Windows 7: Looking Back On A Pivotal Year For Microsoft

Over the summer, a number of surveys and studies by analysts put into question whether businesses that chose to stay with Microsoft-based infrastructure would rush to adopt Windows 7 or wait until later in 2010. A Forrester survey of 653 PC decision makers at North American and European enterprises and SMBs found that six out of 10 companies planned on moving directly to Windows 7, while 1 percent of respondents reported that they planned “to migrate from Windows to a different platform.”

However, another survey by ScriptLogic said six out of 10 companies would avoid purchasing Windows 7 upon its 22 October debut, with 34 percent planning to hold off on adoption until December 2010. A survey by Deutsche Bank suggested that Windows 7 could reach within 12 to 18 months the same market penetration rates as Vista and XP two years after release.

If Windows 7 fell flat on its face, metaphorically speaking, in the weeks following its release, then Microsoft would have had a substantial problem on its hands. The rise of Google Apps and other browser-based applications has led pundits throughout 2009 to declare that the age of cloud-based computing has truly arrived; within that context, the failure of Windows 7 would be perceived as the beginning of the end for the robust desktop model.

Microsoft was determined to not let that scenario play out, especially since roughly a third of its 2008 revenue – or around $20 billion (£12.5bn) – came from operating system sales. Throughout the summer, the company attempted to play up the variety of discounts and promotional offers tied into Windows 7, including plans to sell the new operating system for roughly 10 percent less than Vista, and make the platform widely available through Amazon.com, Best Buy and the online Microsoft store starting on 26 June.

On July 7, Microsoft also announced that it would sell a Windows 7 Family Pack, with three Windows 7 Home Premium licenses, for $149 (£92.73). Although Microsoft said the package would only be offered in limited quantities, some consumers held out hope that this was lip service; accordingly, when Microsoft pulled the Family Pack from sale on 7 December, the move was greeted with howls of derision.

During Microsoft’s Worldwide Partner Conference in New Orleans, which kicked off July 13, Ballmer suggested during a Q&A session that an industrywide tech refresh was inevitable.

“Even if you take the assumption that [the economy] won’t turn around for a long period of time,” Ballmer told the audience, “we’re building a pent-up demand for IT.”

That conference also saw Microsoft taking a more aggressive stance against rivals Apple and Google. During a July 15 speech, Microsoft Chief Operating Officer Kevin Turner said Microsoft’s then-new ad campaign, which focused on the supposed inexpensiveness of PCs when compared to Macs, was having an effect.

“Two weeks ago, we got a call from the Apple legal department saying, ‘Hey’ – this is a true story – saying, ‘Hey, you need to stop running those ads, we lowered our prices,'” Turner said during his speech. “I did cartwheels down the hallway. At first I said, ‘Is this a joke? Who are you?'”