As a hype-generating product, Windows peaked in 1995. I was a reporter for CNBC then, and the story was all over the news. I must have done a dozen live shots from Redmond that day. It was as big as a tech story could get.

Fast forward to 2012, and the launch of Windows 8 is a much more muted affair. Windows is no longer the center of the IT universe. An October 2012 report from Forrester Research, Inc.,  entitled “Windows: The Next Five Years” (membership/fee required) big changes for the legendary Windows ecosystem. The big takeaways:

  • Microsoft’s share on personal device OS has declined from 95% to 30% with the explosion in mobile devices.
  • Forrester thinks that Windows 8 will be a success, but it will move slowly, taking hold in 2014.
  • The PC Industry is changing from selling devices to “selling personal cloud services.” Microsoft needs to bring customers along in this transition.

It’s much more than a new look and feel. Author Frank Gillett writes, “The new Windows 8 user experience (UX) and programming model will transform the Windows experience for end users and for IT organizations.” The shift away from a PC centered universe has been obvious, but Gillett makes another important observation: a big shift from device-centric to service-centric solutions.

Forrester says that the new smartphone, laptop, and PC markets will shift dramatically. Smartphones sales will increase to $1.2 billion globally. Forrester estimates that Microsoft will gain about 27% share of the 2016 tablet market and it will still retain 90% of the 2016 PC market.’

In response, Microsoft is transforming the Windows ecosystem, focusing the OS on a touch-based interface, introducing a new technology to develop apps, WinRT,  rolling out a new app store model for distributing software, and venturing alone into hardware with the new Surface tabet.

Gillett thinks it will take a while to see if the new efforts pay off. He brings up a surprising point: OEM partners are expressing concern about the ability of Microsoft’s mighty marketing machine to message and position windows. Gillett calls for a slower-than-usual uptake for Windows 8, with the OS upgrade not taking hold until 2014.