"First of all, price is a major issue," said Peter King, an analyst who focuses on tablets for U.K.-based Strategic Analytics, in a Thursday interview. "Clearly the market wants cheaper tablets. Everyone's ASPs [average selling prices] are declining, Android's most of all. Windows tablets' [ASPs] are too high."
Microsoft does plan on addressing price this year. "We are working closely with OEMs on a new suite of small touch devices powered by Windows," Klein said during an earnings call with Wall Street a week ago. "These devices will have competitive price points, partly enabled by our latest OEM offerings designed specifically for these smaller devices, and will be available in the coming months."
Analysts heard the line "latest OEM offerings designed specifically for these smaller devices," as confirmation that Microsoft will lower the price of Windows to computer and tablet makers, or provide rebates on their license purchases.
"When Microsoft conceived this [Windows 8 and Windows RT] project in 2010, tablet prices were high," said King. "But the world's changed very quickly. The trend is towards smaller, cheaper tablets."
Fewer than half of the tablets expected to ship in 2013 will sport screens larger than 8 inches, King said, echoing other forecasts by the likes of IDC.
Microsoft, in other words, aimed at quickly-disappearing target with its demand for 10-in. screens for Windows 8 and Windows RT devices, and now must scramble to shift gears.
Michael Cherry, an analyst with Directions on Microsoft, saw an alternative reason why Windows Blue, although perhaps welcome, isn't enough to markedly move the meter for Microsoft.
"Windows 8 sucks because Windows 8 apps suck," said Cherry, not mincing words. "And there's nothing in all these rumors of Windows Blue or Windows 8.1 that tells me that apps will be easier to write or that will result in better apps."
Microsoft's apps tally -- those touch-centric programs that run in Windows RT and in Windows 8's "Modern"-style UI -- are far behind that of those for Android and iOS tablets. More important, experts have said since the October 2012 launch of Windows 8, is the lack of high-quality, must-have apps necessary to make Microsoft-powered tablets or convertible device competitive with devices relying on rival operating systems.
Cherry strongly argued that until Microsoft can solve the apps problem, nothing else it does will really matter.