Windows 95 Sales Slow As Initial Hoopla Fades Highly Touted Microsoft Product Falling Short Of Sales Projections
You can spend millions of dollars, even light up the Empire State Building, but you can’t make everybody rush out and buy your product.
That seems to be the lesson from the hoopla surrounding Microsoft Corp.’s Windows 95, and even more so for an earlier much-trumpeted product, Microsoft Bob.
Sales of the Windows 95 operating system software “are definitely going down,” said Nicole Field, an analyst at PC Data in Reston, Va.
Her firm estimates that Windows 95 sales in the United States peaked at $108 million during the product’s first week on the market in late August. Since then, retail sales of the software have steadily declined, dipping to about $33 million for the week of Sept. 14-20, she said.
PC Data estimates that total U.S. retail sales of Windows 95 have reached about $240 million.
That puts the number of copies of Windows 95 sold through Sept. 20 at about 2.75 million, a far cry from the many millions predicted by analysts.
Company officials said they were comfortable with sales, describing them as “on target.”
Few analysts doubt Windows 95 will one day run on tens of millions of computers as Microsoft eventually discontinues sales of Windows 3.1, the previous version, and people buy new computers loaded with the new operating system. The question is how fast the changeover will take place and whether today’s computer users will dump Windows 3.1 and upgrade. These factors will have a significant impact on Microsoft’s financial performance.
The unachieved projections are now attributed not to consumer rejection of the product, but to analysts who were carried away by the hype of the launch. “There are a lot of breathless analysts out there,” said Josh Bernoff, a senior analyst at Forrester Research Inc. of Cambridge, Mass.
His firm predicts that by the end of the year, with a boost from holiday sales, U.S. consumers will have bought fewer than 5 million copies of Windows 95. That would mean that about 17 percent of personal computers in the United States would be running Windows 95. “That’s not taking the world by storm,” Bernoff said.
Even so, analysts are quick to point out that Windows 95 has enjoyed stronger sales than any other software product in history. When Forrester analysts tally up sales overseas and to corporations, it expects Microsoft will sell close to 12 million copies this year. IBM’s competing operating system, OS/2, has sold about 10 million copies since 1989.
Another product introduced with fanfare, Microsoft Bob, which aims to make using a computer far easier to use for novices, has won fewer fans since it hit the market in January. “I remember Bob,” quipped Bernoff. “The retailers I spoke to had crates of it lying around and they were very disappointed.”
Kathleen Schoenfelder, a Microsoft manager, said Bob sales are meeting the company’s forecasts. Retailers might feel disappointed, she added, because they “were influenced by all the press and ordered at levels beyond which we had recommended.”
Tim Bajarin, an analyst with Creative Strategies Research in San Jose, said Bob didn’t solve a problem faced by enough computer users.
“The whole idea was to try to demystify the PC,” Bajarin said. But “there are a lot more savvier customers out there than anyone expected.”