The Operating System Wars: So Who Really Wants Windows 7?

August 4th, 2009

If you can believe some of the reviews out there, Windows 7 is all that Vista should have been. It’s fast, reliable and has a solid interface. However, when CNET’s own tests of the RTM (release to manufacturing) version failed to provide evidence of any significant speed improvement, other than the shut down process, you have to wonder what some of these people are smoking — or drinking — before they write their stories.

Or are they hoping to earn enough affiliate commissions and free gifts from Microsoft to compensate for shedding all vestiges of journalistic integrity? I don’t pretend to know.

Now I’m not saying Windows 7 is necessarily a bad operating system. When Vista came out, the hardware hadn’t quite caught up, so it was sluggish where XP was snappy. That was then and this is now. So Windows 7 need only be slightly faster than Vista in terms of impartial benchmarks to be perceived as a better performing product. The other initial Vista irritants, such as driver conflicts, have largely been resolved anyway.

As to the interface, it seems as if Microsoft is once again making changes for the sake of change, not efficiency or ease of use. The latter concept remains alien to them. Having a taskbar that resembles Mac OS X’s Dock might seem cool to them, but since the original was released back in 2001, it’s hardly a new idea.

The larger question is whether Windows 7 offers anything that would attract Microsoft’s huge roster of business customers to abandon XP and upgrade. I suppose security is probably better, although most enterprise users have already configured their networks to provide reasonably safe environments for XP. Perhaps they could keep things the same, other than requisite security software updates. You can bet they are already testing Windows 7, but the jury is still out how quickly they plan to embrace the new system. Certainly if large-scale purchases of new PCs are pending, they might be more amenable to staying with the new rather than retrofitting the old this time.

That would, of course, auger well for Microsoft, at least as far as the business world is concerned.

When it comes to home users, I suppose most people who buy new PCs will simply stick with the system that was preloaded. Only power users would care about reverting to XP, Linux, or an unofficial installation of Mac OS X. But it’s not as if PC sales are on hold pending the release of Windows 7. Microsoft doesn’t get that sort of buzz. This is not 1995, when people lined up around computer and electronic stores to have copies of Windows 95 placed in their greasy hands.

More to the point, despite the pathetic efforts at spin control from Microsoft’s lunatic CEO Steve Ballmer, Apple’s current success with Macs is not a “rounding error.” Just a few years ago, Apple managed to sell less than 800,000 units a quarter. Now it’s more than three times that high. Perhaps Ballmer has embraced some sort of new math where growth rates of 300% or more aren’t significant. But after Microsoft’s recent difficulties in sustaining decent sales, particularly in the consumer space, I hardly think they have a right to complain.

But the larger problem confronting Microsoft is that they have never been able to compete fairly. Using tricks, bait and switch and outright deceit, they carved for themselves a huge majority share of the PC operating system market. Of course, some stupid moves from Apple early on helped cement Microsoft’s dominant position.

These days, however, Apple is regarded as a significant competitor. Don’t forget that they have 91% of the U.S. retail market in sales of personal computers selling for over $1,000. Except for workstations and special purpose gaming PCs, the other makers are fighting desperately for market share with cheap boxes.

Even though music players aren’t as hot as they used to be, the iPod has essentially retained its extremely high share of the market. The iconic product gained ascendency in a relatively fair competitive environment, and Microsoft’s efforts fell flat. Ditto with smartphones, where the iPhone is competing with similarly priced and cheaper products, but has carved out a growing share far faster than the naysayers could ever have imagined.

This fall, Windows 7 will face competition with Apple’s Snow Leopard. Although Apple, as of the time this is written, had not yet begun to officially accept preorders, you can reserve a copy at Amazon (the link uses our affiliate code, so we can get a few cents commission if you place an order). What’s more, Snow Leopard quickly supplanted Windows 7 preorders in the sales charts, and you can hardly call Amazon a devout Mac supporter.

Of course, I may be dead wrong. I reserve that right. Perhaps Windows 7 will be Microsoft’s hoped for magic bullet, which will ignite PC sales all over again, as Windows 95 did 14 years ago. But I find that possibility very, very hard to accept.

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10 Responses to “The Operating System Wars: So Who Really Wants Windows 7?”

  1. DaveD says:

    Let me see. Microsoft’s main product is Windows. It took them over seven years to get an OS that is as good as XP. From what I am reading, XP is still faster than 7. Sounds like more code bloat. Their CEO, Steve Ballmer, is unusually focused on Apple instead of making their OS/Office mean and lean. With close to 90,000 employees, one wonders what they do with their time.

  2. Nice to see Snow Leopard appearing around the same time. Will invite some head-to-head competitions.

  3. Richard says:

    Do not look for corporate America to embrace Win 7 (or any other new OS for that matter) quickly.

    There is something very intimidating to IT departments about betting your job on something that has not been thoroughly tested by somebody else and proven to be reliable. Especially when the company is probably more or less content with the status quo…at least it is something familiar.

    The actual installed base of Vista users is much smaller than the figures M$ publishes because many corporate clients are forced to purchase new hardware with an OEM Vista installation (for which M$ receives compensation and counts on their “user meter”), but wipe the drive and install XP and whatever applications are needed under their site licenses.

    The problem with OS X remains that it is only available with Apple hardware which does not fit the needs of many businesses. They would also have to dispose of virtually all of their old hardware if they were to make the change to Apple hardware. The only way I think Apple is likely to make significant inroads into the business market is to offer the OS separately and then convince the customer that Apple’s hardware actually is better/more cost effective. Of course this would mean that Apple would have to change their hardware offerings to provide a greater range of choices. I believe that Apple is simply not interested in the business market and will therefore always be considered a niche OS company.

    So, to answer your question who will be interested in Windows 7, any small business without a huge IT department and corresponding site licenses. They will not have much choice. Consumers, on the other hand, are less constrained by these problems and are free to simply change platforms. How many will? Probably enough to keep Apple going, but not enough to “change the world”.

  4. David says:

    I certainly don’t want Windows 7, but I’m a Mac guy and I work in an Apple dominated company.

    Most consumers have no idea what version of Windows they have or use. They use whatever came with the computer and may have installed some of the updates available through Windows update, but that’s it. They’ll get and keep Windows 7 and we’ll all be a bit better off because of it. There will be fewer viruses, but probably even more worms and trojans because social engineering is always the best way into any system.

    Corporate IT departments are justifiably leery of everything that comes out of Redmond. They are slow to adopt new operating systems and site licensed software. Like Richard I believe almost all corporate Vista boxes have been wiped and loaded with XP.

    I believe Apple will continue to grow as a maker of Macs and handheld devices. There is still a lot of room to replace Windows boxes and dumb cell phones.

    There are Apple logos everywhere I look in this city. iPods continue to be everywhere and despite what some stats may show, continue to sell as well as ever. Sales have stopped growing and they account for less of Apple’s revenue than in recent years, but that’s only because the Mac and iPhone are doing so well. I see iPhones and/or iPod touches on the subway every day.

    Despite the obvious success of Macs in recent quarters I’m still amused by the 91% of computers over $1000 figure. Not only does that more or less leave out Dell entirely because their online store represents most of their sales, but it probably ignores all the small computer stores that assemble their own computers rather than stock brand names. Based on personal observations at people’s homes, the regional recycling center and elsewhere, I’d say 4 out of 5 desktop PCs in this city have no brand name on the case. That doesn’t mean that many of them cost more than US$1000, but without getting all the receipts there’s no way of knowing for sure.

  5. LCK says:

    “More to the point, despite the pathetic efforts at spin control from Microsoft’s lunatic CEO Steve Ballmer, Apple’s current success with Macs is not a “rounding error.” Just a few years ago, Apple managed to sell less than 800,000 units a quarter. Now it’s more than three times that high. Perhaps Ballmer has embraced some sort of new math where growth rates of 300% or more aren’t significant.”

    I think Ballmer meant that the Mac market share (not growth) is a “rounding error” if compared to MS. Notice he’s very careful to stick to market share, because if it was in terms of profitability, Apple would blow MS out of the water! With a (arguably) 5% of the market worldwide, Apple has… what… 60% of MS’ profitability?

  6. “… Apple… will therefore always be considered a niche OS company”

    By what measure? Probably the tired, old, almost meaningless “market share” idea. Currently, Apple’s worth is 70% of Microsoft’s. What do you think shareholders care about – market share or money?

  7. tom B says:

    @ LCK:
    Ballmer also said the iPhone would flop. He reminds me of some CEO’s I’ve had the displeasure of working for: big bucks; no brains. Notice Bill Gates got out about the time he knew the game was over. Apple shipped a UNIX-based OS (server) in 1999 and10.0 2001. MSFT has YET to ship anything approaching a 21st century, modern OS.

  8. Robert Lloyd says:

    Hi Gene,
    I’m sure MS will of course make some gains in sales but Apple will keep increasing its total marketshare. Next 2 years should see a push into the enterprise as Snow Leopard is so far advanced and beyond Win7 technologically that it now makes sense. PS:
    Auger means one thing and augur means something else. Nevertheless Gene, I love your charming site and everything you write about (for many years). Keep up the great work! –RL

  9. Louis Wheeler says:

    I keep saying the same thing: little will seem to change over the next year. It is only in looking back that we will see the ramifications.

    The Vista users have every reason to move to System Seven; the improvements in stability and security are enough to warrant the costs. But, they only comprise approximately 6% of the world computer market. This is over 60 million users, so Amazon will be busy for a while.

    The Windows 2000 computers (~3% of the world market) have little reason to change. So does a substantial portion (~25%) of the XP market. The reason is that these are machines which are not being used as computers, so they would not benefit from System Seven’s upgrade. They are used as Cash Registers, Displays and front ends to mainframes or the web. There is little reason to disturb them until the hardware breaks and it is too costly to fix. Soon enough, there will be very inexpensive, more powerful, desktop versions of the NetBooks, run by the Chrome OS, which can replace these aging machines.

    The rest of the XP market (~54%) is more questionable. Some of them are Gamers who will not benefit from going to System Seven. Others are Servers which should be moved out of Windows, altogether, into Linux or the Mac OS for improved security and lower cost over Windows, but probably won’t. It is easier to stay with XP in big companies. Some consumer XP users will try out Google’s Chrome OS when it comes out next year, others will be giving the Mac a try. The bulk of the XP users are in the Government and Big Business. They will likely hold off for a year to see how system seven does.

    Meanwhile, Apple will be busy moving to 64 bit apps, GCD and OpenCL. The trends of migrating toward the Mac from Windows will slightly increase, because XP users will be forced to do their homework and will find that the Mac OSX and its apps can do their tasks better. Apple will increase their share of the SMB market.

    The 64 bit, GCD and OpenCL enabled, apps will be gaining attention from being 50 to 200% faster than Windows apps on the same computer. Apple will solve their Content Delivery problems and will open up the Application Store to regular Mac Applications and Games, late next year. Developers from the iPhone App store will rush into the vacuum which is created. They are likely to price their apps low to gain maximum sales, since very few of their apps will be purloined. The numbers and complexity of Mac Apps will increase. As the variety expands, applications will be pushed into every niche which is currently Windows only. This will be especially true of Enterprise and Game applications.

    Of course, this will be denied and covered up by the Wintel pundits and the mainstream Media, but the word will leak out. The average Wintel user will be left out in the cold as he or she increasingly has to deal with system seven security issues. That will not change much.

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