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Microsoft Admits Outlook for Vista is Bleak

Microsoft Admits Outlook for Vista is Bleak

by , 2:50 PM EDT, October 24th, 2008

Microsoft's quarterly earnings call with Wall Street told the tale of two diverging franchises: MS Office is doing well, but Vista growth was just 2 percent, and the company acknowledged that Vista's future is bleak for the rest of 2008, according to Computerworld on Friday.

The mere 2 percent growth, with revenues of US$4.22B, concerned analyst Matt Rosoff. "That fell pretty far short of Microsoft's expectations. That's always a worry, since it's the core of the company's business."

Worse, the most recent quarter was the second of three that saw Vista sales grow poorly or shrink, noted CW's Eric Lai.

The reason was attributed to the zooming sales of low-cost PCs, particularly netbooks, which MS has allowed to have Windows XP installed to combat Linux. Or if Vista is installed, it's a low cost, stripped down version of Vista that's compatible with the hardware. That's not very profitable for Microsoft.

Microsoft hopes that the holiday season will turn things around. "We think, particularly with Christmas coming up, that overall sales will be relatively good," said Microsoft CFO Chris Liddell during the earnings call.

Apple has been hammering home the problems with Vista and the fact that Microsoft is spending a lot of money to promote Vista rather than fixing its problems.

Microsoft's hope now is that during the holiday season, with the economy in turmoil, customers will buy the expensive PC hardware needed to make Vista sales surge and generate better profits.

Earlier in the week, at a Gartner symposium, Steve Ballmer suggested that customers migrate to Vista now but that Windows 7 would be "a lot better." With corporations taking 12-18 months to roll out a compatible successor to Windows XP and struggling with Vista, Mr. Ballmer's advice likely left them gasping for breath.

Observer Comments

Show: Subjects Only | Full Comments
Close Name:Guest
Subject: Christmas?

"We think, particularly with Christmas coming up, that overall sales will be relatively good"

Wow, could you imagine racing to the tree christmas morning, tearing open the wrapping paper in excitement, and finding Microsoft Vista!?!?

I would think that I was bad, and that's Santa's new version of coal!!

Close Name:Terrin Posts: 414 Joined: 29 Jan 2006
Subject:

I am willing to beat that Apple's Snow Leopard strategy is partly based on forcing Microsoft to come up with it's own ideas for Windows Seven. By showing developer's Snow Leopard, which is light on visible features, Microsoft cannot do what it tried to do with Vista: namely try to borrow from Apple. It will have to release an OS based mostly on it's own efforts and perhaps a bit from borrowing from Leopard. However, after Windows 7 is released, Apple can release a more feature focused OS.

Close Name:Nemo Posts: 24 Joined: 28 Aug 2007
Subject: Cheap PC Hardware won't run Vista

The problem with hoping that sales of cheap PC hardware will increase sales of Vista is that cheap PC hardware can't run Vista or can't run it well. So the PC vendors have to sell Vista on modern and relatively expensive hardware, which means that PC capable of running Vista must compete with Apple's new family of MacBooks and the other new computers that Apple is likely to soon introduce. Those Macs have better graphics, better and higher-end components, design that is superior in function and aesthetics, are aggressively priced, and, last but not least, run OS X.

Close Name:Guest
Subject: Thoughts on Christmas

I think the hopes on the Christmas season are mostly relying on the purchase of new computers, rather than the purchase of a copy of Vista.

With the state of the economy, that may not be a wise bet.

Better off buying a Mac ... my PowerMac G4 is still running strong after 6 years ... still hoping to be able to move to current hardware. We'll see what Christmas holds

Close Name:Guest
Subject: April, not December

I think Microsoft would be better focusing on April 1st.

- Honey, look I bought you Vista
- What!?
- Just kidding. Here's a Macbook.

Close Name:calebcar Posts: 26 Joined: 26 Nov 2007
Subject: Microsoft Admits Outlook for Vista is Bleak

MS Office is doing well, but Vista growth was just 2 percent.

What happens when everyone who is tight on cash realizes that they can get 80+ % of what's on MS Office for free with OpenOffice.

Can anyone with MS Office who has downloaded and used OpenOffice tell me what I'm missing?

Close Name:podman Posts: 174 Joined: 14 Feb 2003
Subject: Office

Sales of MS office are doing well. I probably would not have purchased the latest version of office, but after what Ballmer said about emasculating office for Mac. They will Never get another dime from me. I would love to see a Mac users boycott of Microsoft.

Close Name:xmattingly Posts: 266 Joined: 31 Jul 2007
Subject:

Quote
podman wrote:
Sales of MS office are doing well. I probably would not have purchased the latest version of office, but after what Ballmer said about emasculating office for Mac.
Count me in. Anyone who sounds like his intent is to deliberately hamper his customer base does not deserve their business.

Close Name:xmattingly Posts: 266 Joined: 31 Jul 2007
Subject:

Quote
Nemo wrote:
cheap PC hardware can't run Vista or can't run it well.
Which is probably a large part of the reasoning behind Jobs saying that Apple will not ship a $500 piece of junk: they know better.

Close Name:Guest
Subject: MS Office

Quote
podman wrote:
Sales of MS office are doing well. I probably would not have purchased the latest version of office, but after what Ballmer said about emasculating office for Mac. They will Never get another dime from me. I would love to see a Mac users boycott of Microsoft.


that is why MS office is the only pirated piece of software on my machine

Close Name:ctopher Posts: 134 Joined: 25 Aug 2006
Subject: Outlook for Vista?

I have Outlook for Windows 2000 and it's pretty bleak too!

Close Name:Guest
Subject: from the MAC OBSERVER!?!?

Anyone take a look at the trends, though slow, an inverse relationship to those using vista, to those no longer using XP?!?! With Vista now 20% of the total market?
http://marketshare.hitslink.com/report.aspx?qprid=11

And the almost negligible growth of OSX?


Oops looks like mactards dont like facts or honesty.

Close Name:Tiger Posts: 1018 Joined: 17 Jun 2003
Subject: fixed the headline

Microsoft Admits Outlook and Vista are Blech!

Close Name:Tiger Posts: 1018 Joined: 17 Jun 2003
Subject: negligible growth

Here's negligible growth for you.

2.6m Macs shipped in the September quarter, a 21% y/y improvement. The quarter ended with three to four weeks of channel inventory.

21% IMPROVEMENT

The only other thing getting 21% are credit cards.

Close Name:Intruder -   TMO Mac Specialist Posts: 3149 Joined: 07 Jul 2004
Subject:

Mactards? What are you, like 12?

With Vista being out nearly 2 years, only 20% is pretty dismal. It is not displacing XP at anywhere near the rate that Microsoft wanted (or expected, I'd bet). And it is Microsoft that has expressed disappointment in the uptake. That has nothing to do with Mac users.

Crawl back under your bridge, troll.

Close Name:Terrin Posts: 414 Joined: 29 Jan 2006
Subject:

Except for the fact that Microsoft Office 2008 eliminated Macros, I still think it is the best Office suite out there. It is expensive, but it is much better organized then the competition. The latest update was nice.

Unfortunately, I think Office 2007 for Windows is even better. I wouldn't pay for either though.

Close Name:Guest
Subject: What you are missing

VBA. Duh.

Close Name:Guest
Subject: Looking at your link . . .

. . . Market share for browsers by operating systems. First off trying to determine if market share is growing by looking at browser statistics is somewhat an exercise in futility, however, since you brought it up here is what your chart says.

Windows market share in Nov 2007 90.53%, OS X market share in Nov 2007 6.81%. Windows market share in Sept 2008 88.89%, OS X market share in Sept 2008 8.23%. For a net loss of 1.64% for Windows and a net gain of 1.42% for OS X.

Now how is this supposed to show that Microsoft is doing great?

Close Name:tiny_defensor Posts: 10 Joined: 31 Aug 2007
Subject: You should be looking at this

Quote
Guest wrote:
Anyone take a look at the trends, though slow, an inverse relationship to those using vista, to those no longer using XP?!?! With Vista now 20% of the total market?
http://marketshare.hitslink.com/report.aspx?qprid=11

And the almost negligible growth of OSX?


Oops looks like mactards dont like facts or honesty.


The chart you are quoting shows absolute marketshare. Of course we know what that is like. You should be looking at whether shares are growing or eroding. In which case, you should be looking at this:

http://marketshare.hitslink.com/report.aspx?qprid=9

This shows you a trendline for how marketshares are changing ver time. Guess who went from 92.43% to 90.29%? Guess who went from 6.8% to 8.23%? Looks like most of the mojo lost by one OS went to the other. That is what you call an inverse relationship buster.

The chart you quoted dodesn't show a trend. It was just illustration a situation at points in time.

But your attempts at FUD are noteworthy.

Close Name:tiny_defensor Posts: 10 Joined: 31 Aug 2007
Subject: Me? Miss VBA?

Quote
Guest wrote:
VBA. Duh.


I would not touch VBA if it were encrusted with diamonds.

Close Name:Guest
Subject: Screw VBA.. I want the diamonds!

In this economy, I would...

Close Name:Guest
Subject: ya, that's telling them

"that is why MS office is the only pirated piece of software on my machine "

That's really telling them. You just keep using their product to create files in a closed and proprietary format. Make sure you judge all office products (free or pay) by your pirated Office software.

Let me ask a question. What do you do that requires you to steal software? Can OpenOffice not do everything you need?

Close Name:Guest
Subject: no more vista

So, I converted to PC back at 8088/8086 from Apple 2e and yes I had a Franklin too. Two weeks ago I picked up this little gem MacBook Pro because I needed to see what OS X was up to. Since that day I have removed all PC's from my home and now run Mac Pro with Fusion as well. I hated Vista and now with my Intel MAC's I can't think of a single reason to use a PC. With fusion I just load (cough) XP for the apps that I have not found yet on Mac.

Vista will die a slow death. (Casts his rose into the grave)

Long live Apple, keep the prices on hardware comparable and MS will go away too. My only complaint is the heat this MacBook puts out with graphic intense apps. (cook an egg anyone)

Close Name:Guest
Subject: No, it cannot

OpenOffice absolutely cannot replace the real thing for all users. As an attorney most of my documents and those I receive from others are on "pleading paper", specially formatted documents with numbering running vertically in the left margin that courts use to cite specific language from a case. Take a pleading document written in Word or WordPerfect and open in OpenOffice, and you will be rewarded with a jumbled mess and have the privilege of wasting large amounts of time to correct.

I use a Mac with Word 2008. I also use Parallels with Windows 2000 and Word 2000, WordPerfect 12 and WordPerfect 6. Word for Mac handles about 85% of the documents I get without any formatting issues, but when the import fails, I immediately switch to a similar version of the actual application.

Likewise, courts often list their submission requirements including which word processor format. Create a document in a different program and use an export converter and you will make an enemy of that court clerk, if you don't just have your submission rejected outright.

OpenOffice is fine for a person or business that either doesn't deal with complex formatting at all, or who just doesn't need to exchange electronic documents with other people who don't use OpenOffice. For the rest of the world however, MS Word and to a lesser extent in the legal field WordPerfect are still very much required.

Close Name:Guest
Subject: How does this work?

"with the economy in turmoil, customers will buy the expensive PC hardware needed to make Vista sales surge and generate better profits."

If the economy is in a turmoil, why the HELL would they expect people to buy more EXPENSIVE hard ware? Hello... Turmoil=no $
What kind of asses are running the Redmond office?

Close Name:Hengemasta Posts: 25 Joined: 18 Sep 2008
Subject:

Quote
podman wrote:
Sales of MS office are doing well. I probably would not have purchased the latest version of office, but after what Ballmer said about emasculating office for Mac. They will Never get another dime from me. I would love to see a Mac users boycott of Microsoft.


I'm already there... no more of my money to them. I've even deleted my copy of MS RDC 2.0, and it was free! I think I'm even gonna put Solaris on my XP machine...

Close Name:Guest
Subject: Can OpenOffice not do everything you need?

No, but Pages can. Pages is great-it is lovely to use, and it is absolutely, completely MS Office compatible. It preserves and re-encodes MS formatting like an absolute champ, and it's a fraction of the price of MS Office. I love it. Maybe it won't fill in for every user with its feature set, but MS Office was kicked to the curb in my business this year and I haven't missed it.

Frankly, for me, the GUI for Open Office still isn't quite there yet, and I'm sorry, not trying to be a jerk, but the open nature of it and similar programs (this means you GIMP) do make for a less coherent and cohesive package. Sometimes development guidelines are a GOOD thing. It is an intriguing piece of software though, I haven't given up on it, and any alternative to Microsoft's offerings are A-OK with me.

Close Name:JonGl Posts: 113 Joined: 12 Jan 2006
Subject:

Quote
Guest wrote:

Frankly, for me, the GUI for Open Office still isn't quite there yet, and I'm sorry, not trying to be a jerk, but the open nature of it and similar programs


Have you tried OOo 3? I installed it on my Wind under OSX, because my copy of Word is the Word X for PPC, and I just didn't want to muck with trying to install it, only to not have it work---so I downloaded and installed the latest beta of OOo 3, and was quite surprised. It's not Nisus, but it is quite nice. I don't know how the latest Word looks and acts, but OOo3 is lightyears ahead of Word X (2001). Lightyears.

-Jon

Close Name:xmattingly Posts: 266 Joined: 31 Jul 2007
Subject:

Quote
Intruder wrote:
With Vista being out nearly 2 years, only 20% is pretty dismal.
Regarding that "supposed" 20% market share: I think it's also important to note that it includes brand new computers w/ Vista pre-installed, and does not take into account whether those computers have been purchased. So who knows what the real user base is? I would wager that the number is substantially less than 20%; especially considering stagnant PC sales these days.

Close Name:Guest
Subject: Yuppie

I checked out the latest MBP's today. How come Microsoft Word 2008, running native on the latest 2.4 GHz MBP's is slower than Word 2004 running under Rosetta on a 2.16 GHz Mac? Since I'm one of the majority of Word users that only use the basic features, why would I bother to go to Word 2008. I find that Word 2004 does me fine.

Close Name:Guest
Subject:

Quote
podman wrote:
Sales of MS office are doing well. I probably would not have purchased the latest version of office, but after what Ballmer said about emasculating office for Mac. They will Never get another dime from me. I would love to see a Mac users boycott of Microsoft.


MS has a way of abusing their customers to the point that when they are given a viable choice, they often take it. Office pricing gives that same old MS taste in my mouth that their OS once did.

I have switched to iWork for my documents.

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