A lot of people seem surprised by Microsoft’s decision to drop the retail prices of Vista, including a whopping 30% reduction for Vista Ultimate.
“It’s sort of an odd move,” said Gartner analyst Michael Silver, while NPD Group’s Chris Swenson opined “I can’t remember a big price cut like this.”
Boys, welcome to the new and exciting world of OS competition.
Gone are the days when Windows dominated the landscape while Apple struggled on the edges, and alternatives such as Linux were embraced by a small, ultra-geeky group. Today, Apple is booming while Linux is – surprise, surprise – moving, if ever so slowly, into the mainstream. Who knows, maybe IBM will bring back OS/2 given the revival in the OS landscape!
Microsoft may have sold 100 million copies of Vista since its launch last year but even the folks in Redmond know that Vista hasn’t been a booming success from a financial, brand or technology perspective.
For all of Apple’s poking fun at Vista, the truth is consumers – for the first time perhaps ever – have real choice. Buying a Mac is no longer seen as risky if you aren’t tech savvy, a graphic designer or a student. These days, people, who would have never thought about buying a Mac, have become Apple disciples even if it has meant paying a premium for the privilege.
All Microsoft is doing by slashing the prices of Vista is being smart. If you need a better competitive position to deal with pesky, revived rivals, a quick and dirty tool is lower prices.
The question, of course, is whether lower Vista prices will work. Since its launch last year, Vista has struggled to resonate with consumers even as Microsoft has dealt with some of the criticisms. It’s particularly telling – and embarassing for Microsoft – that demand for XP is still alive and well. itComputer Canada, for example, just launched a SaveXP campaign.
If Microsoft is going to revive Vista, it’ll probably take more than lower prices. Perhaps the next version of Windows will resonate with consumers but the harsh reality is the OS marketplace has changed and there’s nothing Microsoft can do to restore Windows’ dominance.
There’s a new kid in school, and his name is competition.
