twitter's Journal: NYT: "Microsoft's Vista Problem" will Grow with Recession.

Steve Lohr of the New York times thinks Microsoft's 11% drop in quarterly earning due to poor Vista and Office 2007 sales is only going to get worse with a recession looming.

Microsoft keeps insisting that Windows Vista is a winner, but the questions keep mounting and Thursdays quarterly report only added to the doubts. Revenue from the companys so-called client division PC operating systems mainly came in at a bit under $4.03 billion. That was about $300 million less than most analysts had expected.

Mr. Liddell [of Microsoft] dismissed claims that some customers were reluctant to buy Vista machines. There are no Vista-related issues at all, he declared. Perhaps. But even if there were issues with Vista, no Microsoft executive would say it publicly.

It only makes sense that with the economy weakening, corporate technology managers are pulling back from plans to upgrade to Vista from the previous version of Windows, Windows XP. An IDC survey of 300 chief information officers, published earlier this year, found personal computers at the top of the list of hardware spending that companies would cut back on in an economic slowdown. In software, spending on operating systems like Vista and Microsofts Office suite of productivity programs would be the first to be put off, they said. Vista, given the more powerful processing power it requires, represents both a hardware and a software upgrade.

No surprise, then, that there has been a rising chorus among corporate technology customers who want Microsoft to keep licensing Windows XP

It will be a shame if coporate IT people panic and also avoid free software migration which will save them more money than sticking with XP and all of it's problems. Their avoidance of Vista makes perfect sense, but people should realize that Vista's failings are non free software failings that can only be cured with free software.

As a side note, Lohr's view of M$'s credibility is amusing. Without invoking the whole Vista capable fiasco or low business penetration statistics, he dismisses Liddell's denials out of hand. To Lohr, Microsoft representatives won't tell the truth even when they know it. Credibility zero is a hard knock from a paper like the New York Times.