Symantec Corp.

Analyst: Profit Sharing Should Be Microsoft’s Strategy For The Short Term

The little lull of the past few months gave way to another storm, as Microsoft has once again come under fire once again by analysts and market researchers regarding its newest operating system.

Ever since IDC revealed that Windows 8 has done nothing to encourage declining PC sales in the first quarter of the year, analysts have chipped in with their suggestions and recommendations.

A Gartner analyst (actually a research director at the firm) by the name of Ranjit Atwal believes that one of the easiest ways for Redmond to deal with Windows 8 criticism is a little concept called “profit sharing”. Talking to The Channel, he said:

“Microsoft and Intel continue to take the bulk of the profits out of the supply chain.

That was fine when the market was growing but will become incredibly difficult to swallow when times are changing – the whole of the PC industry is creaking.”

The notion that both Microsoft and Intel take away the bulk of the profits as the jingle their way to the bank is known to all. While hardware makers themselves are left to fight for scraps in the intensely competitive market.

For this reason both technology giants are collectively labeled as Wintel.

But times, as they say, are changing. The competition in the industry is getting fiercer — and sales are declining partly due to the fact that more and more consumers are migrating to tablets and smartphones as both mobile platforms attain impressive computational prowess.

It is for this reason the analyst believes that Microsoft could do very well to lend some hand to its partners by embracing the concept of profit sharing and supporting the recovery of the PC market in a much more direct way — at least for the short term.

What is your take on this? By all means join in the discussion.

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