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NPD: Early boxed retail sales of Vista down nearly 60% compared to XP

But 30% of those buying boxed Vista want the pricey Ultimate version

By Eric Lai
February 15, 2007 12:00 PM ET

Computerworld - First-week retail sales of boxed copies of Windows Vista were almost 60% below sales of boxed copies of Windows XP in the week after its 2001 launch, according to one leading market research group.

The dollar value of retail box copies of Vista sold during the week of Jan. 28 also fell 32% from the value of XP box copies sold during its first week in October 2001, according to figures from Port Washington, N.Y-based NPD Group Inc. released Thursday.

However, retail sales of PCs, virtually all of them sporting the new Vista operating system, were up 67% over the same week in 2006. While that is hardly an apples-to-apples comparison -- many stores were clearing out their XP inventory in the weeks leading up to Vista's launch -- "it still reflects a fair bit of growth," according to Chris Swenson, a software analyst with NPD. He declined to release exact dollar figures.

Swenson's interpretation of the seemingly in conflict numbers? Consumers are "getting the message that they need a more robust system to take advantage of some of the new features in Vista," he said in a statement. Thus, a smaller number of consumers are opting to upgrade their existing hardware with Vista out of fear that it won't be powerful enough.

Vista's poor retail sales contrast with Office 2007's strong first-week retail sales, which more than doubled Office 2003's first-week sales.

The good news for Microsoft: Consumers who are upgrading to Vista on their older machines are opting for pricier, higher-end versions of it. The average selling price of Vista was $207.13, up 66% from the average selling price of XP. That was due in part to the fact that more than 30% of the copies of Vista sold were the Ultimate version, which lists for $399.

"So, although total dollars were down compared to XP, I think the preliminary data shows that Microsoft's gamble on a new high-end Vista SKU will help keep dollar volumes from declining as rapidly as unit volumes in the near term," said Swenson.

Swenson also expects that retailers with "tech benches" such as Best Buy's Geek Squad, CompUSA's Tech Pro and Staples' Easy Tech will see a boost in sales because of customers seeking help with installing Vista. Those services are often offered at attractive prices to consumers, said Swenson, who expects a "bump" in sales similar to that caused by security software.

NPD's data was collected from a number of retailers, including Amazon.com, Best Buy, Circuit City, CompUSA, Kmart, Office Depot, OfficeMax, Staples, Target and others.

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