Australian resellers capitalise despite slow growth of Vista

Previous CRN reports indicate that Vista received a luke warm reception in America and sales were still slow a month after its US launch. At the time customers did not see the benefits of upgrading to Vista from XP, particularly in the SMB sector.

Local resellers have reported that a year later they are still experiencing problems when selling the product. Meng Wei, owner of IT retail store PC Market, said when customers with small businesses buy a new machine - that comes pre-loaded with Vista, they have been asking for their operating system to be downgraded to Windows XP.

“Downgrading from Vista is very popular in our store. People complain to us that they don’t like Vista and want XP for their operating system. Some vendors like Fujitsu provide downgrade CDs, but it becomes harder with other vendors, because a few of them don’t provide drivers for XP,” he said.
According to Wei the need for downgrading gives the reseller the opportunity to use that to their advantage and “pretty much advertise it as an additional service.”

Tex Sylaprany, store manager of Capital Computers said they have also had customers coming in and requesting downloads. “We have a lot of those [downgrades], it is just that customers feel their current programs aren’t compatible with the Vista operating system,” he said.

“That is one of the main reasons why SMBs are reluctant to use Vista,” said Santana Khoupongsy, sales manager of TX Computer Solutions. The reseller charges $80 to downgrade the machine and supply a recovery CD so the computer can be restored to Vista with the necessary drivers in the future.

“The reason most corporate customers and business clients don’t want Vista is because it’s not compatible with their in-house applications like business accounting software,” said Khoupongsy. “Depending on the complexity of an organisation’s accounting software, it can cost our clients any ware from $1000 to $100,000, to update the software to be compatible with Vista,” he said.

According to independent analyst firm, IDC, Microsoft was always unsure of how the SME sector would react to the new operating system.

“The average consumer has Vista pre loaded on to their machine and has little reason to change their operating system. The commercial sector was always expected to have a slow start, especially at the enterprise end. SME however was the interesting sector to watch and they have shown the most resistance to Vista and a preference for XP,” said Liam Gunson, senior analyst A/NZ PC hardware, IDC.

Gunson believes there are very few reasons for organisations to move across to Vista, as most would have to replace their machines with newer PCs.

“Microsoft’s XP Pro is performing adequately and businesses can’t really see the extra benefits in changing and having to upgrade machines with slightly higher specs. Microsoft are aware of this and it has even extended its deadline for sales of new direct OEM PCs with XP installed (from 31 January 2008 to 30 June 2008),” he said.

According to Gunson the slow growth has been a natural progression where operating systems are concerned.

“It could be that most customers are waiting for the arrival of an upgraded edition of Vista, Service Pack 1. This is often the case in the marketplace, where customers will wait until Service Pack 1 comes out to make a move,” he said.

An end-users reluctance to move to Vista is a natural progression, there were issues in end-users moving from moving 2000 to XP, it will eventually happen, said Gunson.

With the XP coming off the market in another half a year people will have no choice but to stick with Vista on new machines.

For Microsoft, there is the fear that end users will turn their backs on Windows OS and try Linux or pirated software, said Gunson.

“Although the uptake is varying in the consumer, enterprise and SMB sector, the majority of end-users will eventually move across to Vista and we potentially see that happening early next in 2009, although there will be strong growth throughout 2008,” he said.

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