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PC Sales Up Since Vista Launch, Maybe; Office Sales Definitely Up

There was a report last week that PC sales have been up sharply, rising 67% in the week Windows Vista launched. The sales increase might be easilly explained by stores clearing out their Windows XP inventory, with PC sales dropping 59% the week before, but there still is a lot to learn from the sales statistics:

“The price difference between Vista Home Premium and Vista Home Basic PCs was considerable, with Vista Home Premium notebooks selling for an average sales price (ASP) of $863 and Vista Home Basic notebooks selling for an ASP $616. Despite this significant price premium, notebook consumers chose Vista Home Premium 76% of the time.”

That’s great news for Microsoft. Last time around, few consumers opted for XP Pro, and about 50% were buying XP Media Center near the end, so Vista is doing a lot better with premium sales. Vista Home Basic, besides being a substandard OS that makes Vista look bad, costs the same as XP Home, so a high percentage of buyers opting for Home Premium means Microsoft gets more per user without subjecting the whole market to a price increase. In some ways, everybody wins.

Paul Kedrosky compared Microsoft stock performance after the three biggest Windows launches (Windows 95, Windows XP and Windows Vista), noting that Vista has had the worst post-launch showing. His numbers were through the seven market days after the launch, and it is now 12 days since the launch, and here’s how they stack up:

  • Windows Vista - Launch: January 30, 2007 - 12 days later: down 3.7%
  • Windows XP - Launch: October 25, 2001 - 12 days later: up 7.5%
  • Windows 95 - Launch: August 24, 1995 - 12 days later: down .5%

Given the huge buzz at the Windows 95 launch, and that it was Microsoft’s biggest launch ever, and the fact that Microsoft stock traded down until October 26, 1995 (two months, two days later!), it’s pretty obvious there is zero correlation between a launch and the stock price. Microsoft’s stock started seeing the effects of the Windows 95 launch in the second quarterly report after the launch, and the stock skyrocketed. Give it some time.

Office 2007 is doing very well at retail, with launch sales moving 108% more units than the Office 2003 launch (and 106% more revenue). This despite the fact that the business launch was months ago, and the slower shopping season, which implies the new suite is an early hit. Also, Office Home and Student is not making up as large a portion of sales as Office Student and Teacher did, with the lack of Outlook costing it about 10% of its predecessor’s sales. That’s good news for Microsoft which hoped removing Outlook would make businesses pass over the family suite.

February 15th, 2007 Posted by Nathan Weinberg | Vista, Office, Windows, Applications, General | no comments

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