According to Aberdeen Group, a Boston-based research firm, there are more than 50 million aging computers sitting on desks in offices around the world. These PCs were built before the millennium -- many were purchased in 1998 and 1999 in anticipation of Y2K problems. Smaller businesses often purchased consumer machines with Windows 98, while mid-sized companies deployed Windows NT desktops.
Three weeks ago, however, Microsoft pulled the plug on Windows NT 4.0 Workstation: The operating system's no-cost, security-related patch or "hotfix" and pay-per-incident help "extended support" period -- the two-year term that follows Microsoft business software's five-year "mainstream support" window -- ended June 30, 2003. And Windows 98 and 98 Second Edition will go by the wayside on January 16, 2004.
Routine user support is rarely an issue for software that's been in use for so long. But the cessation of patches for security flaws or fixes for new security threats leaves older desktops -- a lot of older desktops, according to informal Gartner Group polls last fall in which over one-third of U.S. and half of European respondents said they still had some NT systems deployed -- at risk. That's a vulnerability no business can afford to ignore.
The question is, what should you do to fix this business computing conundrum: refresh or refurbish?
Experts anticipate that the long-awaited PC refresh cycle is finally gaining momentum, as companies examine systems that were last upgraded for Y2K. One pressure point is that businesses can no longer afford to hang on to old machines as increased computing power is required to support new operating systems and applications.
That's why, while much of the IT news today highlights this fall's release of Microsoft Office 2003, a product that's now gaining traction in the small-business market is Windows XP -- the operating system introduced in October 2001.
A Refreshing Change
According to Aberdeen analyst Peter S. Kastner, midyear is an auspicious time for starting or accelerating a PC replacement cycle with Win XP: "Windows XP Professional Service Pack 1 is out in the field and working well indeed," he explains. "No stability problems here. It's a great client operating system on today's more powerful desktops and laptops."
Greg Sullivan, Microsoft's lead product manager of the Windows division, sees several reasons why small businesses are migrating to XP: "XP is a way for small business to leverage current IT trends. [It] provides the mobility that small businesses want while allowing for the integration of software with Web services, which ties all the most recent advances together."
Before Windows XP, Sullivan says, small businesses that wanted to leverage new technologies had to hire a consultant to determine if deployment was feasible, then buy a solution from a reseller and work with an integrator to implement it. Today, he claims, "average guys" can take immediate advantage of the latest computing power.
"Small businesses can take an off-the-shelf software solution and implement it in their system themselves," Sullivan said. "This used to be cost-prohibitive for many [offices]."
As a result, Sullivan says, Windows XP is the fastest-selling operating system in Microsoft's history, with more than 100 million licenses now in use -- many in small- to mid-sized businesses -- and 20 million sold during the first three months of this year.
Macro Hardware Trends
Matt Millen, Gateway's small and medium business vice president, says that an end-of-life OS is just one element driving the move to replace aging computers: "What's really driving change in the small-business market is technology. Even the smallest firms are often forced to upgrade technology in order to continue to do business with larger companies."
The surge in sales of notebook versus desktop PCs is one example. "Clearly there is a macro-level trend toward mobility for SMBs," says Millen. "The cost of mobility is down, and power and convenience are up. We're seen a 50- to 60-percent [sales] increase in our mobility products."
Millen adds that old IT lines are blurring, spurring Gateway to reposition itself as a one-stop shop for companies grappling with converging technologies: "High-end desktops have blurred into workstation PCs. Back in the '90s we had telephony value-added resellers for phone systems and IT providers for networking, but then networks [moved] into the same closet as the phone system, VARs got into each other's space, and unrelated verticals -- the network and the telephone -- came together.
"Consumer electronics and IT are the next convergence point -- bringing together AV and IT, along with commercial business applications for these products." He adds that one of Windows XP's key benefits in this new environment is its ability to recognize and adapt to different types of local- and wide-area networks and wireless connections.
Taking Their Own Advice
Kastner recalls that, last year, Aberdeen itself had offices full of old PCs running Windows 98. Even though the research firm disliked the idea of spending cash in a down economy, Aberdeen analyzed the business situation and decided that it couldn't afford not to replace its PCs.
"We could not afford the aggravation and potential disruption to our knowledge-worker-driven business of not doing so," he says. "Tough medicine, we concluded, but common sense."
The mantra used to be that information technology followed a three-year upgrade cycle. Now, with companies discovering that, while old 100MHz desktops are definitely due for replacement, many 500MHz or 750MHz systems are still adequate for daily office tasks, it's Microsoft's seven-year support cycle that's spurring IT managers to discover the benefits of new platforms like Windows XP.
And history will probably repeat itself. Microsoft's Product Support Lifecycle pages say that Office 2000 will hit the wall as of June 30, 2006, with Windows 2000 Professional following on March 31, 2007.
