The departure of Windows Chief Steven Sinofsky from Microsoft is another sign that the PC market is dying and the software company isn't needed in a computing market dominated by smartphones and tablets, said Dan Niles, senior portfolio manager at AlphaOne Capital Partners.
While Windows 8, the latest version of the Windows operating system spurred hope among some investors that Microsoft may be due for a comeback, the reality is the company was just too late to the game in the mobile market, Niles said.
"I think the thing is with Microsoft, they're really behind. They were behind in the transition to smartphones, they completely missed that. And they were behind in the transition to tablets," Niles said. "The problem with technology is when you come late to a party, you're really fighting from behind. And Apple has shown, you don't need Microsoft to get a good tablet experience. Google has shown through Android that you don't need it either."
Sinofsky, the former head of the Microsoft division that developed the Windows operating system, resigned from the company Monday night. Windows 8, which has an interface designed for touch-screen devices, was launched less than a month ago.
Microsoft and Intel dominate the PC market, but the PC market faces serious issues, Niles said. PC units this year will be down year-over-year for the first time since the technology bubble burst in 2000, signaling that mobile devices are killing the PC market, Niles said.
"The problem is, you look at tablets and smartphones, it's been pretty obvious for years now that you don't need either of those two companies for those products," Niles said.