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Microsoft benefits from direct sales - PC Retail

Microsoft benefits from direct sales

Trial software sees manufacturer become second largest seller of Office 2007
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Following on from yesterday's news that Microsoft's new operating system Vista was struggling to outsell its older sibling, XP, further analysis of NPD's figures have shown that Microsoft has become the second largest vendor of its own office productivity software.

The Redmond-based software company has traditionally shied away from distributing its own products and has relied heavily on the channel.

However, with the increase in Internet penetration and ever increasing download speeds, coupled with an increasingly competitive magazine market where covermounts often decide whose magazine is purchased, Microsoft has found itself in the unique position where many customers who would have traditionally purchased the new version of Office from retailers are now obtaining trial versions and then subsequently purchasing the license from Microsoft directly.

Indeed, such as has been the shift in the way customers purchase their copies of Office that Microsoft has gone from almost zero per cent market share to nine per cent, making it the second largest vendor of its own software.

"Microsoft is now the second largest retailer of its own productivity suite," said NPD analyst Chris Swenson.

The report also revealed that despite Apple slowly biting into Microsoft's market share, it is not losing any sales – in fact, it may be seeing an increase.

"Microsoft isn't losing as much of the OS sale as you would think from people switching to the Mac," Swenson said. Microsoft is increasingly seeing more people buy copies of Windows to run on their Macs via software like Parallels, which has sold 650,000 copies since its initial release.

The report however stressed that it was unclear how many customers were buying which version of Microsoft's operating systems to use with virtualisation software.

What the report did however reveal was that Microsoft's Mac version of its office software suite, Office for Mac were on the increase with it accounting for a huge 20 per cent of all retail sales in NPD's sales data for the first six months of 2007.

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