Latest Vista sales figures disappoint but Office a success
Microsoft has blamed disappointing Vista sales figures on the wrong type of computers. But revenues for Office continue to impress.
Though the money Microsoft takes in from its Client division (which is largely made up of Vista sales) is up 2% for the past three months compared with the same period last year, the rise is considerably below expectations.
What makes it particularly disappointing is that PC sales, which should drive Vista revenues (particularly with XP officially withdrawn), are up around 10-12%. The problem, according to Microsoft, is that most of this increase is in developing nations (where people are more likely to choose cheaper editions of Vista). There’s also a big trend towards cheaper computers, particularly NetBooks (cut-down laptops designed primarily for internet use), which simply can’t handle Vista’s requirements.
The effect is so significant that sales of Vista to PC manufacturers are actually slightly down; the small overall rise is thanks to corporate purchases and standalone boxed copy sales.
Microsoft’s financial head Chris Liddell said he expects the figures to rebound in the next quarter thanks to holiday season sales, with as much as 7-10% growth. Market analysts don’t share that confidence, and you do have to wonder how popular Vista-capable machines will be as a Christmas gift this year given the state of the worldwide economy.
The new figures may explain why Microsoft continues to allow loopholes for XP sales despite officially withdrawing it. With Apple sticking to a premium pricing strategy, Microsoft faces little competition in the cheaper computer market, but Vista (and almost certainly Windows 7 as well) doesn’t allow them to capitalize on this potential audience.
The good news for Microsoft is that sales in its Business division (traditionally driven by the Office package) are up 20%, with forecasts of continued strong sales for the next six months. Sales in the Server and Online divisions also rose significantly.
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