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August 31, 2006 1:47 PM

What Is the Business Case for Upgrading to Vista?



With Windows Vista, Microsoft needs to please at least two constituencies with very different sets of requirements.

The Redmondians need to pack the next version of Windows with lots of bells and whistles that will appeal to consumers whom it is hoping to convince to upgrade. And it must do the same for business customers. I think Microsoft may have a tougher time making the business upgrade case than the home one for Vista. Here's why.

One enterprise user, who asked not to be named, recently posed an interesting question to me (via instant-messaging), regarding how Microsoft is expecting to make a business case for Vista.

MR. Biz: how are they going to make a business case for Vista?

MJF: that's a good question…. I'm not really sure

MR. Biz: no matter how much tweaking MS does, it's still not going to solve the resource requirements issue

MR. Biz: the 3D desktop should have been part of Plus

MR. Biz: vista will NEVER run on a $1000 PC

MR. Biz: EVER

MR. Biz: maybe a $1500 PC, but that one doesn't exist
Yet

MR. Biz: there aren't cheap dual cores yet

MR. Biz: price point is still around $2000

MJF: u are right

MR. Biz: basic users don't need this

MR. Biz: corporate users don't need this

MR. Biz: the corps are gonna scream bloody
Murder

MR. Biz: they can't afford to put $2000+ desktops on
each desk

MR. Biz: and buy all new copies of office to run on
It

MR. Biz: what we're talking about is a TCO of about
$3000 per desktop

MR. Biz: maybe even more than that

MR. Biz: that's before support costs

MR. Biz: that's just the damn software and hardware

MR. Biz: even if they leave the server infrastructure
the same

MR. Biz: which really, they can't

MR. Biz: so I bet its more like $5000 a desktop

MR. Biz: never before has a windows release required
such a major pill to swallow

MJF: good points

As you can see, it was kind of tough for me to get a word in edgewise. Once MR. Biz started thinking the Vista total-cost-of-ownership (TCO) equation through, he got a tad agitated. And he got me thinking.

It's a given that Microsoft is planning to tout security, reliability, improved system-management and increased cost and operational efficiencies as major Vista business benefits.

"For the IT professional, Windows Vista is easier to deploy, and less expensive to maintain, than any earlier version of Windows. And for your end users, Windows Vista's improved performance and reliability add value by allowing people to be more effective while performing their jobs," reads the copy promoting an upcoming Vista Virtual Lab.

Microsoft also is likely to downplay the need for massive desktop hardware upgrades, touting the Vista Classic/Basic mode as a way for companies to circumvent the need for the fairly hefty hardware requirements. (For a "Vista Premium" system running Aero, a minimum of a 1 GHz 32-bit processor; 1 GB of system memory; 128 MB of graphics memory; a DirectX 9-class GPU and 40 GB of hard-disk space.)

Microsoft wouldn't talk TCO specifics. I asked. A spokeswoman said to expect the company to share details later this fall, in the post-Release-Candidate-1 (RC1) timeframe. Vista RC1 is expected to go to more than two million testers as early as next week.

In the interim, Vista Product Manager Mike Burk did offer some limited guidance.

"Vista can positively impact a company's direct and indirect costs," he said. (Direct, in this case, is hardware, parts and depreciation; indirect is support; troubleshooting; specific configurations, etc..) "Vista will require fewer support calls. It will be easier to manage. It will have better deployment tools."

Is that enough? I queried another business user who has been quite bullish about Microsoft, in general, and Vista, in particular. He's planning for a fairly significant Vista deployment in the relatively near term and has been testing just about every Vista build that Microsoft has made available.

"We are using things like BitLocker (encryption) for protecting data, and the security enhancements throughout the OS. So it's an easy sell" to management, said this user, who also asked not to be named.

"As for the hardware, we've been planning for that for a while with Vista in mind. We've been telling our people to hold off from buying new machines," knowing that Vista – with its more substantial requirements -- would eventually come down the pike.

I'm curious to hear from other IT professionals how – and if – you are planning to cost justify Vista to your bosses. What do your TCO calculations look like right now? Or are you just digging your head in the sand, hoping to keep your users on Windows XP, Windows 2000 or some older Windows variant until you can find that Mac or Linux sysadmin job you've always wanted?

Talk back below or write me at mswatch@ziffdavis.com and
let me know what you think.

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Comments (20)

Eric Dush :

I hate to break the news to you, but I'm running Vista just fine on a brand new Gateway TabletPC that was only $999 from a retail store. It's running the full Aero 3D interface and doing a very nice job I might add with the ATI Mobility X600 video card.You might want to do some research before stating these wild claims about TCO for Vista hardware. I will agree that there isn't a lot of benefit in a business environment for Vista over XP, but honestly, these numbers are pretty much just randomly made up in some IM conversation.

Otto Fowler :

Is only NOW STARTING to support XP. The promise that this OS will require less support, better installs etc has been attached to EVERY MS OS release has it not?They deserve every bit of skepticism they get. They'll get credit for a great x.0 release as soon as they have one.

Thomas Olson :

I hate to break the news to a previous poster, but corporations don't usually support large numbers of tablet PCs, and we all know the beta version of Vista presently in the wild is not the one that will ship. Like the previous fellow, it's only in the last couple of years that my company fully embraced XP, and they had to invest in a LOT of new hardware to do it. For that matter, our content-publishing division still hasn't fully converted to Mac OS X!A lot of people in IT looked at Vista beta, said "ho-hum, maybe with our next hardware upgrade cycle"...in the 2009-2010 fiscal.Besides, there's nothing really new in Vista besides better eye-candy, most of which was blatantly and shamelessly copied from OS X Tiger - where indeed is the business case?

Grant Johnson :

The business case is simple. There will be new software, probably part of Office, that ships with new PC's which is not compatible with the old one, and will only run on Vista.The business case is that due to planned obsolescence, your will be forced to upgrade for interoperability reasons. The business case is not one of saved costs, but one of you have no choice.

James Stump :

I have been buying AMD dual-core business PCs by HP (dx5150) for a little while now for under $750 per PC. They meet or exceep Vista's hardware requirements. Hardware prices have been dropping fast lately.

Jeff Smith :

"Or are you just digging your head in the sand, hoping to keep your users on Windows XP, Windows 2000 or some older Windows variant until you can find that Mac or Linux sysadmin job you've always wanted?"Try again MJF. At least pretend to be objective.

Jeff Smith :

Try researching all the security, sys management and other socket related improvements. The eye candy is all the user sees (which makes this a harder sell to the average joe user) But to corporations Vista is a justifiable upgrade.

Do Not Do It :

There is no business case for Vista. Period.All the meaningful enhancements have been ripped out which just leaves additional levels of security and eye candy for the end user. The so-called productivity enhancers require developer skills in doing development the Microsoft way. This immediately cuts off nearly all small and medium size businesses because they generally don't have and can't afford the skillsets needed.The business case _against_ Vista is manyfold.1} The single biggest security enhancement possible is to completely inhibit use of ActiveX controls. I speak from experience in managing the security of 200+ desktops. Vista adds more complex security layers instead. Complexity is not a good thing. Moving people to alternatives like Firefox and installing Cisco Security Agent completely satsify all the same and more security requirements Vista is purported to provide.2} Vista will break many legacy apps. We run over 30 PCs with direct physical connections to laboratory analysis machines of all sorts. Because of 3rd party software restrictions, I cannot upgrade any of these PCs. We need _certified_ versions of these software suites for each upgrade. Naturally, some of this software is 'orphaned' so these software upgrades will never be available. The single most often used piece of equipment in the QC lab runs software which only works on Win3.11. I support it by running Win3.11 on a VMWare virtual workstation.3} Cost is not a small issue. It's not just the added costs of replacing current PCs with order of magnitude more powerful PCs. It also involves eventually replacing all screens with HD DRM enabled versions. There are only a dozen different DRM enabled displays currently available. Naturally, they're all very expensive at the present time. 4} Infra-structure costs will go up as well. To make use of all this High Definition stuff will require updating the internal network bandwidth, servers, data storage, yada-yada-yada. And the additional licenses to run them too.4} Support costs _may_ go down. Certainly there is no guarantee there! On the other hand, I do expect development costs to substantially rise. Vista will be much more complex to program for if a company wants to take advantage of the new {vague} enterprise productivity 'features' Microsoft keeps touting. I suspect support costs will at least stay even if not go up. It's my general observation that the dumber you make something ties in directly with how much people stop thinking for themselves. i.e. I expect the support desk to become even more involved in telling people how to accomplish the tasks their jobs require. For reference, find the study done in England reqarding use of PowerPoints and intelligence.This list can go on and on and on and on ...I literally see no benefit to switching to Vista and many reasons not to.Of course, your milage may vary.BTW - my nym was not chosen for this particular occasion. While apt, it's purely coincidental.

Do Not Do It :

And how many of these are DRM enabled to play high definition content? And where did you get the screens which are DRM enabled as well? The cheapest such screen I saw was for $700.Oh! And what's entailed in swapping out your current graphics cards in already purchased workstations with DRM enabled versions?Are your new workstations equipped with 2 gigs og RAM?I'm not trying to knock your response. But with 5 versions of 64 bit Vista and 1 version of 32 bit Vista to be available, 'Vista Ready' is pretty meaningless. Unfortunately, some of the new enterprise productivity features will only be available on the top 2 versions of Vista.YMMV and all that.:-D

Do Not Do It :

There will be 5 64 bit versions of Vista and 1 32 bit version. Different features will be available for different levels of Vista.So, will your tablet run all versions of Vista? I know you can't run DRM High Definition content. That isn't released yet. Also, your tablet screen is incapable of supporting the requisite HD display levels. That's something else which isn't released yet.The enterprise version of Vista is the most expensive and requires the most powerful PCs. That is the cost basis you should be considering.

Keith Risler :

No conventional business case exists for upgrading to Vista. Most enterprises and users have PCs that more than meet users' and companies' needs. The reality being that Microsoft's fevered push to market dominance with MS-DOS, Windows 3.1, 95, NT, 98, 98SE, ME, 2000, and XP (and the parallel Office app releases over the years) accelerated desktop computing's capabilities so that we may not need anything new for 20 years or more.Thus Microsoft has had to resort to increasing the opportunity cost of not upgrading, by dropping out security fixes for Windows 98, which is really part of its grander "life cycle" policy that relatively soon will knock first Win2k and then XP out of practical use in terms of hand-holding support options. It all creates an artificial need for Vista, because the cost of not using Vista. measured as risk and lack of older OS support, may be unbearable.The Windows 98 endpoint is instructive: Virtually on the very day things ended for 98, lapdog MS players like ZoneAlarm dropped updates for Win98 as well. In what other market can the controlling vendor virtually turn off a product in this way. Answer: Virtually no other market at all.In a way, asking whether there is a business case is a moot question in the extreme, because it is fairly obvious that Microsoft makes its money by tieing the sales of Windows to PC sales. MS DOES NOT NEED TO MAKE A BUSINESS CASE for Vista, because most buyers will HAVE TO BUY Vista with a new PC. We all know that almost no one buys Windows upgrades, which begs the question as to what the Vista tiering and upgrade-after-purchase schema is all about. What it seems to be all about is MS taking the top tier Vista profit, when a user chooses to take base-range or mid-range Vista upmarket, all to MS, rather than letting the dealer add in a higher level of Vista at sale and so get part of that margin. Prediction: Most business PCs will be bundled with Premium but vendors will find it uneconomic to roll in Vista Ultimate as an option, and instead it will be cheapest for the buyer to do a direct Ultimate upgrade after purchase than to roll in Ultimate at purchase time.Or something along these lines--meaning that MS is essentially clawing back some of the PC sales profit from he sellers of Windows PCs. I need not mention that MS's market leverage means it does not have to make a BUSINESS CASE to any PC seller for taking this part of the seller's margin.

Methuss :

Ok first the person messaging you obviously has not actually tried it on a $1000 pc. I've got it sucessfully running on a $900 Thinkpad T41 with no problems; albeit without Aero-Glass. Most corporate customers will turn that eye candy off anyways. They are for work, not toys.But the real kicker is the way Vista installs. The install is actually a disc image using a new ghost-like format to dump the system file-by-file to the hard drive. Hardware Abstract Layers are gone, so the image is almost completely hardware agnostic. IT departments won't have to worry about buying GHOST or having to maintain image sets for every different hardware model. The technology also allows you to inject drivers and applications into an existing image from a command line utility. This will remove a huge cost (and headache) from IT staff rolling out hundreds of machines.

Keith Risler :

A poster opined: "But the real kicker is the way Vista installs. The install is actually a disc image using a new ghost-like format to dump the system file-by-file to the hard drive."The foregoing point is a classic Red[mond] Herring.The issue is that one will not soon get to the point of actually installing Vista, as the business case for getting to that point is weak at best.

Methuss :

had to maintain several thousand computers, have you PolarUpgrade? My cost for 1000 licenses for GHOST was over $12,000. Time spent on deployment testing whenever some funky device driver changes due to manufacturer specs changing that causes Windows to hork up can be anywhere from 20 to 80 man hours.Not having to spend an average of $140,000 a year on deployment makes the case for me.I suppose smaller companies that don't have to deal with thousands of computers would have less incentive. But that's not the business customers Microsoft is targeting with this new architecture.

Bill Tippery :

Let's see $300 to $500 X 400 stations = $12,000 to $20,000. We will not attempt to get it all done at once! XP Pro on the laptops for now. New graphic cards, NIC's and switches on some of our servers. Still in the lab testing phase determining tech man hours. IT isn't cheap, but we do not want to go back to 1998!

John :

How does reduced deployement (if its true, and given MS's track record, why believe that) save us money when we already have our systems deployed? What about the cost of retraining all your users to use the new interface?

Paul :

I'm amused reading all the negative comments. I remember reading many of the same comments when XP was released. No, no, no, it's not better, it will cost too much to upgrade, etc. My company supports many small businesses that listened to the IT people that said these things and stayed with '98 or 2000. When I showed them what XP contains and what they are missing, they upgrade and find it very worth it. Now I'm looking at instant searches, systems that won't let unauthorized installs or users messing with system settings, etc. and I'm sure Vista is worth it. Yes, you can do some of these things with policies and 3rd party applications that take more time and money to implement and support. Vista has it built in. I'm also running XP in a virtual machine and that performs well too. :-)

Kent :

While I've yet to hear a great benefit from running Aero there are plenty of other non-hardware intensive business benefits to running Vista. For example, the single image will be a HUGE win to people responsible for desktop deployments (I had this responsibility at one point in my career and it mantaining multiple images was a nightmare). Add up the benefits of more group policies, enhanced security, full-system search, etc. and lots of business customers will come to appreciate Vista. Its certainly not at all about the new visuals (and needing an LDDM card to support them).

DouglasPaul :

Who wrote this? I work for a corporation that has some 25000 desktops and we have been leasing sub-$1000 desktops for over a year that will run Vista fine. That includes the newest dual core and a Gig of RAM. We chose not to upgrade the video cards, but can do so for a small increase which would still keep us well under $1000. I'm not on any side here, but man you are so busy trying to trash something that you are totally out of touch with reality.

agon :

what must the doing will be a one sucess bussines

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