New Windows Era

It's strategy time for Microsoft customers as Windows Vista goes into beta testing. So, what's your plan?
IT managers need to decide if they'll be first-in-line beta testers or the not-so-fast majority. "We stay off the bleeding edge unless there's a significant business reason to take the risk," says Bob Witte, CIO with Morrison Homes Inc., via E-mail, explaining why his company may wait until after 2007 to upgrade 1,000 PCs running Windows XP. Group-travel site Groople Inc. will move faster, most likely replacing Windows XP with Windows Vista on 50 PCs within six months of availability. "We like to maintain a standard environment, and we like that to be the newest available," says Scott Larsen, manager of information systems.

IT-advisory firm Gartner expects companies to wait 18 months after Vista's arrival before deploying it widely. In an informal poll of 160 readers, 20% plan to implement Vista within a year of availability, 24% in 1 to 2 years, 33% in 2 years or more. One-fourth had no plans.

The time lag presents a problem to Microsoft since customers, knowing that Vista is around the corner, are holding off on buying Windows XP. Factoring out sales to PC makers, Microsoft's license business for Windows dropped 9% last year. The company had trouble selling multiyear licenses for Windows XP to large companies because of "uncertainty" about the arrival date and features of Vista, senior VP Will Poole said last week.

It will take a new generation of applications built around Windows Vista to drive its uptake because businesses no longer view running the latest version of Windows as a competitive edge, says James Governor, an analyst with RedMonk, a market-research firm. "Think about a pilot implementation? Yes. But plan the migration? I don't see it yet," he says. New lightweight technologies, some of which will find increasing support in Vista, will dominate future Web applications and propel Vista adoption. Examples: blogging applications and more direct interactions with users, using Really Simple Syndication to share targeted information; Extensible Application Markup Language, for automated features underneath Web forms and documents; Extensible Stylesheet Language Transformation, which allows translation of one XML dialect into another; and WinFS or XML-based file storage.

Centex Homes won't be tinkering with the Windows Vista beta. "We wouldn't do Vista until it's in general release and would wait for all of our software vendors to certify on Vista" before deploying it, CIO Charles Irsch says. But with about 8,000 Windows PCs, 75% of which run Windows 2000, Irsch is keenly interested in Windows Vista's security. "The whole security concept is probably the biggest need that has to be addressed," he says. Today, "you have to build a set of tools around [Windows] because they're not built into the operating system like they should be."

Windows Vista comes at a time companies are scrutinizing IT spending. In addition to software-licensing costs, IT departments need to factor in computer-hardware and application upgrades and the staff resources needed to pull it off. But could there be savings at the end of the rainbow? Windows Vista can knock as much as 25% off the cost of managing desktops in the next few years, Poole said.

Companies with Windows XP can afford to wait longer than those with Windows 2000 to upgrade to Windows Vista. Most independent software vendors will stop supporting Windows 2000 in two years, and Microsoft plans to cease bug fixes for the operating system in 2010. Gartner recommends companies that skipped Windows XP start making sure beta 1 runs in their data centers and get on the phone with their most important ISVs to ensure that they'll be making the Vista leap.

Even so, all that planning and testing will only get you so far, Groople's Larsen says. Large IT environments make it difficult to test every piece of software for total compatibility when a new operating system gets introduced. Says Larsen, "The question is, what's going to break?"

With Charles Babcock, Larry Greenemeier, Rick Whiting, and John Foley

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