Is it "game over for Microsoft in consumer"?

Over on All About Microsoft my colleague Mary Jo Foley has posted market watcher Mark Anderson's 2010 predictions. One of those predictions is that 2010 will be game over time for Microsoft when it comes to the market.

Here's Anderson's prediction:

8. Microsoft loses in its Consumer play: except for gaming, it is Game Over for MS in Consumer. This will make Consumer the place to be, where the most robust and exciting change artists will work.

I don't agree with Anderson on this one, but I also don't disagree either. I don't think that 2010 will be "game over" year for Microsoft in the consumer market because the company still has several factors on its side. There's the +90% market share, the fact that its nearest rival, Apple, is still way behind with a single digit percentage share, and there's Windows 7 that will give Microsoft a boost for the next year or so.

That said, Microsoft has been losing its consumer market mojo for some years now. Part of this is down to price and the fact that Microsoft doesn't really want to cut pricing for consumers in any meaningful way. Sure, it's partial to the odd promotion or deal, but ultimately it's software pricing is stratospheric.

Then there's Microsoft cloud ambitions. Basically these have been scaled back to the point where there's nothing left to appeal to consumers, it's all business and enterprise.

Bottom line, the going's got tough for the Redmond giant and it's retreated back to business/enterprise and focused on delivering Windows/Office/Server products at as high a price as companies are willing to swallow.

I'm also curious as to why Anderson added that "except for gaming" caveat. That's interesting because Microsoft is also losing ground here. There are huge swathes of consumers out there who are sticking with Windows because Apple and Linux can't compete here. Problem is, game studios are increasingly moving away, or at the vest least shifting focus, from the PC and onto consoles for. Not only is it easier to develop for a console, it's also harder to customers to rip off your games. This is bad for Microsoft and the company needs to engage wit game studios to prevent this happening. Also, it can't focus too closely on consoles, because while it has dominance when it comes to the PC, games consoles are a different matter and it's a three-way grab between Microsoft, Sony and Nintendo.

So, while Microsoft is losing traction in the consumer market, 2010 won't see huge changes, just more of the same - gradual erosion.