Windows Vista Toughest '06 Test For Microsoft

Windows Vista

Directions on Microsoft, a Kirkland, Wash.-based company that tracks the developer's moves, put the Vista challenge at the top of its annual list.

Although demos of the still-in-the-works operating system boast cool graphics effects and consumer features, it's enterprises that Microsoft must persuade. "Windows is Microsoft's biggest business unit, and Vista is it's biggest challenge," said Rob Helm, director of research at Directions. "Frankly, I think it's going to be very difficult for Microsoft to make its case to corporations."

January and February of 2006 will be the months to watch, said Helm, since that's when Microsoft will lock down the feature set for Vista. "Then they can try to tell corporations why they need it."

He's not optimistic because of the years-long trend of shrinking deferred revenues received from long-term licensing programs, such as Software Assurance, which gives customers the right to all upgrades during a two- or three-year span. Lower revenues there means that fewer companies are buying into Software Assurance, perhaps because they're balking at upgrading operating systems.

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"The Windows Client division has to tell corporate customers why they want Windows Vista, and why they shouldn't wait until they buy new hardware," said Helm.

Among the remaining challenges in Directions' Top 10 list, Helm singled out the newest refresh of an online strategy as least likely to show major results in 2006, and the Redmond, Wash.-based giant's new game console, the Xbox 360, as most likely to meet its challenge during the year.

"Microsoft's in a bit of disarray," said Helm when talking about the company's online strategy. "They're trying to focus on Google, and come up with things to take away from Google. I don't think we'll see any huge concrete results here in 2006." On the Xbox 360 front, however, the picture is rosier. "They got it out when they said they would, so I'm the most optimistic about this. But in part, it's there to protect the platform, so in the end, it will be more about beating Sony than laying any groundwork for profitability."

One additional challenge, which Directions described as taking a lead in application security and reliability, was highlighted by Helm.

"This is the one people were most passionate about," he said in characterizing the sometimes contentious discussions at the research firm about where to rank the problems that Microsoft faces in 2006.

Microsoft has rarely has the discipline to enforce development guidelines to ensure secure and reliable Windows applications, even with its own software, Helm said. "Microsoft always talks about what an effective ecosystem the Windows platform has, but that platform still needs leadership to make sure application security and reliability are important.

"It's dawning on Microsoft that it will have to get tougher with developers because they're looking at how Apple does things. Apple has always been more proscriptive when it comes to developers.

"It's not going to be easy, but Microsoft does have some leverage," said Helm. "And it's timely because of Vista. It's a good opportunity to change the developer culture.

"If they miss this one, the next opportunity won't come for two or three years."

Directions' "Microsoft's Top 10 Challenges for 2006" can be read in full on the research firm's Web site.