Microsoft Expects 1 Billion Windows Users by 2010

prostoalex writes "The head of Microsoft Windows client division claimed there will be 1 billion Windows users by 2010, while nowadays there are 600 million of them, Microsoft-Watch reports. 35% of Microsoft's enterprise customers are still running Windows 9x and they are ripe for upgrade. Currently Microsoft's desktop PC market share is at 96%, with the closest rival - MacOS from Apple Computer - being installed on 2.8% of the desktops."

Comments

New Headline

[BigDork1001]

1 Billionth Windows Virus Expected By 2010.

Re:New Headline

[Digz]

Wall Street, NY - In a surprise move, Microsoft (MSFT) announced today that they have reached their virus targets ahead of schedule. The company had formerly predicted the one billionth Windows virus by 2010, but were pleased to surprise investors with the news that the goal had been reached five years early.

"Woohoooooo!!!!! We did it!!! We finally did one thing that didn't have to be delayed several times!!!" said Microsoft CEO Steve Ballmer while running around his office. "Eat that, you Linux zealots!"

Microsoft was founded in 1975, and has become the largest software company in the world.

hmmm

[Beaker1]

Maybe they should get one of those signs like McDonalds used to have: "over 1 billion served!"

Re:hmmm

[yiantsbro]

Yes, as a Windows user you have definately "been served"

Re:hmmm

[danormsby]

> Maybe they should get one of those signs like McDonalds used to have: "over 1 billion served!"

Are you saying Microsoft likes fat clients too?

Re:hmmm

[ericvids]

Are you saying Microsoft likes fat clients too?

Although Microsoft has inadvertently promoted unhealthy diets for a long time, it started in recent times to convince their Fat customers to try the new Ntfs(tm) diet.

Some Tech Guy: I've tried Ntfs for quite some time now and it really works! I've eliminated most of my unsightly clusters in just three weeks!

Some Tech Guy 2: Stay fit, not fat! You too can lose all of that data! Switch to Ntfs now!

Bravado

[treehouse]

As they say, predictions are difficult, especially about the future. What we have here is either bravado or, at best, a marketing goal. Lots of thunder and very little rain. What it's doing in ./ other than as a troll, I don't know.

Re:Bravado

[Otter]

As they say, predictions are difficult, especially about the future. What we have here is either bravado or, at best, a marketing goal. Lots of thunder and very little rain.

Actually, it doesn't strike me as a particularly grandiose goal -- a 2/3 increase in worldwide computers over the next six years, and more less hanging on to their market share? Not hitting that seems like it would be bigger news.

Re:Bravado

[isorox]

predictions are difficult, especially about the future.

As opposed to the other kind of predictions?

Re:Bravado

[EpsCylonB]

Actually, it doesn't strike me as a particularly grandiose goal -- a 2/3 increase in worldwide computers over the next six years, and more less hanging on to their market share? Not hitting that seems like it would be bigger news.

When your market share is 96% it is difficult to be too optimistic about growth.

Re:Bravado

[Tim C]

What it's doing in ./ other than as a troll, I don't know.

Two things:

* generating page impressions and therefore ad impressions
* giving everyone something else to point and laugh at about MS

Meanwhile, MS are taking OSS seriously and working to maitain (or regain, if you prefer) the upper hand.

Move on people, nothing to see here; your time would be better spent working to prevent this prediction from coming true, if that's your preference.

The MacDonald's of Operating Systems?

[Aardpig]

1 billion sold -- but poor quality, dangerous for your health, and leaves a bad taste in your mouth?

Re:The MacDonald's of Operating Systems?

[Anonymous Coward]

In other news, Linux is a meal at a soup kitchen. Don't like it? You're more than welcome to volunteer to make food for all the other freeloaders.

I'll just eat this Apple, thanks.

Legal?

[Martigan80]

Is that 1 Billion LEGAL users?

Windows in 2010

[lacrymology.com]

2010... is that when they are releasing Longhorn?

-m

Users or installations

[danormsby]

So is that 1 billion users or installations?

If users how many of those users will also be Linux/Mac users?

Maybe someone familiar with set theory can comment here?

Is the interesting claim

[orin]

Perhaps the interesting claim here is that there will be over a billion computers currently in use in the world (one computer for every seven or people). That is, assuming that 96% figure is correct.

Doesn't one billion PCs sound a little high considering that the vast majority of the world's population doesn't have access to a telephone?

Winds of Change

[ciryon]

Allthough I can't quote any scientific studies or reports I can FEEL something is changing. Everywhere around me people are throwing out Windows, replacing it with Mac OS X or Linux. Internet Explorer is slowly losing market share. A general awareness of alternative platforms is beginning to progress. There have been so much talk in the media about the insecurity of Windows and how other operatingsystems don't have these problems. I really really doubt there will be one billion Windows users by 2010.

Re:Winds of Change

[int19]

Agreed. A few months ago my not-so-computer literate brother came to me asking me to install Linux for him; he had just gotten screwed around by some spyware or some such. He had never really used it before. Now he uses it for everything except the odd video game.

My father switched to Mozilla sometime last year without prompting from me.

Just two small examples.. But it's true; awareness is slowly coming around. It will be interesting to see just how far it goes, especially in light of the recent browser issues.

Re:Winds of Change

[mst76]

I'll start to believe when the Google Zeitgeist shows more than 5% for Mac or Linux. I've watched that page for quite some time now, and the only large shifts I've seen has been from one Windows version to another.

No hard evidence here

[grunt107]

The report does not say where these extra 400 million are coming from. I doubt China would embrace MS, with "Red Flag" their pretty puppy.

Short of the smaller emerging countries, which seem to embrace non-MS more often than not, India seems the only place likely being targeted.

Interestingly, the one fact they report - 35% of users in Win9x/NT - would be a perfect focal point for an all-out Linux/Mac ad blitz (whoever wants it the most). That would take over 200 million away from their current base.

yeah!!!

[chef_raekwon]

yeah! who cares? until companies stop buying windows for their pcs - this won't change. I'm an admin for Solaris and Linux -- and I have to use Windows on my laptop....(managed desktop) something to do with exchange something or other...

so we make do with exceed, scrt and putty. poor windows.

Re:Ninnle Linux... then back on topic.

[mirko]

runs all your favourite RISC OS apps
Thanks for reminding me of the Betamax of Desktop OS'es :'(

One day, Bill Gates went to Herman Hauser, head of Acorn, in order to convert him to MSDOS.
Hauser answered :
"-Thanks Bill, but we really cannot make that step backwards."

The BBC (RiscPC's ancestors) indeed had network (Econet which spawned ATM), mouse, color and sound while MSDOS almost had directories...

In 1994, my RiscPC had antialiasing, full-screen video and was able to execute Windows on a 486SXL second processor...

So, Microsoft is about to be used by 1/7 of the planet, I guess it's more because they know how to influence people who can take such decisions for their fellows.

Double-Counting?

[Chazmati]

Do you think they adjust for all the PC's sold with a licensed copy of Windows, then wiped and imaged with a corporate version of Windows that's separately licensed? I think every PC I've seen at work has a Windows product sticker on it, but it doesn't match the actual version installed.

Prediction: sun to rise...

[SlowMovingTarget]

All the article really says is that Microsoft expects all those myriads of people still running Win 95/98/ME/NT workstation to upgrade. Basically, they're counting in much the same way McDonald's counts, in this case, by number of licenses sold. This number is not a measure of active users.

Linux has an opportunity to beat Microsoft to the punch with Longhorn. Application learning curve? Given that few of your existing applications will work in Longhorn, why not learn Linux? Fully developed suite of utilities and applications, you say? Buy a distribution from SuSE, Redhat or Mandrake [insert your distro here]. With Longhorn, Microsoft is giving up the one advantage they really had, the Win32 APIs (a position elaborated very well by Joel Spolsky in his Joel On Software column--sorry I don't have the link handy).

Re:Prediction: sun to rise...

[dave420]

I'm not being funny, but how can linux beat longhorn? It's taken years and years for there to be a good OSS office clone, and just as long for a decent OSS browser to find its way out. Now, you expect linux to somehow spawn a multimedia child that can do everything under the sun, without having to touch .conf files or ever use a command line.

Lets not get above ourselves. I'm a linux developer, yet I can see that linux has a long way to go in some key areas. Sure - you can do 95% of windows stuff on linux, but until it gets to (or over) 100%, it's not going to change. linux will be the underdog.

Don't interpret the recent moves away from IE as moves to Opera/Firefox - they didn't change because firefox and opera are so good, but because IE is so bad. Is that how Linux wants to be the best OS? Waiting for Windows to kill itself? jeez.

I can just see the new sign in Redmond...

[Serk]

Over One Billion Served!

Somehow fitting, as Windows is to well written software what a Big Mac is to fine cuisine...

No bravado, just ordered optimism

[RoLi]

How does Microsoft expect to increase their market share 35% in the next 6 years[..]

They don't.

Microsoft stock isn't rising anymore for several years already, Microsoft needs some optimism for the stockholders so Gates, Ballmer, etc. can sell the rest of their stock - oops, sorry: to diversify their portfolio - before it becomes worthless.

The cold hard truth is that MSFT is still vastly overvalued. In the late 90's Microsoft looked like the company that will take over everything: Servers, embedded systems, cellphones - and destroy anything else: mainframes, all non-x86 architectures, etc.

The stock was valued this high because of these huge perceived future earnings.

Now things have changed a lot and Microsoft is struggling everywhere outside their core-market (which is desktop software) and even their core-market is threatened.

Microsoft has 60 billion in the bank, but will they ever be able to earn enough to justify their market cap of 300 billion?

I seriously doubt that.

Re:No bravado, just ordered optimism

[danheskett]

The cold hard truth is that MSFT is still vastly overvalued. In the late 90's Microsoft looked like the company that will take over everything

No, in the late 90's, virtually everything in the tech sector was overvalued. In the 90's, there was vast any wide speculation about the future of MS as a single company. Remember that?

The stock was valued this high because of these huge perceived future earnings.
I disagree. The stock was valued high because it is a stunningly profitable company. And because despite its legal problems it continues to earn a tidy profit.

Now things have changed a lot and Microsoft is struggling everywhere outside their core-market (which is desktop software) and even their core-market is threatened.
Let's get real. Their core market isn't going anywhere. For the forseeable future - 5 to 10 years, Microsoft will still rule the desktop. Period. Prices may have to be cut a bit, but it's not going anywhere. It would take a generation - twenty years at least - to remove MS from the desktop just by sheer force of momentum.

Microsoft has 60 billion in the bank, but will they ever be able to earn enough to justify their market cap of 300 billion?
That's a real question. But the original question is not.

How does Microsoft expect to increase their market share 35% in the next 6 years[..]
Is a bogus question. They are not trying to from 60% market share to 95% market share. What MS is projecting is the global growth of the PC market, applied to their 95% shared. Over the next 6 years is it reasonable to add 400 million Windows PCs world wide?

Yes, absolutely.

Re:No bravado, just ordered optimism

[RoLi]

I disagree. The stock was valued high because it is a stunningly profitable company. And because despite its legal problems it continues to earn a tidy profit.

7-10 billion profit per year is a lot, but the number by itself is meaningless. The only thing that matters is how much had to be invested to get that 7-10 billion/year, and 300 billion is way too much.

If you have 300 billion, you will make more profit/year when you put it in the bank instead of buying Microsoft. - And with much less risk, too.

To make things much more understandable, replace "billions" with "thousand". Would you buy a company for 300 000 that only makes 10 000 in profit per year?

So, at 300 billion, Microsoft is clearly overrated - UNLESS there are some huge market opportunities out there.... But those have evaporated. Currently Microsoft is only defending the status-quo and is forced to give discounts, all bad for revenue and profits.

Let's get real. Their core market isn't going anywhere. For the forseeable future - 5 to 10 years, Microsoft will still rule the desktop. Period.

Depends on what you mean by "rule the desktop". If you mean "having 51% or more of the installed base", then almost certainly yes, at least in North America.

Prices may have to be cut a bit, but it's not going anywhere.

A price cut costs Microsoft a lot of money. See above. That's not good for the stock price.

And lately, Microsoft has risen prices. Their new licensing scheme is great for short-term earnings, but bad for long-term marketshare. Why is everybody assuming that Microsoft is thinking long-term? If they would, then, yes, they would drop prices. But they don't, instead they rise prices to squeeze out the last penny out of their existing customers. That's a great short-term strategy, which is much better for Gates/Ballmer, because they are selling MSFT now and not in 10 or 20 years.

Please don't think that the interests of Gates/Ballmer are the same as those of Microsoft the company.

It would take a generation - twenty years at least - to remove MS from the desktop just by sheer force of momentum.

Yes, that's true. However, there is something in between "ruling the market" and being completely "removed".

Re:No bravado, just ordered optimism

[0123456]

"Over the next 6 years is it reasonable to add 400 million Windows PCs world wide?"

Yes, but it's highly unreasonable to expect them to be running full-cost, legitimate copies of Windows. To get that kind of increase you'd mostly be selling to China, India and other countries where $100 or more for an OS is far more than most customers would want to pay.

Re:No bravado, just ordered optimism

[RoLi]

but MSFT has had record earnings and revenue for the LAST 12 CONSECUTIVE QUARTERS.

Just plain wrong:

Fiscal years 1999 to today, the numbers of fiscal 2004 are extrapolated from the first 3 quarters (= 3 quarters times 4/3)

Revenue Earnings

f1999 19.75 7.78
f2000 22.96 9.42
f2001 25.30 7.35
f2002 28.37 7.83
f2003 32.19 9.99
f2004 ~36.73 ~7.31

As you can see, while revenue is indeed growing, earnings are pretty much staying the same. Windows2000 and the new licensing scheme were good for some short term earning boosts, but in general earnings are around 7.5 billion/year and flat.

Oh, and by the way, the latest quarter with 1.3 billion in earnings was the worst Microsoft had since fiscal 1/02 (which was 1.2 billions). And of course the numbers vary on a quarter-to-quarter basis, there were never 12 consecutive record quarters in the last 5 years for Microsoft.

And it's quite possible that fiscal year 2004 (which ended 2 weeks ago) will be Microsoft's worst since fiscal year 1998, we'll see soon.

Re:No bravado, just ordered optimism

[molarmass192]

And it's quite possible that fiscal year 2004 (which ended 2 weeks ago) will be Microsoft's worst since fiscal year 1998, we'll see soon. That gives more credence to Ballmer's "cut a billion" memo. Makes you wonder where they're generating that revenue from, could it be XBox sales? Those would generate a lot of revenue but negative profits.

Re:No bravado, just ordered optimism

[danharan]

Exactly. Seeing a price-earning ratio of 40 should be cause for concern. Even if you take out the cash reserve, that's only 7 Billion earnings for 260B in capital, a P/E of of 37. That's not normal for a mature company.

And the P/E is not going to improve any time soon, at least not sustainably. OOo is squeezing their margins on their productivity suite, and they are apparently coming out with an Access alternative. After the productivity suite is cross-platform, what's to keep clients on Windows? Add to that people using cross-platform browser and mail software... and Windows is in a terrible position.

I've no idea what it is, but investors may soon realize that MSFT is not going to be a good investment... the increase in computers is not going to increase their profits sufficiently to make it an attractive investment any time soon. If I had investment money, I would be selling short.

How many users are you?

[infra-red]

Personally, over my multiple machines, I am probably counted as 4 users going back over my last 4 machines.

After all, machines may die, but licenses live on forever.

Why don't OS X and Linux attract more users?

[mst76]

Seriously, this is not a troll of flaimbait. If Windows is really so bad as many people claim, why does it have so many users? I'm not looking for unhelpful onliners like "most users are idiots", etc. Some Linux and a lot of MacOS X users claim that their platform is superior to Windows in every way. Many Apple users will even argue that the Mac platform is not even more expensive (although they often confuse price with value). If so, why don't more people switch?

I'm a reasonably advanced computer user. Of the major platforms, I use Win2k/XP, Linux quite a lot, OS X somewhat less. In my opinion, they are pretty comparable for most things I want to do (and they each have their own set of quirks). But maybe I'm missing something obvious. So if anyone has some INSIGHTFUL comments on why people don't switch en masse to superior platforms, please let me know. And no flames please, let's try to keep the discussion polite.

Re:Why don't OS X and Linux attract more users?

[Slack3r78]

Right now, high cost of entry is the barrier. In Linux's case it's in time, in Apple's case, it's monetary. This is coming from someone who runs a single Windows box for gaming, 3 Linux boxes, and will be buying an Apple portable in a couple of weeks when the cash is available.

When it comes to Linux, it's just plain easier to run the copy of Windows that came on their $499 Dell than it is to spend time installing and learning a completely different operating system. It's what everyone else uses, so they might as well. Intertia is the cause more than anything.

The same goes for Apple here. While the hardware may be of higher quality and the overall experience for your average user may be higher, the fact remains that your minimum investment into a Macintosh is a $799 eMac, which is more expensive than that $499 Dell. And besides, nobody in the "real world" uses Macs and they're not compatible with anything, right? That's the mindset of the average user, whether it's based on fact or prejudice is another story entirely.

So what it comes down to is that, while I agree with you that all three platforms are perfectly adequate for the needs of most desktop users, Windows maintains its market share through pure inertia. It's what people know, it's what every one else uses, and it's basically just the path of least resistance all around. This, in turn, makes moving to an alternative more difficult, which means fewer people are likely to switch.

The Last Dinosaur

[IGnatius T Foobar]

I dunno ... a lot can happen in six years. Microsoft claims a billion Windows users by 2010, but one might consider, on the other hand, Jeff Prothero's prediction that by 2010, Windows will be as dead as CP/M which is based on doublings-over-doublings of Linux market share.

Reality, as always, is probably somewhere in between.

How many paid licenses?

[miffo.swe]

I seriously quiestion their reveny is going to be this high in the future even if they succeed in bringing home additional markets like China or India. Pirating is rampant and not many are aware of license costs. Recent discounts MS have been handing out seems to indicate that prople just dont want to pay that much money for MS Windows. Constant upgrading of the operating system isnt something the users want either. The day of printing money seems to be coming to an end.

Suppose Microsoft somehow makes the ultimate DRM system effectivly killing all the pirating in the world? Would the users gladly pay or would they just switch to something free and gratis instead?

Microsoft is in for a ride and i hope it makes them a teamplayer like IBM and others who once was big and without concious.

Article is already Wrong.

[jetkust]

This article, written in 1999, predicted 10% of the desktop in 2000 (which never happened), 40% of the desktop in 2001 (which never happened), and market saturation in 2002. So reality is somewhere inbetween Microsoft being write, and this article being totally wrong?

Maybe - but I reckon that this will happen

[LardBrattish]

1) Longhorn will be the most expensive version of Windows yet developed (No shit Sherlock) BUT it will be the cheapest in real terms.

2) Linux will start to win around the time M$ start to push people towards Longhorn. Linux will have another 2 years of polish and development. Businesses will start to tale a long hard look at the choice of paying the Microsoft tax & taking it up the ass from Bill or shifting to Linux paying the short term pain (which will be a lot closer in cost for businesses when it comes to deploying Longhorn) with the long term gain.

We won't get everybody but as the O/S upgrade cycle swings around we will pick up a significant proportion of business. Once that business starts wanting features & sponsoring their development then it's bye bye monopoly.