Consumers may be chattering about Microsoft’s new operating system Windows Vista with all the excitement of small children on Christmas Eve, but for VARs the launch seems like it may be more akin to Groundhog Day and at least six more weeks of winter still lie ahead.
That’s because in spite of all the marketing by Microsoft, businesses are still as cautious as ever about making a big move to a completely re-engineered operating system. And VARs are reporting a wide range of experience with the upgrade in terms of Microsoft tools and marketing available.
“Businesses don’t shift as fast as consumers do,” said Larry Willits, who does sales and technical OEM system builds for Computer Co-op in Williamsport, Pa. Willits estimated that some local hospitals would wait a year or two before making the move. But that wasn’t any longer than they would wait to make any OS change.
“A lot of businesses will likely continue to order XP until they can’t anymore and have to go with Vista.”
That desire to keep buying XP has been a mini-boon for at least one VAR. Tim Klan, president of Expert Computer in Erie, Pa., said that because big box retailers such as Best Buy and Circuit City ran such big promotions to move their XP inventory ahead of the Jan. 30 retail Vista release, many are now out of stock for the older operating system. That has led to a boost in some lower-end XP sales for his company for the last week or so.
“Retailers don’t have the systems on the shelf to sell last week and this week, so we’ve seen some customers that don’t normally come to us,” he said.
Meanwhile, Klan said that although he has been happy with the OEM tools and marketing provided by Microsoft, he was disappointed with the disparate point of sale marketing tools provided to retailers compared with what he got.
“Retail stores have more marketing materials,” he said. “I would love to have a banner for our store and one of the shelf displays of the empty Vista boxes. The only time I ever get that is if something is left over.
“If I want to put out a display like that and stock my shelves, I have to buy the full product, take the discount and keep the disks in the back. That’s a disadvantage,” he said.
And while some VARs were left pining for more point of sale marketing materials, other smaller VARs were left with practically nothing.
“To be honest, they haven’t provided me with any tools,” said Joshua Brodbent, president of Any Way Computer in Wynne, Ark. “I didn’t get a test copy or any NFR [not for resale] copies to evaluate.”
Brodbent, a Microsoft partner, said he got beta copies, but said anyone could get those. He believes that his company’s size, one to five employees and less than $500,000 a year, may have excluded it from getting any marketing materials or tools.
“I’m sure they are going to include it in the resource kit the next time around,” he said. “But I would have expected NFR copies.”
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Still, it doesn’t seem to be making that much of a difference because his company has not seen much interest from customers for the new operating system.
Many VARs expressed satisfaction with Microsoft’s System Builder site for OEM VARs, which offers tools for helping VARs with the roll out of the new OS. It also offers comparison charts that explain the differences between versions of Vista.
But the training sessions that VARs were aware of “are more of a pep rally, not a deep session on how to install, roll out, etc.” said Klan. And some VARs complained of the distance to travel to such sessions.
Meanwhile, D&H Distributing on Jan. 29 announced a series of training sessions, promotions and products to help VARs with deployment. Some of the initiatives include rebates for bundled OEM products and promotions from manufacturers such as Kingston, Western Digital, ViewSonic, Intel and AMD.
D&H said it has also been offering Vista training sessions at trade shows to provide sales and product information. The distributor reported seeing strong demand for the new operating system.
For its part Microsoft said it is offering some tools beyond its normal technical and sales/marketing training. They include a tool to help customers find partners, targeted prospect criteria and lists for partners to help them identify prospective customers, and the Upgrade the Desktop campaign—a framework for introducing customers to Windows Vista and Microsoft Office Professional Plus 2007. The campaign is targeted at midmarket customers and provides cross-sell and up-sell opportunities across the stack, Microsoft said.
In addition, Microsoft is planning several events including seminars for small and medium companies, IT professionals, developers and technology partners. The company said there will also be 15 key city launch events with 2,000 customer attendees at each event. On top of that, the software giant is planning 59 Microsoft Across American events through early March with 1,000 customers at each of those events.
In spite of all this, however, many businesses just aren’t making the move to Vista.
“Some customers put off spending because they were waiting for Vista,” said Klan. “But once Vista was close to being released, the word came down from management that everyone was prohibited from buying Vista.”
That reluctance of customers to move to the new Microsoft OS may actually prove to be an advantage for some system builders, he added.
“We can use downgrade rights,” he said, moving a brand new PC that ships with Vista back down to XP. That’s not something that retailers can do.
Klan said he expects customers to request that downgrade for 80 percent of his company’s new system sales in the near future. And these requests are likely to add service revenue to the company’s top line.
“It’s more work for us because the process is complicated,” he said, involving calling a toll-free Microsoft number and explaining why the Vista activation failed, plus going through the whole downgrade process.
“I bet my Microsoft rep $10 that the support line won’t understand what we are talking about,” he said. “We’ll find out in a few days who wins.”