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We're in the Tablet Age; Microsoft Is in the Stone Age

Stocks in this article: AAPL AMZN GOOG HPQ INTC MSFT

The need for a turnaround in the Microsoft Surface line has also become a sub-plot in that company's continuing search for a new CEO. Satya Nadella, who runs the company's Azure cloud, is now said to be the front-runner. But his appointment would answer no questions about the Surface, and Microsoft stock barely budged on the news.

The biggest irony in this story is that, now, Intel and Microsoft may actually be too late. IDC sees many tablet markets being saturated. Apple holds a third of the market, Samsung and Amazon together hold another 26% of it, and all the WinTel efforts are stuck in the leftover "other" category, which is declining in size. "Other" is now just 30% of the market.

While WinTel dithered, in other words, the market burned away. This is now a mature product category, and many of 2014's buyers will be looking at their second or third tablets. Apple's iOS and Google's Android operating systems dominate the space, software has followed that train out of the station, and we have reached the point in the market story where leadership is pretty well set.

There may be some hope for Intel in its Chrome-based designs, if they can compete on price as sold through Chinese manufacturers. There may be hope for Microsoft if it can make its tablets more cloud-based, in order to overcome its disadvantages in software.

But I was writing about hope in this market 20 years ago. Sadly, hope is all that WinTel has left.

At the time of publication, the author owned shares in AAPL and GOOG, but held no positions in any of the other stocks mentioned.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

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