* Windows 8, Surface tablet on sale at midnight
* CEO Ballmer sees Windows 8 recasting PC industry
* Windows 7 has sold 670 mln licenses-exec
NEW YORK, Oct 25 (Reuters) - Microsoft Corp
launched its new Windows 8 operating system and Surface tablet
on Thursday in a bid to revive interest in its flagship product
and regain ground lost to Apple Inc and Google Inc
in mobile computing.
"We've reimagined Windows and we've reimagined the whole PC
industry," Microsoft Chief Executive Steve Ballmer told Reuters
Television early Thursday ahead of the launch.
Windows 8 devices and the company's new Surface tablet,
which aims to challenge Apple's popular iPad head on, go on sale
at midnight on Thursday.
Steven Sinofsky, head of Microsoft's Windows unit and the
driving force behind Windows 8, opened the launch event in New
York in front about 1,000 media and PC industry partners.
He showed off Windows 8's new look, but stressed that the
system was built upon the base of Windows 7, Microsoft's
best-selling software that recently passed 670 million license
sales.
The new design of Windows, which dispenses with the Start
button and features square tiles for apps, may surprise some
users. Initial demand appeared solid, but customers were wary.
Early reviews of the Surface tablet were mixed, with praise
for its slick hardware, but concerns about battery life and
limited software and applications available.
"We've seen steady pre-order sales on Windows 8 devices from
early adopters," said Merle McIntosh, senior vice president of
product management at online electronics retailer Newegg.
"However, we expect that most average consumers are waiting
until after launch to make a purchase decision."
Investors were uncertain about the prospects for success of
Windows 8, but many feel a solid launch could help Microsoft's
stock, which has languished between $20 and $30 for much of the
last decade.
Apple's shares have significantly outperformed Microsoft's
over the past 10 years, and its market value is now more than
double Microsoft's. Microsoft was little changed at $27.87;
Apple fell 0.7 percent at $612.73.
"This really is about debunking the notion that Microsoft is
a dinosaur and they are relevant in a new climate of tablets and
mobile," said Todd Lowenstein, portfolio manager at HighMark
Capital Management, which holds Microsoft shares.
"Extreme pessimism and almost utter failure is priced into
the shares, so any kind of positive delivery on units, customer
perception, would be really beneficial to the stock."