Et Tu, Intel? Chip Giant Won’t Embrace Microsoft’s Windows Vista

Posted by SM Maulana

By Steve Lohr

Intel, the giant chip maker and longtime partner of Microsoft, has decided against upgrading the computers of its own 80,000 employees to Microsoft’s Vista operating system, a person with direct knowledge of the company’s plans said.

The person, who has been briefed on the situation but requested anonymity because of the sensitivity of Intel’s relationship with Microsoft, said the company made its decision after a lengthy analysis by its internal technology staff of the costs and potential benefits of moving to Windows Vista, which has drawn fire from many customers as a buggy, bloated program that requires costly hardware upgrades to run smoothly.

“This isn’t a matter of dissing Microsoft, but Intel information technology staff just found no compelling case for adopting Vista,” the person said.

An Intel spokesman said the company was testing and deploying Vista in certain departments, but not across the company.

Intel’s decision is certain to sting Microsoft because the two companies have worked closely to align hardware and software from the earliest days of the personal computer. Indeed, the corporate duo is known as “Wintel” in the PC industry.

Could Intel change its mind? Quite possibly. Microsoft’s chief executive, Steven Ballmer, has few equals as a forceful, persuasive salesman, and he and Paul Otellini, Intel’s chief executive, meet regularly.

Word of Intel’s lukewarm response to Vista appeared Monday in The Inquirer, an irreverent London-based technology Web site.

Intel is hardly alone in its reluctance to embrace Microsoft’s latest operating system, which was available to corporate customers in November 2006 and to consumers in January 2007. Large companies routinely hold off a year or so after a new version of Windows is introduced before adopting it, waiting for initial bugs to be eliminated and for applications to be written. “But by 18 months, you’d expect to see a significant uptake, and we haven’t seen that,” said David Smith, a Gartner analyst. “There’s not much excitement.”

His Gartner colleague, Michael Silver, said that about 30 percent of corporate customers skip any given new version of Windows. But the percentage will be higher for Vista, Mr. Silver predicted. Gartner’s corporate clients that plan to skip Vista, like Intel, do not see value of this upgrade, particularly since it requires new PC hardware at the time when the economy is weak and corporate budgets are tight.

Still, Microsoft doesn’t seem to be suffering too much from the resistance to Vista by some large corporations. Microsoft says there are more than 140 million copies of Vista installed on machines worldwide. Consumers and small businesses simply get the operating system that is on a new machine when they buy a PC, and that is Vista.

Meanwhile, the Microsoft operating system engine chugs on, phasing out the old and proclaiming the new. The company reiterated this week that, despite some customer protests, it would halt shipments of the previous version of Windows, XP, to retail stores and stop most licensing of XP to PC makers next week. Microsoft also announced that the next version of its operating system, Windows 7, is scheduled to go on sale in January 2010.

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