PC and printer business.

Before the end of 2013, HP will spin off its PC and printer business as it “makes a last-ditch effort to be like IBM,” CNBC says.
Silicon Valley entrepreneur Mark Rogowsky says calls to break up HP will grow louder in 2013, but HP CEO Meg Whitman will take other actions during the year.
HP will cut things like its Snapfish division, trim the number of PC models it makes by half and take another accounting charge, he says.

5. Nokia will split up and the parts will be sold off.

Nokia is “roadkill” in 2013, Rogowsky says. Its Windows-based Lumia phones will fail to get traction and spur a turnaround, so the company will be split up and sold off.
Nokia’s infrastructure division will be spun out. Its maps division will be sold to Apple. Its emerging-markets Asha line will find a home with a Chinese or Taiwanese partner. And Microsoft will buy some of Nokia’s smartphone division assets to build and launch its own branded Windows Phone handsets, Rogowsky says.

6. Netflix and Pandora will be acquired.

Apple is a likely buyer of both Netflix and Pandora, Rogowsky says. Apple will break its precedent of never doing large-scale deals, he says.
Netflix needs a capital infusion or a deep-pocketed buyer to meet its $5 billion in upcoming bills for streaming video content. Netflix CEO Reed Hastings will join Apple’s board, he says. (CCS Insight thinks Google will buy Netflix in 2013.)
Apple will pick up Pandora when it realizes it’s better to buy than build a streaming music business, Rogowsky says.

7. Microsoft will buy Zynga. 

Rogowsky believes Microsoft will buy online games company Zynga. Meanwhile, entrepreneur Dylan Collins believes Zynga will go private next year.

8. Dropbox, Square and Twitter will file for IPOs. 

“Recognizing that going public too late isn’t a plus, Dropbox, Square and Twitter will all file for IPOs in 2013 and each will command multibillion-dollar valuations, vindicating their expensive private rounds (two will be north of $500 million in revenues),” Rogowsky said. AirBnB “will be close to following the other three to market.”

9. Apple will come out with a smart wristwatch. 

Apple and Intel are jointly building a Bluetooth-equipped smart wristwatch that can connect to other iOS devices, most notably iPhone and iPod devices, The Next Web says. The Apple smartwatch could find its way to the market in the first half of 2013 and sport a 1.5-inch OLED display, the website says.

10. Microsoft will produce its own smartphone. 

Just as Microsoft decided to build its own PCs and tablets with Surface, the company is poised to build its own smartphone as well, says tech analyst Ben Bajarin. To do so, the software giant might acquire a company like Nokia or HTC, he says. “I believe Microsoft will officially get in the smartphone hardware game in 2013,” Bajarin said.
At the same time, Bajarin does not believe rumors that Amazon will come out with its own smartphone.

11. RIM will be acquired. 

Research In Motion will make a modest rebound in 2013 with the release of its BlackBerry 10 devices, Bajarin says. But to be competitive in the handheld market it will need help. Samsung could acquire RIM and make BB10 its proprietary OS if its Tizen OS doesn’t work out, Bajarin says.

12. Young people will abandon Facebook. 

“The stream of young people leaving Facebook becomes a flood as the middle-aged Gen X takeover becomes overwhelming,” blogger John W. Smart writes. “Facebook stock tanks. Then the Gen xers exit Facebook too.”

13. The driverless car becomes a serious initiative. 

Driverless cars, such as those backed by Google, will make substantial progress in 2013, says Strategic News Service publisher Mark Anderson. Multiple new states and countries will pass laws to allow robot-driven cars, he says. And major brands will undertake serious development of all the features necessary to make the technology commonplace.

14. Half of North Americans will own a tablet in 2013. 

By the end of 2013, at least half of all North Americans will own a tablet computer, says Joshua Bixby, president of Strangeloop.
“Currently, 29% of North Americans own some kind of tablet,” he said on Dec. 11. “With the proliferation of new inexpensive tablets, with the emergence of kids as a mostly untapped tablet market, and with Christmas just around the corner, I’m predicting that more than 50% of North Americans will own a tablet by year end.”

15. Smartphone viruses will proliferate in 2013. 

“2013 will be the year your smartphone gets infected with a virus,” Bixby said.
Security firm McAfee Labs says smartphones and tablets will become a larger focus for cybercriminals in 2013.
Symantec is predicting a rise in mobile adware, or “madware,” especially for Android devices.

16. More online companies will open retail shops. 

Rising vacancies in shopping malls and lower rents will prompt more e-commerce firms to give retail a try, says Howard Lindzon, co-founder and CEO of Stocktwits.
“Online commerce finally goes offline beyond Apple’s dominance,” Lindzon said. “Microsoft’s retail foray is one of the abominations of all time. It did not have to be so bad and in 2013, either Google or Amazon will make a much better attempt at a retail presence. My outside bets for the same attempt are Kayak, Intuit and Facebook.”

17. Chinese mobile phone vendors will become major players. 

Three of the top five mobile handset makers will be Chinese by the end of 2014, research firm Gartner says. ZTE, Huawei and Lenovo are looking outside China for growth.
Chinese telecom equipment vendor ZTE is already the No. 4 global smartphone vendor, as of Q3, and could become a top three global smartphone vendor soon, ISI Group says. Some of ZTE’s carrier-branded Android smartphones in the U.S. include the Sprint Flash and the T-Mobile Concord.

18. Nintendo’s Wii U console will flop. 

Nintendo’s next-generation video game console, the Wii U, will be a failure, says Dean Takahashi, lead writer for GamesBeat at VentureBeat. Initial supplies of the new game machine may sell out, but three to six months from now the novelty will wear off and gamers will await better-looking titles on the upcoming consoles from Sony and Microsoft or on the PC, he says.

19. Dish will merge with DirecTV or a telecom company. 

Satellite television broadcaster Dish Network will aggressively seek a merger with rival DirecTV in 2013, says Phillip Swann, president of If that doesn’t work out, Dish will join forces with a communications company such as Sprint, Verizon or AT&T, he says.

20. DirecTV will buy Netflix. 

If DirecTV and Dish don’t merge, DirecTV will buy online streaming video service Netflix, Swann says.

Photos: Microsoft Windows 8 and Surface tablet launch event in New York City on Oct. 25, 2012 (top). Nintendo Wii U video game console (bottom). 

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