It's a big week for
and maybe for its investors as well. After literally years of waiting, this week you'll be able to buy a legal, shrink-wrapped copy of
("W2K") in any of its three flavors: Windows 2000 Professional (the single-user client-PC "workstation" version), Windows 2000 Server and Windows 2000 Advanced Server.
Will you want to?
More on that Thursday. (Since by definition 100% of
readers are PC users, I'm going to make a rare exception to my "no computer-geek-talk" rule. Thursday I will discuss the advantages of Windows 2000 and whether you're better off jumping to it, staying with an earlier version of Windows or moving to Windows 98's successor, coming later this year.)
Will this release kick off a huge buying binge, to the quick benefit of Microsoft stockholders?
Probably not; more on that this afternoon.
Will W2K lead to a boom for PC hardware makers?
Yes, unquestionably; more on that Wednesday.
Now, buckle your seatbelts for the wild W2K ride, fueled by massive overclaim from Microsoft and analysts, its tracks greased by gushy trade-press reports, plus occasional scary dips and turns courtesy of the usual suspects among the ABM ("Anyone But Microsoft!") crowd. Watch for this one coming to Disney World, or maybe a Six Flags park, soon.
Microsoft is giving Windows 2000 a lavish promotional push, with an expensive kickoff Thursday in San Francisco at the
Windows 2000 Expo
plus a much-whispered list of guests who will, it is understood, stand up and pledge their fealty to W2K. Another hundred or so "launch events" around the world this week will, Microsoft hopes, leverage off the San Francisco event, feeding the presumed excitement over the way-late release of W2K.
As usual, Microsoft executives have contributed their by-now-stock "Second Coming" speeches about W2K. My favorite so far is new CFO John Connors' remarks at a recent
Banc of America Securities
conference: "Windows 2000 is a bet-the-ranch product for Microsoft."
I sure hope, not, John. Or at least, I hope that bet has a lot of hedging attached to it. Because while W2K is, collectively, a very strong group of products and will eventually replace most installations of its predecessor, Windows NT, I think this is going to be a fairly slow, multiphase product ramp for Microsoft.
- First, many companies that have been working with W2K beta releases over the past couple of years will cautiously move to the release-level server editions of W2K as
production software, not just limited-use test-bed software running on tiny test-bed networks within companies' IT departments.
The IT managers in these companies have high hopes for W2K, but they also know how cautious they have to be in moving their users to a new operating system. So look for them, the W2K version of "early adopters," to slowly roll out W2K Advanced Server in their companies.
Second, these and other companies that have been experimenting with the workstation version of W2K in several successive beta (test) releases will this spring start specifying to their boxmaker suppliers that their new PCs come with Windows 2000 Professional preinstalled. Most will begin with notebooks, because W2K has indisputable advantages in the notebook environment.
There are advantages for desktop computer users, but these are less important than those for mobile users and on servers, so this will be a much slower ramp.
Third, by midyear, we'll see a number of major PC vendors pushing their customers to take W2K Professional as the operating system preinstalled on their new machines. Supporting a variety of operating systems is costly for boxmakers, and they don't like it. For them, standardizing on one OS has real economies, and they'll pursue that vigorously.
Gartner Group analyst Mike McGuire says he thinks 50% of all shipping PCs will go out the door with W2K by Christmas. (Gartner Group sent Microsoft a widely misinterpreted Valentine card last week. While some interpreted its focus on the costs of upgrading to W2K as a slam, in fact it predicted a payback period of less than two years for the direct and substantial indirect costs for companies moving to W2K.)
Fourth, late this year and mainly in 2001, we'll see the majority of companies now using Windows NT 4 start their migration to Windows 2000 Advanced Server, company-wide. IT managers like to wait for at least the second release of so important a product -- or as we've seen with Windows NT, for at least one or two so-called "service packs," or collections of patches and bug fixes -- to feel sufficiently comfortable with the stability and security of the products that they make standards in their shops.
By this time next year, they'll have begun to feel that comfort factor with W2K, that it has become solid and stable enough for their needs ... and that will mark the beginning of the real move to Windows 2000.
Meantime, Microsoft can already claim Windows 2000 is a success -- and that the company hit its target of shipping before year-end -- because since December, Microsoft has been shipping release-level versions of the W2K products to its OEM customers, so they could begin preloading the software on the computers they build.
That means Microsoft can legitimately say it's already recognizing revenue from Windows 2000 sales -- and that W2K will have some presence, if far less than a major impact, on its third-quarter earnings.
Coming next: Laying the groundwork for success: W2K and Microsoft's bottom line ... and stock price.
Jim Seymour is president of Seymour Group, an information-strategies consulting firm working with corporate clients in the U.S., Europe and Asia, and a longtime columnist for PC Magazine. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. At time of publication, neither Seymour nor Seymour Group held positions in any securities mentioned in this column, although holdings can change at any time. Seymour does not write about companies that are current or recent consulting clients of Seymour Group. While Seymour cannot provide investment advice or recommendations, he invites your feedback at