iPad's Latest Threat To Windows? Retail SystemsiPad's Latest Threat To Windows? Retail Systems

Breakthrough Technologies For Retailing

Microsoft officials must be getting sick of looking over their shoulders at the iPad. Apple's suddenly ubiquitous tablet has already taken a big bite out of the market for traditional, Windows-powered personal computers and desktops. Now, it's threatening another key Redmond stronghold--the market for software that runs the gadgets retailers and hospitality merchants use to ring up sales, track inventory, and provide self-service kiosks to customers.

Microsoft currently holds about 87% of the market for so-called Point of Sale, or Point of Service, operating software. But retailers' desire to arm employees with mobile gadgets through which they can provide and receive customer information while, say, on a showroom floor, has them eyeing tablets.

"New mobile devices, inspired by the Apple iPad price point of $500, are a significant threat to the traditional POS market, particularly for specialty stores and hospitality establishments," said Greg Buzek, president of market research firm IHL Group, in a report. "Our recent research studies found that upwards of 50% of specialty retailers are looking to deploy handheld POS devices to replace many of their standard POS systems."

It's hardly surprising then that a number of independent software developers, like Square and Lecere Corporation, have produced iPad-based POS systems in recent months.

But Microsoft isn't standing still. This week the company released the latest edition of the version of Windows that's designed to run retail and hospitality devices. Windows Embedded POSReady 7 includes a number of features that will allow POS system developers to create mobile, interactive gadgets that give users an iPad like experience while maintaining integration with an organization's existing investment in back-end Microsoft business and server software.

POSReady 7 shares many attributes with its mainstream cousin, Windows 7, such as support for Windows Touch, Media Player 12, 64-bit CPUs, and security tools like AppLocker and BitLocker. It also connects to System Center Configuration Manager 2007 through an add-on, Windows Embedded Device Manager 2011. That means IT admins can manage all of their Windows devices, from servers to POS systems, through a single console. POSReady 7 also offers better power management tools than its predecessor, POSReady 2009, according to Microsoft.

To get the platform into the retail and hospitality markets, Microsoft is depending on a number of system vendors with a strong presence in those verticals, including HP, NEC, and Fujitsu. Microsoft has even partnered with IBM, a company with which it competes in most other segments of the IT market.

"Retail and hospitality organizations demand a high level of confidence when it comes to point-of-service operating systems. With the Windows Embedded POSReady 7 platform, IBM can support a broad range of next-generation in-store POS solutions that are retail optimized and deliver the power and reliability of Windows to customers," IBM retail executive Alan Outlaw said in a statement.

The stakes are high. The POS systems market is healthy, growing at 6.9% last year to $15.4 billion, according to IHL. And Windows Embedded likely accounts for a not insignificant portion of sales within Microsoft's $16 billion Server & Tools unit, though the company does not break out exact figures.

Windows 7 POSReady 7 is available to developers and system manufacturers through Microsoft's business and partner channels.

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