Microsoft's 2009 was largely dominated by the ramp-up to the release of Windows 7, its desktop operating system and its biggest launch of the year. In this first part of a three-part series, eWEEK traces Windows 7 from the announcement of the beta release at CES 2009 to its Oct. 22 launch and aftermath. With a lot riding on the operating system's acceptance by both consumers and the enterprise, Microsoft engaged in an aggressive marketing and outreach campaign that seemed to pay off with rapid early sales and adoption, although the ultimate success of Windows 7 is indeterminate until 2010 and beyond.
2009 was a pivotal year for the company, to say the least.
The economic recession that gripped much of the tech industry did not spare Redmond,
which was forced to report a 17 percent decline in year-over-year revenue for
the fourth quarter of fiscal 2009. Earnings came in at $13.10 billion, around
$1 billion below Wall Street estimates. Much of that decline in revenue could
be tied to sluggish PC sales, which in turn lowered demand for Microsoft's
In response, Microsoft cut many of its legacy programs, including Encarta, and
embraced a corporate strategy of pushing the new versions of its flagship
software, including Windows 7.
Microsoft CEO Steve Ballmer announced
that Windows 7 had entered beta during CES 2009 in January. By throwing the
beta version into the wild, Microsoft subsequently told eWEEK and a number of
other tech publications, the company hoped that it could solicit a groundswell
of feedback that would allow it to fix any issues with the operating system
ahead of its October release. Microsoft has subsequently followed a similar beta
strategy with a number of other upcoming products, including Office 2010.
It's easy to see why Microsoft would attempt to release a final version of
Windows 7 that appeals to as broad a base as possible. Simply put, the company
had quite a bit riding on consumer and business adoption of Windows 7,
especially considering the reluctance of both those groups to embrace the
operating system's predecessor, Vista. Although Service Packs
addressed a number of user issues, Vista found its
reputation soiled by the sheer scope of issues that had accompanied its retail
release in January 2007-namely, that it was a buggy memory hog that lacked
backward compatibility with many Windows XP applications and forced users into
excessive authorization procedures related to the User Account Control.
As a result of these perceived issues, Vista adoption
rates have historically been slow. According to Net Applications, which
monitors the market share of operating systems, Vista
occupied some 18.55 percent of the OS market by the end of 2009, while Windows
XP continued to occupy some 69.05 percent. In the same survey, Windows 7
occupied around 4 percent. But even if its entire share came at the expense of Vista,
it still means that Vista managed at best to take up
less than a third of XP's total share.
On the eve of Windows 7's Oct. 22 launch, Forrester Research reported that
Windows XP continued to run on 80 percent of all commercial PCs. Despite the
aging of Windows XP, its stability and prevalence within the enterprise made it
a system that many IT administrators were reluctant to give up, especially when
the cost of a tech refresh and training workers on a new operating system were
thrown into the mix.
Microsoft attempted to address those concerns early by highlighting Windows
XP Mode, which runs XP-based applications within a virtual environment.
Introduced to assist businesses running older proprietary programs in transitioning
more smoothly onto the new platform, it is intended as a "last ditch"
fix for any programs that managed to elude Windows 7's focus on backward
The lack of a linear upgrade path between Windows XP and Windows 7, a point of
potential stickiness for businesses that choose to upgrade, was something that
Microsoft attempted to address on its Website
with step-by-step instructions for making the transition. In theory, a
clear upgrade path exists for Vista and Windows 7.
Nicholas Kolakowski is a staff editor at eWEEK, covering Microsoft and other companies in the enterprise space, as well as evolving technology such as tablet PCs. His work has appeared in The Washington Post, Playboy, WebMD, AARP the Magazine, AutoWeek, Washington City Paper, Trader Monthly, and Private Air. He lives in Brooklyn, New York.