More IT Shops Plan to Wait for Windows 7

Microsoft executives put their best face on Windows Vista sales at the company’s
annual financial analysts meeting Thursday when they presented their year-end results and
year-ahead plans to stock pickers.

However, despite selling some 180 million licenses for Vista to date, two new surveys
of IT decision makers paint a significantly bleaker picture of Vista’s near-term
prospects in the enterprise.

Translation, large-scale deployments may have to wait until Vista’s follow on release
— codenamed Windows 7 — ships a year and a half from now or so.

A six month survey of 50,000 users in 2,300 large to very large enterprises, released
this week by Forrester Research, found that even after Vista Service Pack 1 (SP1), only
8.8 percent of Windows users are running Vista so far. That compares unfavorably with
87.1 percent for Windows users running Windows XP.

In addition, this latest survey goes against a pre-SP1 survey that Forrester
late last year.

Other analysis firms have also been tracking sluggish uptake of Vista among corporate
customers lately, even after the first quarter’s release of SP1.

For instance, Sanford C. Bernstein & Co. reported in June that “a year of
overwhelmingly bad publicity, coupled with opportunities for continued XP ‘downgrades’ or
over Vista for Windows 7, look to have meaningfully eroded support for Vista
and are likely to impair the product’s overall adoption,” according to a copy of the
report obtained by the Seattle Post-Intelligencer.

That was seconded in June when analysis firm Computer Economics weighed in with early
results of its own poll. “The preliminary results from our annual IT staffing, spending,
and technology trends survey indicate that most organizations are still not including
Vista in their plans for 2008. Many are not even planning, as yet, for an eventual
migration,” the report stated.

Now, another new survey, released Tuesday by KACE Networks which commissioned the
report from King Research, reinforces Forrester’s latest report. The survey, a follow up
on a similar poll
last November, found that of 1,162 IT professionals queried in June 2008, 60 percent have
no plans to migrate to Vista. That’s up from 53 percent in November.

Additionally, 92 percent say the delivery of SP1 had no impact on deployment plans –
or lack of them.

It seems like a classic case of CEO Steve Ballmer’s mantra that Microsoft’s biggest
competitor is its own installed base coming true in spades. Still, it goes against what
has become common wisdom regarding new operating system releases over the past 10

Typically, corporate IT shops will hold off deploying, and often testing, a new
Windows release until Microsoft issues the first service pack – usually assuring that
early bugs are squashed and compatibility and device driver issues are resolved.

This time around, even though XP is nearly seven years old and getting very long in
the tooth, many shops appear to be sticking with the devil they know over the devil they

“The evidence that I’ve seen goes along with the Forrester report so far as Vista
adoption in the enterprise,” Charles King, principal analyst at Pund-IT, told

Some of the hesitancy may be driven by tighter IT budgets in a continuing uncertain
economic climate.

“I get a sense that people are holding their breath, that it’s not a time to go into
debt to buy new PCs,” said King, who has no relation to King Research. “Risk assessment,
at some point, is going to impact IT sales.”

“It seems to be more of a question of companies asking how much longer can we get
along with XP,” King added.

Whatever is causing it, the sluggish market for Vista has Microsoft brass running

“On the enterprise side … we saw a very strong acceleration post Service Pack
1. You saw those enterprises accelerating that deployment …. we’re seeing that
track very consistently with the deployment cycle we saw in enterprises around XP,” Bill
Veghte, senior vice president of the Windows Business Group, told analysts at Thursday’s

One feature of Vista that Microsoft has hammered in with users has been its emphasis
on security.

“Today, you have a platform and a product that is 62 percent more secure than what we
delivered in Windows XP SP2 and effectively the conversation with businesses and
consumers relative to the security of Windows is not an issue for us based on that,”
Veghte said.

However, despite – or perhaps, because of – increased security, there have been
continuing complaints that the system is sluggish and application incompatibilities
abound – points that analysts raised with CEO Ballmer at the meeting.

Windows 7, meantime, promises to be a significant update to Vista and will include a
system kernel that’s based on both Vista as well as Windows Server 2008. However, the
publicly stated
that rumors that Windows 7 would feature a new, much smaller kernel,
are unfounded.

Indeed, even Ballmer seems to recognize that many customers may wait for Windows

“It’s ‘Windows 7’ going to be quite compatible … and the design point is
compatible from the get-go in large measure,” Ballmer told the analysts.

Just assuaging financial analysts’ fears may not do the trick, however.

“I don’t know a single company that’s deployed Vista,” Rob Enderle, principal analyst
at the Enderle Group, told “The cost of migration in terms of
disruption ‘due to app incompatibilities’ has just been too high.”

Even analysts who see all of Vista’s warts, however, have to date recommended
not waiting
for Windows 7. That is, just because it’s coming doesn’t mean that
Windows 7 will be a panacea.

“I think an impressive number of folks in enterprises are going to hold onto XP until
Windows 7 comes out ‘but’ I don’t think that’s a good idea,” Enderle said.

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