Analysts: Windows 7 could spur enterprise PC sales

A report will outline how the OS fixes problems businesses had with Vista

Windows 7 could inspire businesses to begin spending money on PC upgrades again because it repairs major problems enterprise users had with Vista when it was released nearly three years ago, analysts said this week.

The "Windows 7: An OS for Businesses" report from Directions on Microsoft, which will be released early next month, will outline how Windows 7 addresses concerns business users had with Vista, such as poor application compatibility, poor device-driver support, and other limitations, which could inspire companies to free up the money they need to upgrade to the new OS. The research firm this week released some analysis that will be in the soon-to-debut report, written by Directions on Microsoft analyst Mike Cherry with help from analysts Paul DeGroot and Matt Rosoff.

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Microsoft executives have acknowledged over the past year or so in public appearances that the company has made a concerted effort to address complaints business users in particular had with Vista. Many companies opted to skip Vista and wait for Windows 7, keeping employees on XP. The worldwide recession also affected PC and software upgrade cycles, causing businesses to do the best with what they had rather than make new purchases.

Rob Helm, research director at Directions on Microsoft, said it's going to be increasingly expensive for companies to continue to use XP because of fees associated with supporting such an old OS, so an upgrade from that OS to Windows 7 is "a question of when," not if.

For its part, Microsoft realizes that Windows 7 is an important release not only to get businesses to spend money again, but also to restore their confidence in the OS, he said.

"Microsoft's biggest business is Windows and its most profitable segment for Windows is businesses," Helm said. "It would dearly love to restart business PC sales and get businesses to move up to the most expensive editions of Windows. I think Windows 7 has the potential to help unblock that [spending] holding pattern when the economy recovers."

Vista's limitations for business customers have been well-detailed since its release to them in November 2006. One major misstep Microsoft made was not adequately preparing partners for its release, so many third parties did not have the software available for their products could work seamlessly with Vista. The company remedied this with Windows 7 by getting it out to partners way ahead of its Oct. 22 worldwide release so that many companies already have drivers and software ready for the OS, according to the Directions on Microsoft report.

Microsoft also introduced some new features in Vista that were not particularly user-friendly as originally conceived, such as User Account Control (UAC) and BitLocker, despite the fact that the company spent more than five years developing the new OS. Microsoft has made much-needed improvements to these features in Windows 7 that should make them easier to use, according to the report.

UAC was meant to improve the security of Windows by giving people who are the primary users of a PC more control over its applications and settings. The feature prevents users without administrative privileges from making unauthorized changes to a system. Because of how it was set up in Vista, UAC sometimes, through a series of screen prompts that interrupt normal user workflow, prevented even authorized users from being able to access applications and features they should normally have access to. Microsoft has reduced the number of these UAC interruptions in Windows 7, which should make it a more user-friendly feature.

BitLocker allows users to encrypt hard drives so it is difficult to get information from them if PCs are lost or stolen. However, as rendered in Vista, the feature was difficult and complicated to use, and it also only worked with internal, not external, storage drives.

Microsoft has simplified configuration of the feature in Windows 7 to make it easier to navigate, according to the report. The company also has improved it with a new Windows 7 feature called BitLocker to Go that allows encryption to be extended to external storage devices.

Helm said the enterprise version of Windows 7, when used in conjunction with Windows Server 2008 R2, its complementary server OS, also has business-specific features for remote access and file sharing that enterprises should begin evaluating now to see if an upgrade to both is warranted.

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