When Microsoft (Nasdaq: MSFT ) yesterday announced that its first month of sales of the new Vista operating system outsold the old XP system over the same stretch of time, I was hardly surprised. We knew in January that there were billions in preorders.
But is the Vista sales report really as good as Mr. Softy would have you believe? An analyst from researcher Gartner expressed doubts in an interview with the Associated Press yesterday. Let's review.
First the facts: Microsoft said it sold 20 million copies of Vista in February versus 17 million copies of XP in its first two months on the market in 2001. The AP reports that Mr. Softy's figures include copies ordered by PC partners such as Dell (Nasdaq: DELL ) and Hewlett-Packard (NYSE HPQ) as well as those obtained via downloads and retail stores. Also included were copies promised to those who bought XP-powered PCs over the holidays.
But that wasn't enough to impress Gartner analyst Michael Silver. He says that consumer sales of PCs have nearly doubled in the five years since the launch of XP. Vista, therefore, should be expected to produce higher sales -- perhaps much higher sales -- than its predecessor.
What's more, Silver expects that Microsoft's report includes a holiday backlog that could equal as many as 15 million copies of Vista sold as promised upgrades to those who purchased XP-powered PCs as holiday gifts. Dell, for its part, told the AP that two-thirds of its holiday purchasers registered for the Vista upgrade.
Expect Apple (Nasdaq: AAPL ) enthusiasts to make hay of that. It's entirely possible that Vista upgrades aren't selling as well as their Windows predecessors on an absolute basis, leaving room to wonder whether more users are turning to the Mac. But I wouldn't go there yet. After all, reports of a slow uptake for Vista are nothing new. And let's remember: Windows is a cash cow. Upgrades are typically milked over years.
Even Silver knows that. And that's why, last month, he told the IT-Enquirer website that Apple shouldn't view the forthcoming Leopard operating system as an opportunity to court business users that typically use Windows. Instead, he wrote, the iEmpire should continue to emphasize its strengths in entertainment and niche applications.
Good idea. Vista may be off to a slow start but, over the long haul, that's likely to mean very little for either Apple or Microsoft.
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Fool contributor Tim Beyers, who is ranked 1,329 out of more than 25,000 in our Motley Fool CAPS investor-intelligence database, runs Mac OS X and Windows on his MacBook Pro. He'll upgrade to Vista eventually. Tim didn't own shares in any of the companies mentioned in this article at the time of publication. Dell and Microsoft areInside Valuepicks. Dell is also aStock Advisorrecommendation. The Motley Fool's disclosure policy often wonders how a company nicknamed Mr. Softy can lead such a hard life.