News

IDC Predicts Big Impact for Windows 7

Analysts forecast $18.52 in ecosystem revenues for every $1 to Microsoft for the OS.

• By Scott Bekker
• August 01, 2009

Market researchers at IDC are out with their predictions for the channel impact of Windows 7, which is set to become generally available in October.

In a research profile sponsored by Microsoft and released in July, analysts John Gantz, Al Gillen and Amie White wrote that IDC's forecast for Windows 7 uptake is brisk: 177 million unit shipments by the end of 2010.

"For every dollar of Microsoft revenue from launch in October 2009 to the end of 2010 from Windows 7, the ecosystem beyond Microsoft will reap $18.52," the analysts write.

Broken down by types of revenues, IDC projects that for every $1 of Windows 7 revenue that goes to Microsoft, there will be $10.21 in hardware sales, $4.43 in software revenues and $3.88 in services revenues.

IDC projects that the worldwide Microsoft ecosystem will sell $320 billion in products and services revolving around Windows 7 from October 2009 to the end of 2010. IDC's forecast for the U.S. ecosystem is $110 billion during the same period.

Job Creation
The market researchers also anticipate an employment opportunity for the operating system, which comes nearly three years after the debut of Windows Vista. Worldwide, IDC expects that more than 7 million people in the IT industry and at IT-using organizations will be working with Windows 7 by the end of 2010. According to IDC, that's 19 percent of the global IT workforce. Broken down, that's about 3 million people in the channel and 4 million in IT-using firms.

Looking at the Windows 7 employment picture from the United States, IDC says about 2 million people will be working with the OS by the end of 2010, with about 700,000 of those people working in the channel and 1.3 million working at IT-using firms.

In the report, IDC also tried to calculate the net gain, or economic "bounce," from the launch of Windows 7. In other words, what would the market look like if Windows 7 didn't launch?

"IDC expects that employment related to client operating systems will grow by more than 300,000 new jobs or more than 30 percent of total growth in global IT employment in 2010 solely because of the launch of Windows 7," the analysts write.

Partner Profits
One other way the analyst firm looked at the impact was by partner type. According to IDC, for every $1 of Windows 7 revenue that goes to Microsoft:

• $9.29 will go to product-oriented partners, or companies that derive 60 percent or more of their revenues from internally created products such as software or hardware.
• $4.14 will go to service-oriented partners, which IDC defines as companies such as systems integrators and consultants that get 60 percent or more of their revenue from internally created services and less than 20 percent of revenues from resale of third-party products.
• $4.23 will go to value-added resellers, getting 20 percent or more of their revenues from resale and 20 percent or more from internally created services.
• $5.76 will go to logistics-oriented resellers that derive 60 percent or more of their revenue from resale of third-party products.
• $6.42 will go to retail-logistics resellers that make 80 percent of their revenues from resale of third-party products to consumers.