Windows 7 Gained Share in October, but Microsoft Doesn't Dent Apple

Microsoft's Windows 7 made slight gains in the overall PC market in its first 12 days of release, according to statistics firm Net Applications, while Apple managed to gain incremental market share in October. Although Windows 7 now owns just over 3 percent of the market, that number is expected to increase as Microsoft continues its massive marketing push for the new operating system. Windows 7 has earned mostly positive reviews, which may encourage Windows users to trade up from XP or Vista.

Microsoft's Windows 7, the company's much-hyped new operating system, owned some 3 percent of the PC market by Nov. 1, according to a new report by statistics firm Net Applications, but failed to dent Apple's market share in the process.

Net Applications' daily tracking shows Windows 7 gaining ground, starting at 1.99 percent on Oct. 22-the operating system's first day of general release-and reaching 3.67 percent by Nov. 1. While the actual share numbers are still small, that represents a 12-day gain of 84 percent.

Despite analysts' theories that the Windows 7 release could adversely affect Apple's operating-system market share, Net Applications' data further showed that the percentage of Mac users increased slightly in October 2009, reaching 5.27 percent. However, it will take several quarters' worth of time, and several more analyst reports, before the true nature of Windows 7's effect likely becomes clear.

According to Net Applications, Microsoft's various operating systems currently hold 92.52 percent of the overall market. Previous to Windows 7's launch, Net Applications had tracked Microsoft's share of the operating-system market as falling, with the percentage of PCs using Windows dipping from 93.06 percent to 92.77 percent between August and September. Net Applications says that it collects data from the "approximately 160 million visitors per month" to its clients' Websites.

The expectation is the Windows 7 will indeed continue to occupy an ever-larger segment of the market, thanks to a massive marketing push by Microsoft. If Apple continues to maintain or gain market share in the face of that pressure, though, it would validate earlier analysts' comments about the longer-term ability of Steve Jobs' company to weather the latest attack on its walls.

"We do not expect Microsoft's pending launch of Windows 7 ... to erode Apple's Mac franchise," Mike Abramsky, an analyst with RBC Capital Markets, wrote in an Oct. 20 research report. Short term, Windows 7's improvements over Microsoft's much-hated Vista, "along with expected positive reviews, publicity and marketing/promotions, may offer near-term headline risk to [Apple's] valuation."

Even before Windows 7's high-profile launch event in New York City on Oct. 22, Microsoft had been pulling out all the stops to promote its newest platform, massive sales of which could help the company reverse its declining revenues.

In addition to a series of discounts and promotional offers through retailers such as Best Buy, targeted mostly at consumers, Microsoft took steps to make Windows 7 an appealing proposition for the enterprise, including offering Windows 7 Enterprise in a free 90-day trial edition. According to a report by research firm Forrester Research, some 80 percent of all commercial PCs continue to use Windows XP, an aging but stable operating system.

The inevitable changes in security and driver models in the years since XP's release, however, mean there is no linear upgrade path between Windows XP and Windows 7, potentially discouraging businesses wishing to adopt the new operating system. To ease the disruptive process of upgrading between the two platforms, Microsoft introduced Windows 7 Upgrade Advisor, a free downloadable program for testing existing computer systems' compatibility, while posting step-by-step instructions for transitioning on its site.

For businesses running legacy applications that depend on Windows XP, Microsoft included Windows XP Mode in Windows 7, which allows those XP-based applications to be run in a virtual environment. One of businesses' largest complaints about XP's successor, Vista, was the lack of backward compatibility with such applications, an experience that Microsoft seems anxious to not repeat.

According to Net Applications, Vista still held 18.8 percent of the PC operating-system market on the eve of Windows 7's release.

Editor's Note: A sentence was added clarifying Microsoft's overall PC operating-system market share.