Why I Own Microsoft, Even After Windows 8

John is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.

The latest operating system from Microsoft (NASDAQ: MSFT) has had its share of detractors, including both those who have tried it and didn't like it and those who haven't tried it at all. I like Windows 8, I'm writing this post on a computer running Windows 8, but fear not--I come to bury Caesar, not to praise him. Whether history records the latest from Redmond as an innovation or a travesty, I'm not here to sell you on any of the Windows 8 talking points. Instead, I'm here to tell you why I'm holding on to my Microsoft shares even if history puts a big check in the "travesty" column.

While Windows currently holds the lion's share of the PC OS market, it's no secret that Apple (NASDAQ: AAPL) is one of the darlings of tech investors. Apple sells for hundreds of dollars per share, while Microsoft perpetually hovers around the $30 mark. The reason for this is a mix of innovation and marketing, with Apple offering a significantly larger range of products that appeal to consumers even if they don't own a computer running OS X. Buying an Apple product not only brings with it a high-quality electronic device, but also the so-called "Apple experience" that some describe when asked why they pay premium prices for Apple phones, media players, and computers. Even though some suggest that Apple's mystique might be fading a bit without Steve Jobs at the helm, there is still that undeniable Apple-ness to the company that Microsoft just doesn't have.

One thing that Microsoft does have, though, is consistency. I didn't use the word "perpetually" when describing Microsoft's stock value for nothing. Aside from a few dips and spikes, Microsoft has typically traded somewhere between $25 and $30 for a decade. The company's major peak was in 1999 when the tech bubble was growing, but even after the drop off from nearly $60 a share they've held fairly steady. Even as those critical of Windows 8 say that it could be the company's downfall, share prices still remain in that same range that they held during the years when Windows XP reigned supreme. Microsoft isn't going to hit $600 per share, but Microsoft stock is by and large consistent within around a $5 range.

It's also worth remembering that Windows isn't the only product that Microsoft gets by on these days. Office is another software powerhouse for the company, and with the launch of Office 15 (and the Office 365 Home Premium subscription service) right around the corner there's a good chance that it will help to offset sluggish Windows 8 sales and low Windows 8 upgrade prices. The company also has the Xbox line, which is also rumored to be due for a new generation within the next year or two. That will bring both hardware and games to help keep the larder full. And then there's mobile devices.

Trailing behind Apple and Google (NASDAQ: GOOG) in the mobile market, Microsoft is struggling to gain market share with Windows Phone and tablets running Windows RT and Windows 8. Competing in the mobile space is difficult because both Apple and Google are major forces there; both smartphone and tablet sales are growing significantly, and the vast majority run either iOS or some version of Android.

Microsoft doesn't have to take the number one spot to compete, though. They don't even have to be number two. According to Nielsen's figures, Windows Phone came in 4th place with only 2% of the market share as of Q3 2012. But when you consider that this represents a 50% increase for the Windows Phone since the previous quarter, and 2012 was the first year that smartphone usage outnumbered non-smartphone usage for the first time ever, a mere 2% market share is good news for the company. With solid support and quality phones like the latest Lumia phones from the Nokia (NYSE: NOK), a Windows Phone could reasonably overtake the Blackberry platform for the #3 position.

Speaking of Nokia, that's another thing that Microsoft has going for it: partnerships. The company does well to find partners that likely need Microsoft more than Microsoft needs them, allowing joint ventures to provide benefits to the company without putting it in a position of significant risk. I recently mentioned how Nokia managed to beat its internal projections due at least in part to the sales of Lumia phones; though it's a bit early to say that Nokia is making a turnaround. If it does well with its Windows 8 phones and the Windows RT tablet that it's supposedly unveiling in February, then this will have a definite positive impact not only on Nokia but on Microsoft's bottom line as well. Another example comes from Barnes & Noble's Nook.  Microsoft helped to finance the new subsidiary that focuses largely on the e-reader, giving it a small stake in B&N's best-selling product. Along those same lines, Microsoft has shown that it knows when to get out of a partnership that's headed south ,as it did when it sold its way out of the MSNBC partnership that no longer represented the company's viewpoints.

So in the end, I stick with Microsoft because while they're not the top player in tech they're still very much a player. They offer stability that can sometimes be hard to come by in a sector filled with ups, downs, and patent infringement lawsuits. When prices drop below $25 I know that it might be a good time to pick up additional shares because the price will likely go back up soon. When prices peak above $30 I know that it might be a good time to sell off some of my extra shares for a profit because prices are likely to settle back down. While I might revise my thinking on Microsoft's stocks in the future if the company starts to show a significant decline that it's unlikely to recover from, for now I remain fairly confident in its performance and will keep it in my portfolio.

Croaxleigh owns shares of Apple and Microsoft. The Motley Fool recommends Apple and Google. The Motley Fool owns shares of Apple, Google, and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Is this post wrong? Click here. Think you can do better? Join us and write your own!

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