Foley on Microsoft

Will Microsoft’s Hardware-Upgrade Push Backfire?

The hardware demands of the next Windows and Office System 2006 products may prove to be not worth the effort for vendors and customers.

Customers (and shareholders) are not the only stakeholders to which Microsoft is beholden. Hardware vendors are an integral part of Microsoft’s orb, too. The demands of these chip, PC and server vendors are not always in sync with the needs of customers.

The clash of Microsoft’s constituencies could surface in a major way as early as this year, when Microsoft is due to launch Windows Vista and a number of Office System 2006 products, including Exchange Server 12.

Microsoft is gunning to convince customers that its next-gen products are must-haves. At the same time, it has to convince its user base to move to brand-new high-end desktops and servers to exploit these new wares.

On the desktop front, Microsoft’s message is that Vista will work best on new PCs. While company officials have soft-peddled this point, the fact is that short of a graphics upgrade, only a small number of consumer PCs and even fewer business PCs (even those bought in the last year) are likely to support the highest Aero Glass interface that will ship with Vista.

Microsoft won’t finalize Vista’s hardware requirements until this summer, when the operating system is supposed to be released to manufacturing. Microsoft recommends that customers wanting to take full advantage of all Vista interface features buy machines with a discrete graphics card that supports its DirectX 9 graphics framework, Windows Display Driver Model, 32 bits-per-pixel (bpp) color depth, and at least 64MB of graphics RAM.

Those wishing to run Vista-optimized applications, such as the Max photo-sharing sample application Microsoft released at the Fall 2005 Professional Developers Conference, will need PCs with at least a 2.4GHz processor, 512MB of RAM and a graphics card capable of handling the Windows Presentation Foundation (aka “Avalon”) subsystem.

On the server front, Microsoft has been less cagey about upgrade requirements. But for users, the end game will be similar.

In mid-November Microsoft listed a number of 64-bit only OS and application products, including Exchange 12, the forthcoming Windows Midmarket Server (code-named “Centro”), Windows Longhorn Small Business Server, and Windows Longhorn Server R2 (due in 2009 or later).

Microsoft has lined up some convincing performance reasons for customers to move to 64-bit. And company officials have even taken to beating the security drum, highlighting, for instance, the greater rootkit resilience offered by 64-bit systems.

But will those advantages be enough to move product? Market researchers, including Gartner Inc. and Directions on Microsoft, sounded the warning alarms shortly after Microsoft made its 64-bit-only intentions known. Both outfits predict the 64-bit requirement will result in a slow upgrade curve for Exchange 12, at the very least.

While there’s little doubt that most customers will be looking at, if not already running, 64-bit hardware by 2009, the same can’t be said for 2006. New servers sold this year and next will be, by and large, 64-bit machines; but not all server customers are upgrading in the foreseeable future. In fact, I’d argue that many of the small and midsize business customers Microsoft is targeting with Exchange 12, Centro and Windows Longhorn Small Business Server will be running older 32-bit systems for some time.

There are other problems, too -- 64-bit drivers are still slow in coming, and there aren’t a whole lot of native 64-bit applications out there. And new PCs and servers don’t grow on trees.

So while Microsoft’s hardware-upgrade messages are no doubt making its hardware partners ecstatic, users are likely to be less thrilled.

What’s your take? Will customers happily upgrade not just their Microsoft software, but also PCs and servers, in one fell swoop? Or could Microsoft’s hardware-upgrade push backfire? Write me at mjfoley@redmondmag.com and let me know what you think.

About the Author

Mary Jo Foley is editor of the ZDNet "All About Microsoft" blog and has been covering Microsoft for about two decades. She has a new book out, Microsoft 2.0 (John Wiley & Sons, May 2008), about what's next for Microsoft in the post-Gates era.

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Reader Comments:

Sat, Jan 28, 2006 Rico Malaysia

Innovation is a double-edged word. If you do not move forward, others will considered you as a hindrance to progress. Microsoft cannot put themselves in that position. The main upgrade requirement for Vista is the graphics card - which haven't seen much attention or progress in recent years. Having worked with Vista, it would seemed that the engineers have put this technology to pretty good use. Now if only MS can do something to help to bring the darn upgrade cost down. Too much wishful thinking on a Sunday morning ;)

Thu, Jan 19, 2006 Dberk Hanover MD

In response to Chris: I would agree to a point; the problem being that as soon as the customer base begins the upgrade process Microsoft will push for another OS upgrade that requires more hardware. While this does drive the IT economy, it makes a mess for IT in the trenches that constantly have to "make it happen" for their business "partners". So while Microsoft may drive the industry and keep employment up, salaries may not rise as much due to costs of hardware/software for the constant upgrades. I think we should all virtualize anyway!

Thu, Jan 19, 2006 Chris Anonymous

If Microsoft doesnt make the big bet and lead into the next generation then nobody will. Sales may be slow for a while but the upside is that when people do buy new hardware that will support it, the sofware will likely be more stable and the support issues well documented

Upgrade in one swoop, doubtful, but MS's strategy is more than about short term gains.

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