Late starters to Windows 7 migration may find it more costly, says Gartner

Late starters to Windows 7 migration may find it more costly, says Gartner

Summary: Companies planning to migrate from XP to Microsoft Windows 7 in 2011-12 may have to pay over the odds for expertise, according to Gartner Inc. The research company says: “During that period, demand for highly qualified Windows 7 migration IT personnel will exceed supply, leading to higher service rates.

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TOPICS: Tech Industry
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Companies planning to migrate from XP to Microsoft Windows 7 in 2011-12 may have to pay over the odds for expertise, according to Gartner Inc. The research company says: “During that period, demand for highly qualified Windows 7 migration IT personnel will exceed supply, leading to higher service rates. These cost hikes are likely to continue in 2013, as organisations recognise that they are behind in their migrations.”

Charles Smulders, managing vice president at Gartner, said: “With most migrations not starting until the fourth quarter of 2010 at the earliest, and PC hardware replacement cycles typically running at four to five years, most organisations will not be able to migrate to Windows 7 through usual planned hardware refresh before support for Windows XP ends.”

Whether companies accelerate their PC replacement schedules or upgrade existing machines, Gartner reckons that spending on PCs will need to increase “from 15% of a typical IT budget … to 18% (best case) and 24% (worst case)”.

Gartner puts the migration cost at between $1,205 and $1,999 per PC for organisations replacing 10,000 PCs, or between $1,274 and $2,069 for organisations that upgrade existing PCs, “depending on how well-managed the PC environment is”. Since the upgraded PCs will soon need to be replaced, doubling the total cost, it will be cheaper to buy new PCs. However, in the short term, this will require more capital expenditure.

In Gartner’s statement, research vice president Steve Kleynhans says: “Based on an accelerated upgrade, we expect that the proportion of the budget spent on PCs will need to increase between 20% as a best-case scenario and 60% at worst in 2011 and 2012.”

Gartner estimates that “large and midsize organisations worldwide will migrate approximately 250 million PCs to Windows 7” during its timeline. Including small businesses would make the number much larger.

Of course, I expect the companies that have saved money by running a 9 year old operating system on 4-5 year old PCs will have the cash stashed away in readiness.

However, companies with smart IT staffs must already be well prepared for the coming migration. They would obviously have started testing their applications for compatibility when Windows Vista appeared four years ago, and confirmed their findings during the Windows 7 beta test and early launch period. They will already have started adapting programs where they have to, or will know they work correctly in Windows 7’s XP Mode. They will probably be well informed about the rapidly growing Windows 7 migration industry of consultancy companies and enterprise hardware and software suppliers who expect to make pots of money out of it.

Windows 7 has turned out to be the fastest-selling operating system in history, so the main question is how soon it will overtake the installed base of Windows XP. (On some techie websites, usage already has.) At ZD Net US, Ed Bott extrapolated Net Market Share numbers to suggest that Windows 7 will surpass XP early in 2012.

Either way, the Windows XP market (which means the amount of money spent now, not the size of the installed base) will soon disappear, because most people aren’t willing to spend money on an operating system that’s on its death bed. And since the vast majority of the web’s programmers are extremely keen to drop support for IE6 as soon as possible, and everybody else wants to stop patching up XP’s foibles and insecurities, it may not be a very pleasant death.

Topic: Tech Industry

Jack Schofield

About Jack Schofield

Jack Schofield spent the 1970s editing photography magazines before becoming editor of an early UK computer magazine, Practical Computing. In 1983, he started writing a weekly computer column for the Guardian, and joined the staff to launch the newspaper's weekly computer supplement in 1985. This section launched the Guardian’s first website and, in 2001, its first real blog. When the printed section was dropped after 25 years and a couple of reincarnations, he felt it was a time for a change....

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11 comments
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  • This is excellent strategy on Microsoft's part. If customers aren't upgrading fast enough, they get a few of their flunkies to go out and spread scare-tactics about "upgrade now or it is going to cost you even more later". It says a lot about the quality and desirability of their product - just as much as the other major upgrade incentive from Microsoft , "upgrade now because we are going to kill XP whether you like it or not".

    Once again a totally irrelevant and baffling statement in the final paragraph - exactly what does anyone's desire to drop support for IE6 have to do with the death of XP?
    j.a.watson@...
  • I find it hard to credit those numbers; are they assuming a great deal of internal apps needing rewriting or some other infrastructure remediation? Are the counting the cost of retraining? Are they counting the cost of a new PC in there as well? How much IT time does $2,000 pay for - two weeks? three weeks? Per PC? There must be something I'm missing...

    @JAW many companies don't want to go through two separate upgrades so they're holding on to IE6 and XP even though they could upgrade from IE6 on XP - so the move from XP to 7 will result in a mass move away from IE6 as well.
    Simon Bisson and Mary Branscombe
  • I think those costs are probably fairly accurate, $1,205 and $1,999 per PC seems reasonable. A standard base desktop PC costs close to $800-900. I'm assuming they are factoring in extra costs for re-buying applications that are compatible with Windows 7, too.

    There will be additional costs though, that cannot be planned for, that can get out of hand very quickly. Re-buying some software to be compatible with Windows 7 can be very costly. Recently I came across a situation where a software package will need to be re-purchased because it had run on XP since 2005, and is NOT Windows 7 compatible. Costs will be in the thousands, for a group of 40 PCs, on top of buying new hardware because the PCs from 2005 will not run Windows 7. There will be costs for training on Windows 7 since it is very much different on the front end. A lot of Windows 7 is very similar to XP under the covers, remote administration is still similar for admins and the IT staff. The biggest change is the interface for the end user. Also, the number of patches released is still high for Windows 7.

    There's been a lot of hype about the record number of copies of Windows 7 sold. But where are these numbers obtained, are these OEM copies, or retail? OEM will surely be high as vendors are phasing out XP sales, so the only choice is Windows 7 (if you are looking for Windows). I'm curious to see how many copies of it are being sold on store shelves.

    In the end, if the companies have enough resources, they will start testing applications now, to try and estimate what they will be faced with. There will be costs, it's just a matter of how much.

    I'm not blaming Microsoft for trying to phase out XP. It's 9 years old, which for an OS is quite old and outdated. But, they have not presented a nice upgrade path for customers. They have offered limited to no discounts for companies on XP now, because they know that they will be forced to upgrade so they are milking everything they can out of it. This is typical business for Microsoft, and the economy is still not where it was 7, 8 years ago. Companies are still scraping together, so it will be interesting to see what kind of migrations take place.
    Chris_Clay
  • A migration to Windows 7 does also virtually enforce a migration to Office 2010. Clearly all in Microsoft's interest. Furthermore, many perfectly serviceable hardware, scanners for instance, will not work with Windows 7. Obviously there is considerable financial outlay (pain) in migrating to Windows 7, with a limited return on investment, particularly for businesses with lots of customised software; all this at a time when money is tight and we are on the edge of recession - and for some time to come.

    The argument is pain now, or potentially more pain later when the pain can be afforded. Nonetheless, the phasing out of windows XP and all new computers coming with Windows 7 will exert it's own influence.
    The Former Moley
  • It would be interested to see if the Gartner report was sponsored by anybody, because it stinks of customer self-interest. If not Microsoft itself, then one or more of its lackeys thinks that this particular gravy train is not going at the speed it desires and is dangling the bogey man in front of us so we'll open our hearts (and wallets) to Windows 7.

    Unfortunately for them, the report - or at least, the parts that they've made public - is complete and utter twaddle.

    As JAW says, moving off IE6 in no way dependant upon Windows 7. IE7 and IE8, not to mention superior browsers like Firefox and Chrome, all work fine on XP. Simon/Mary's argument that doing it all in one go to a avoidsa double upgrade just goes to show the difference between people that actually work in IT and people that just write about it.

    FYI, the golden rule of IT upgrades is that you upgrade one thing at a time, and then you test, test, test! You do not, repeat *not* upgrade the OS and the apps at the same time! If you do that, and if it goes wrong, where are you going to look for the problem? Is it the OS or is it the app that's at fault? You won't know, and you can rest assured that the app vendor and the OS vendor will point the finger at each other (yes, even if it's the same vendor!).

    Those figures about increased contractor rates are hilarious! They're largely irrelevant too. Every desktop upgrade that I've ever seen has been handled by the in-house IT staff. Are they all going to turn around and start asking for 50% pay increases for their spanking new Windows 7 skills? Methinks not. (And that's ignoring the fact that "Windows skills" is a contradiction in terms anyway.)

    As for Jack's crack about "companies that have saved money by running a 9 year old operating system on 4-5 year old PCs will have the cash stashed away in readiness"; what planet are you on, mate? Have you opened the papers in the last year or two? There's been something of a recession going on around the world, in case you hadn't noticed. Not too many company's have got much money stashed away for *anything*, let alone to waste on a huge upgrade that's going to gain them absolutely nothing at the end of it.
    BrownieBoy-4ea41
  • I know several small companies that are not going to upgrade to 7. When the time comes, and XP is buried, they are going to switch everything over to Linux. Most of them have already started switching to Open Office, and getting IT staff that is familiar with Linux. Because, as was stated, the economy is not going to improve anytime soon, and there is no stash of extra cash laying around.
    ator1940
  • @Simon Bisson and Mary Branscombe
    > How much IT time does $2,000 pay for - two weeks? three weeks? Per PC?
    > There must be something I'm missing...

    At IBM or big consultancy rates, about a day and a half ;-)

    @apexwm
    > I'm not blaming Microsoft for trying to phase out XP. It's 9 years old, which for an
    > OS is quite old and outdated. But, they have not presented a nice upgrade path for
    > customers. They have offered limited to no discounts for companies on XP now,
    > because they know that they will be forced to upgrade so they are milking everything
    > they can out of it.

    There's a perfectly good upgrade path from Vista. Companies that skipped Vista made that choice of their own free will (and I'm not saying they were wrong) so they are responsible for the consequences. Microsoft has already helped them out with XP Mode, and for the companies with Software Assurance. the Windows 7 upgrade is free anyway.

    @ator1940
    > I know several small companies that are not going to upgrade to 7. When the time
    > comes, and XP is buried, they are going to switch everything over to Linux. Most of
    > them have already started switching to Open Office,

    Penny wise and pound foolish, in my view. They can save maybe up to 1% of their IT costs by using Linux and OpenOffice but the total costs of switching are enormous. It doesn't help that OpenOffice is slow, bug-ridden, and has very poor compatibility with Office, which makes it hard to work with existing documents. Still, now Oracle owns OpenOffice, I'll be interested to see what my old multibillionaire aggressivley-capitalist mate Larry Ellison does with it.
    Jack Schofield
  • Jack : Yes, there's an upgrade from Vista, but look at the market share of Vista vs. XP. Most non-Windows 7 are still on XP, and that's where the upgrade link has been broken. Sure, there's user state migration, but it's not an easy task to accomplish. A lot of companies probably won't have too much in the way of user states and settings. But software compatibility is a big one.

    I recently tried "XP mode". All that is, is an XP virtual machine. I can almost guarantee there will still be proprietary software and devices that do not work in this VM. In my opinion, Wine on Linux does a better job of having a transparent application virtualization layer.

    "They can save maybe up to 1% of their IT costs"
    I'd like to know how you propose this number? MS Office costs hundreds per copy, OpenOffice costs zero. Windows costs hundreds per copy, Linux costs zero. Both require training and a learning curve so those hidden costs will probably be close.

    ator1940 : You have a great point and I am sure they will be happy that they made the move in the long run. Linux migrations require lots of time, patience, and a will to learn something new. However, after the dust settles, the benefits will kick in of not dealing with bloatware and insecure products of Microsoft any longer.
    Chris_Clay
  • I'd also like to comment on OpenOffice.

    "...OpenOffice is slow, bug-ridden, and has very poor compatibility with Office..."

    Actually one of the perks of OpenOffice is its compatibility. It will open any version of MS Office documents. However, there are issues with formatting, depending on how the MS documents were created. There have been formatting issues within Office versions itself, anyway. I wouldn't rate it as "poor", I would rate it as "adequate". When was the last you did some testing? What were the specific issues you faced? Let's have some examples.

    I have used OpenOffice since the days it was called StarOffice. It's an excellent product. For free, it does the basics, and that's enough to suit most users. Best of all, you can get it for FREE, and try it. If you don't like it, simply un-install and you're back where you started from. I admit that I've always used the Linux versions, so I cannot speak for the Windows port of it.
    Chris_Clay
  • @Jack,

    > [Switching to Linux/OpenOffice is] Penny wise and pound foolish, in my view.

    That's right, Jack. It''s pound wise to:
    * hand over huge amounts of money every 3-5 years for an OS/Office suite that gives you little that you current one doesn't
    * buy new PCs every 3-5 years to accommodate the bloat of your new OS/Office suite (see previous)
    * spend money on retraining every 3-5 years because the functions on your new OS/Office suite have been moved around (again) to no real gain. (Or do you really think that somebody can move to Office 2003 to Office 2007/2010 without training?)
    * pay out for anti-virus software that doesn't actually work very well, and so still get hit by downtime when a virus strikes (that's downtime = *real* money) despite being promised that your new OS was "more secure" than the previous one
    * pay wages to a small army of MCSEs, whose "qualifications" seem to extend no further than a reboot/reinstall/log a call with Microsoft


    > They can save maybe up to 1% of their IT costs by using Linux and OpenOffice
    > but the total costs of switching are enormous.

    Yes, the total costs of switching *are* enormous, but the savings in the longer term are *colossal*!! Once you've made the move then you're off the reverse gravy train forever.
    BrownieBoy-4ea41
  • @apexwm
    >> "They can save maybe up to 1% of their IT costs"
    > I'd like to know how you propose this number? MS Office costs hundreds
    > per copy, OpenOffice costs zero. Windows costs hundreds per copy, Linux
    > costs zero. Both require training and a learning curve so those hidden
    > costs will probably be close.

    There are plenty of public figures for total IT costs so you can do some maths, but I also have sources who worked for IBM. (IBM is *extremely* well aware of where enterprise IT money goes, and takes the largest chunk of it -- a far larger chuck that Microsoft.)

    > I have used OpenOffice since the days it was called StarOffice. It's an excellent
    > product. For free, it does the basics, and that's enough to suit most users.

    It's more or less adequate for people who have limited requirements and don't live in a world where everybody else they know is sending them complex Office documents. In the real business world, Open Office costs far more than it's worth in wasted staff time, so I reckon it's actually cheaper to use Office. (I certainly knew Sun staff who thought exactly that: you should have heard them bitching about it.)

    But as I said, it will be interesting to see what happens to OO now that Larry owns it....
    Jack Schofield