RedmondMag: Windows XP Just Too Good, Harming Vista

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Vista could mark a turning point for Microsoft. It could be the Microsoftis first OS that suffers on the sales side because its predecessor works so well, according to RedmondMag.

Keith Ward noted that even though Microsoft has touted Vistais success, "lately, evidence has begun to mount that Vista isnit selling like hotcakes, and itis due in part to satisfaction with XP."

RedmondMag.com is the "independent voice of the Microsoft community."

"The latest, and most striking, indication of XPis continued strength, and Vistais softness, was given by Microsoft CFO Chris Liddell during a conference call last Friday to discuss the companyis Q4 earnings. While trumpeting Microsoftis first-ever year of gross income topping the $50 billion mark, Liddell also said that the company changed its forecast of revenue from its desktop OSes in Fiscal Year 2008, revising Vistais revenue down from 85 percent to 78 percent, and XPis revenue up from 15 percent to 22 percent," Mr. Ward observed.

Market research backs up the observation. "The release of Microsoft Windows Vista operating system at the end of January has, so far, failed to stimulate the market in the way many hoped," George Shiffler, research director for Gartneris Client Platforms Markets Group, stated in a recent press release. "Our market data suggest Vista has had very limited impact on PC demand or replacement activity. We donit see Vista having a significant effect on these going forward unless Microsoft becomes much more aggressive in its marketing efforts."

Yet another punctuation of the effect has been Dellis decision to re-offer XP after first deleting it as an option after Vista debuted. "We heard you loud and clear on bringing the Windows XP option back to our Dell consumer PC offerings," Dell said.

"With each [new] version of Windows, it gets harder and harder to find features and improvements that will drive upgrades," said analyst Matt Rosoff of independent research company Directions on Microsoft.

The bottom line is that Windows XP has been out for five years. It works well enough for most people. All the drivers are there. Vista is better but not compelling above the hood. The customer momentum has remained hard to overcome, and Microsoft has had to revise their Vista projections downward.

Apple has been successful in the past with this kind of OS migration, and about two thirds of Appleis customers are currently using Tiger on their Macs according to Steve Jobs at WWDC 2007. Even so, itis an issue for any OS vendor, and perhaps Apple elected to learn from Vistais debut so they donit make the same mistakes.

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