The highly awaited launch of Microsoft Inc.’s Windows 8 operating system should give some Orange County companies a bump going into the holiday season, but expectations are tempered by sluggish computer sales.
Santa Ana-based Ingram Micro Inc. and Vizio Inc. in Irvine may have the most skin in the game locally.
Ingram, the world’s largest technology distributor with $36.3 billion in sales last year, has four business divisions and hundreds of employees supporting Windows 8 since its Oct. 26 launch.
The company has a unit devoted solely to Microsoft that educates resellers on using and trouble-shooting the products, cross-selling opportunities and strategies for reaching small and medium-sized businesses.
The division was established four years ago and last month launched a nine-month initiative to train thousands of resellers on Microsoft’s operating system. It previously trained 300 Ingram sales representatives on the system and its benefits.
Ingram
Ingram representatives recently embarked on a 20-city tour in the U.S. and Canada to link manufacturers with Microsoft experts with the goal of boosting adoption in wireless devices.
“We’re hitting it from all different angles,” said Jennifer Anaya, Ingram’s vice president of marketing for North America. “We see a lot of opportunity.”
Ingram operates under razor-thin margins, typically netting less than a penny on the dollar. Resellers aren’t optimistic Windows 8 will bring higher margins. Three out of four service providers rated Windows 8 as generating average or low margins, according to an industry survey by CRN Tech News.
Microsoft has sold more than 4 million copies of Windows 8, Chief Executive Steve Ballmer said recently during the company’s annual development conference at its headquarters in Redmond, Wash.
Vizio
Vizio recently released its first line of PCs, ultrabooks and notebooks equipped with the Windows 8 operating system.
The new computers are billed as enhancing picture quality, boosting contrast and producing wider viewing angles. The lineup also features Microsoft’s Signature app, which removes unwanted trial applications and software that can slow down computing speeds.
Vizio has distribution deals lined up with retailers Wal-Mart, Sam’s Club, Amazon.com and MicrosoftStore.com.
The global PC market had high hopes entering 2012, as the new ultrabook segment prompted broad enthusiasm at the International Consumer Electronics Show, coupled with expectations for the Windows 8 launch. But PC sales now are pegged to drop 1.2% to 348.7 million units this year, according to Englewood, Colo.-based market tracker IHS Inc.
Irvine-based Western Digital Corp. late last month released one of the first portable hard drives designed for Microsoft’s Windows To Go product, which enables corporate customers to access Windows 8 on a USB drive if they have an earlier operating system.
My Passport Enterprise retails for about $120 and is expected to give Western Digital at least a marginal sales bump, spokesperson Heather Skinner said.
“We see Windows 8 affecting our business, especially as users back up their data and as digital content increases,” Skinner said. “Storage is a must-have, and Windows 8 will be a driver to that.”
Western Digital is the world’s largest disk drive maker in revenue and unit shipments. The company posted sales of $4.04 billion and an adjusted profit of $594 million in the September quarter.
It shipped 62.5 million hard-disk drives in the quarter, up from 57.8 million a year earlier.
Hard-disk drives store and allow access to data. Western Digital’s disk drives go into computers, external storage devices, corporate networks and consumer electronics such as DVR players.
Kingston
Fountain Valley-based memory products maker Kingston Technology Inc. also released a product geared for corporate customers upgrading to Windows 8.
The Kingston DataTraveler Workspace USB flash drive is certified for Windows To Go and allows users to boot up and operate Windows 8 from portable devices. Kingston worked with Microsoft over the last year to develop the flash drive, which is designed to help information technology administrators support mobile workers, contractors and consultants.
The company doesn’t expect a significant uptick in sales with the new product line, a spokesperson said.
Dram
Kingston is the world’s largest maker of memory products for computers and consumer electronics. The Business Journal estimated Kingston had sales of $5.8 billion in 2011, down 11% from a record $6.5 billion posted in 2010 amid a global surge in sales of DRAM products, the most common type of memory used in computers and Kingston’s biggest source of revenue.
Windows 8, unlike previous Windows launches, isn’t projected to generate a significant rise in DRAM shipments in the fourth quarter. That’s because it lacks more advanced system requirements than previous versions, limiting the need for more memory.
Quarterly DRAM shipments soared more than 40% after the release Windows 98, Windows 2000 and Windows XP in 2001 but have steadily dropped with the last three operating systems.
