Microsoft Plans Vista 'Make Good' On Pre-Holiday PC Sales

Microsoft is set to offer coupons or take other promotional steps before its formal launch of Vista, to keep PC sales moving during the critical, end-of-year selling season.

Windows Vista will not be generally available to retail outlets or hardware OEMs until early next year. Volume licensees are slated to get their code by year's end, a fact that irked hardware manufacturers and retailers who worry that the delivery delay to them will stall sales in the key holiday buying season.

Mike Sievert, Microsoft's corporate vice president of Windows client marketing, told CRN the Redmond, Wash.-based company will take steps to prevent a market slow down during those critical months.

"Most likely, we will have some sort of promotion at the consumer level," Sievert said. "It's important that people see value right up until the launch of Vista.

Sievert said Microsoft is working with hardware partners to put such a program in place, but stopped short of spelling out exact details of how the company and vendors would provide incentives to buy Windows XP-based systems now and upgrade later.

At an investor conference earlier this month in New York, Dell CEO Kevin Rollins downplayed the impact of Microsoft's delayed Vista launch by saying Microsoft and Round Rock, Texas-based Dell had options to goose sales ahead of Vista's launch, including coupons for upgrades.

And such an action would not be without precedent.

Lance Stevens, Palo Alto, Calif.-based Hewlett-Packard's software product marketing manager for business PCs, declined to say if any specific plans were in the works between his company and Microsoft; however, Stevens said past actions by the software giant provide reason to believe they will be repeated.

"What I can say is that with every previous operating system Microsoft has launched, they have provided essentially an upgrade program, and it has typically applied to PCs purchased in the final few days prior to the launch of the new operating system " thirty or sixty days prior to launch," Stevens said. Such programs, he said, have typically provided for upgrades at only the cost of shipping and handling of CDs. "We have no reason to believe that will not be available with Vista," he said.

Microsoft has been under pressure since delays to the Vista launch were announced earlier this year. At the time of those delays were announced, system builders, solution providers and OEMs said they believed Microsoft should take steps to offer coupons or other promotions to blunt any sales slowdown during the critical end-of-year season.

Since then, while no programs or coupons have been officially announced, some vendors including Dell, Toshiba and others have begun laying the ground work to sell systems now that can be upgraded later. Toshiba, for example, has already been selling some notebooks with a logo that says they have been "Designed for Windows XPWindows Vista Capable." Dell now has systems with similar logos.

One channel source, who spoke on condition of anonymity, said word has been communicated to partners that within months of the launch, Microsoft would provide an end-user upgrade option on systems sold pre-launch that would allow end users to later upgrade to Vista for just the cost of the CD. But that channel source also said it is understood that system builders and solution providers might begin stocking initial Vista-based systems at Christmas.