--High expectations for Windows 8 boost Microsoft share price
--Windows 8 could shake up tablet market, now dominated by Apple
--Chief information officers "trust Microsoft more than they trust Apple" - magazine
By Benjamin Pimentel
Microsoft Corp.'s (MSFT) share gains Friday were partly due to high expectations around Windows 8, the new version of its operating system, which analysts see as the company's chance to shine in a fast-changing computing market.
Windows 8, which is expected to launch later this year, is supposed to offer dramatically enhanced features, including capabilities commonly found in smartphones and tablets--like being able to boot up instantly or navigating a screen with the touch of a finger.
It's expected to give a much-needed lift to the sluggish personal-computer market.
But analysts also see Windows 8 as Microsoft's shot at shaking up a fast-growing tablet market, especially in the highly lucrative corporate market.
"The industry is excited as they almost always are around an OS [operating system] launch," NPD analyst Stephen Baker said in an interview.
But the excitement is more pronounced this time, he added, partly because of changes in the market, highlighted by the rise of tablets and other mobile devices.
That shift has been dominated largely by Apple Inc. (AAPL), whose iPad kicked off the tablet revolution, and other devices based on Google Inc.'s (GOOG) Android operating system.
Microsoft has been viewed as sitting on the sidelines in this revolution. But that could change with Windows 8, analysts say.
"The Windows ecosystem is saying, 'This is our opportunity to kind of get back in the game,'" Baker said.
The game extends well beyond the consumer market and into corporate suites where Windows still dominates on desktops and laptops, but not on tablets.
Many businesses are still upgrading to Windows 7 on their desktop and laptop fleets, so the Windows 8 launch will not be a factor when it comes to those machines.
But it is when it comes to tablets.
Apple's iPad has made "major inroads" in the corporate market, said Tim Bajarin of Create Strategies Inc. Because Microsoft's applications, such as its Microsoft Word and Outlook, are widely used in businesses, there's some excitement about having more tablets that are more readily compatible with the software many companies use, he added.
"There's significant interest in Windows 8 tablets only because enterprises assume they will be compatible with existing Windows apps," Bajarin said.
Gary Beach, publisher emeritus of CIO Magazine, which is geared to chief information officers, called Windows 8 "the most important launch" for the company since Windows 3.0 was introduced in 1990.
IDC analyst Crawford Del Prete also said businesses are keen on having more choices when it comes to tablets.
"From what I hear, CIOs are looking forward to having this option in the marketplace," he said. "The expectations are very, very high for Microsoft."
The company can potentially meet these expectations with some recent trends in the market, said Gartner analyst Michael Silver.
One is that tablets based on Google's Android have not taken off as many expected. "We haven't seen a huge move toward Android, so Microsoft has some opportunity," he said.
Beach of CIO Magazine also said chief information officers "trust Microsoft more than they trust Apple."
"CIOs know that Microsoft cares about enterprise computing while Apple's business model is all about selling one device to one consumer at a time," he said in an email.
Still, there are some potential pitfalls for Microsoft.
Bajarin said how well Windows 8 devices will actually work with existing Microsoft programs being used by businesses is still unclear.
Beach of CIO Magazine also said the "popularity of the iPad remains high with CIOs."
Del Prete said Microsoft also must first win over consumers to Windows 8 given the trend in which employees increasingly bring their own devices to the workplace.
"Consumers have to fall in love with Windows 8 in order for them to bring these [devices] into the enterprise," he said.
The dramatic changes Microsoft is introducing to its flagship product with Windows 8 also could turn out to be a double-edged sword, Baker of NPD also argued.
"The PC guys are excited about this, but change is hard," he said. "I think everybody is worried that there's going to be too much change and users are going to be uncomfortable."
Late Friday, Microsoft's stock was at $32.42, up $1.41, or 4.6%.
-Benjamin Pimentel; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires 04-20-121617ET Copyright (c) 2012 Dow Jones & Company, Inc.
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