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Dell expects slow Windows 8 demand in enterprise

Surface won’t be more than 2% of market

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Microsoft is betting big that Windows 8 will revive its flagging fortunes, but the feedback from Dell is that the new operating system will be a consumer release, and it's not expecting too much impact from Redmond's Surface tablets either.

In the earnings call to discuss its latest financial results, Dell's CFO Brian Gladden said the introduction of Windows 8 in October would have a limited effect on Dell's results at first, since the company is really focusing on enterprise systems, and he expects the new OS to have limited appeal early on in that sector.

"We still feel to feel good about the refresh opportunity and only see about 50 per cent of the Windows 7 transition is complete," he said. "That's going to continue over the next several quarters here before anybody really thinks about Windows 8 on the commercial side."

Gladden said there was some interest in Windows 8 among customers who are considering tablets in the enterprise, particularly given the security features Microsoft is touting. This could be a catalyst for greater enterprise adoption, and some resellers are drawing down stock in preparation, but Dell isn't expecting the earth to move when the new OS comes online.

Nor is it particularly worried by Microsoft's entry into the hardware market with the Surface. CEO Michael Dell said that he had been in consultations with Redmond over this and was satisfied that a diverse market wouldn't hurt Dell's revenues.

"The number of [Surface] units will be a relatively small percentage, probably one or two per cent of PC units to the middle of next year," he said.

It's not all bad news for Redmond, however. Dell said that the release of Windows Server 2012 would give a boost to the second half of the company's year and it was "feeling good" about the new OS. ®

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