Vendors insist PC sales will survive Vista delay

Vendors insist PC sales will survive Vista delay

PC vendors denied their sales would slump after Microsoft Corp. announced another delay of its Windows Vista operating system.

PC vendors were putting on a brave face in the wake of news from Microsoft that the consumer version of the Windows Vista operating system would not ship in time for pre-loaded machines to reach retail shelves in time for this year's holiday shopping boom.

Microsoft has pushed back the release to January of next year, Microsoft co-president of the Platform and Services Division, Jim Allchin, said.

Allchin would not give specific reasons for Vista's delay, but said Microsoft's business partners had requested the delay after learning of a quality issue. They preferred a clear January date for release, instead of a rush to allow them to ship Vista on hardware by late November.

Microsoft still plans to release Vista to business partners in November 2006.

The delay could put a big dent in late-December holiday sales, industry analysts said.

"It's going to impact retailers, chip manufacturers, and computer manufacturers," principal analyst with Current Analysis, Sam Bhavnani, said. "It's really going to hurt consumer-focused PC makers. If you're a PC maker and you have all your eggs in the consumer market, your sales over the holiday season are likely to be less than you expected."

Bhavnani said the amount of mainstream media attention given to Windows Vista has created consumer awareness around the operating system.

"If there's a $US299 machine advertised at BestBuy they're going to sell as many of those as they would anyway without Vista, but if you're a more mainstream or higher-end buyer you might not want to drop money on a system that does not have Vista, knowing it will come out in a couple weeks."

But computer vendors insisted they could ride out the storm.

The delay will have "no material affect" on HP's holiday PC sales, company spokeswoman, Tiffany Smith, said.

"Microsoft is one of our most valuable and trusted partners, and we support them in determining the most appropriate schedule for their own launch. We are working together to ensure that what we deliver to customers is the best technology when it's ready," she said.

Other vendors said they would rely on sales of the business version of Vista, since the delay affects only the consumer version.

"Nobody here is really worried about it," since sales from the business sector could make up for any shortfall on the consumer side, a spokeswoman for Fujitsu-Siemens Computers, Stefanie Schusser, said.

In fact, the consumer shortfall may never happen. She doesn't expect that most customers will decide against buying a PC for Christmas just because Vista isn't on it. Also, people who may have been interested in buying a computer with Vista for the end of the year holiday season may just instead buy gift certificates, picking up the actual product a few months later when Vista is available, she said.

Still, analysts insisted that vendors' optimism was merely the start of a marketing push to make up for lost sales.

Even if the PC manufacturers do think the Vista delay will impact sales, they wouldn't admit it, principal analyst at research firm Ovum, David Bradshaw, said. "It would be bad business to say this is a big deal because it would stop people from buying PCs now," he said. He expected PC makers would lose a significant amount of sales because of the Vista delay and he considers it very uncertain that they'll be able to recoup the lost sales after the holiday season.

One consumer said he thinks the delay could potentially impact holiday spending.

"I would definitely delay it to check out Vista," Dan Voss said. "I actually haven't paid much attention to what's new with Vista, but I'd wait because I'd want the latest and greatest."

(Elizabeth Montalbano in San Francisco contributed to this story.)

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