Do or die: Windows RT decision looms for new Microsoft leadership

With Windows RT causing a nearly billion-dollar write-off, Microsoft's new Operating Systems group leader must make tough choices

While the Microsoft marketing band plays on in spite of Windows RT's epic fail, Microsoft's new Operating Systems group, led by longtime Microsoft Exchange honcho Terry Myerson, faces an impossible juggling act. How can he keep pouring money and resources into a product that nobody wants to work on, very few people use, and customers rarely consider without a smirk? The pressure has only gone up now that Microsoft today revealed it had to write off $900 million -- yes, nearly a billion dollars -- because no one is buying the Surface RT tablets.

If you've been following my posts, you've watched the inexorable cratering of the Windows RT brand. Analyst claims from earlier this year that Microsoft had sold 900,000 Surface RT tablets in the fourth quarter of last year were all wet. I'm seeing numbers all over the place now, but I'd be shocked if more than 500,000 Windows RT tablets are in use -- in the sense that someone paid for the tablet, didn't return it, and powers it on more than once a week.

You've also no doubt heard about the steep discounts Microsoft gave, at first to select groups and now to anybody. You can get a 32GB Surface RT for $349 -- which may sound like a bargain to some, but it's still not even close to competitive. Yesterday, Lenovo announced it wasn't going to sell its Yoga 11 Windows RT hybrid online any more, and the crumbs could be found at some retail outlets.

It looks like Nokia won't build a Windows RT tablet. Samsung bailed in January. HP won't do it. Dell would, but Dell has problems of its own.

By my count that leaves exactly one viable Windows RT device on the market -- the Surface RT -- and it's a tragedy.

Of course, Microsoft will release a new version of the Surface RT before Christmas. (Will it be called the Surface 8.1 RT? Surface RT 2? R2D2?) It'll have a faster ARM chip -- maybe as fast as the next iPad. It'll have a much better display, though likely not as good as the iPad's Retina. It'll have a price tag that's considerably more than the next Nexus's. It'll have a stubbed-finger rendition of Office, including Outlook for Magnifying Glasses. And it'll probably sell as well as the current Surface RT 1.

That much is predictable; it's undoubtedly been in the cards for many months.

Here's the unpredictable part: How long will Microsoft in general -- and Terry Myerson in particular -- pursue this modern-day version of the old IBM OS/2? The price and performance delta between Intel/AMD chips and ARM designs is narrowing. Windows Phone 9 might make the leap to tablets, borrowing yet another page from Apple. I, for one, think it would be a step in the right direction, particularly if Microsoft gives us back the old Windows and lets it slowly fade away.

With Myerson well versed in Windows Phone internals, it's very hard for me to imagine that he has any stomach at all for continuing Windows RT -- good money after bad and all that.

Julie Larson-Green may well have a different take on the matter. During her stint as head of the Windows engineering effort, she was (at least externally) a big supporter of Windows RT. Now, with her portfolio shifted to hardware, she may want something to fill the gap between phone and Windows 8.1 tablet, at least for the immediate future, which puts the ball in Myerson's court.

This will be fun to watch.

This story, "Do or die: Windows RT decision looms for new Microsoft leadership," was originally published at Get the first word on what the important tech news really means with the InfoWorld Tech Watch blog. For the latest developments in business technology news, follow on Twitter.

Copyright © 2013 IDG Communications, Inc.