PC Industry Gathers to Defend Windows 98 and Continued Innovation

PC Industry Gathers to Defend Windows 98 and Continued Innovation

NEW YORK, May 5, 1998 — More than 50 representatives of the personal computer industry – including the largest manufacturers of personal computers, software developers of all sizes, retailers and technology companies nationwide – today joined with Bill Gates, chairman and CEO of Microsoft Corp., to call attention to the importance of an on-schedule release of the Microsoft® Windows® 98 operating system to consumers, the PC industry, businesses and the U.S. economy. Windows 98 is currently scheduled to debut June 25.

“Windows 98 offers a breadth of opportunities for the entire PC industry,”
said Eckhard Pfeiffer, president and CEO of Compaq Computer Corp., the largest PC manufacturer in the world.
“This product provides a platform that enables innovation for PC manufacturers, hardware vendors and software developers. Ultimately, customers will be the winners when Windows 98 ships, because there will be a wide range of new products that take advantage of the latest technologies.”

The unprecedented show of support for Windows 98 comes in the face of speculation that several state attorneys general and the U.S. Department of Justice are considering possible legal action that could delay or halt the introduction of Windows 98, a move industry leaders said would unnecessarily deprive consumers of the latest PC technologies and have a dramatic impact on the entire industry.

Among the PC industry representatives who joined Gates in highlighting the importance of Windows 98 were the following speakers: Pfeiffer; Jim Halpin, president and CEO of CompUSA; Bill Krause, president and CEO of Storm Technology Inc.; Ted Johnson, executive vice president and chief technology officer of Visio Corp.; Dr. N. Gregory Mankiw, professor of economics at Harvard University; and dozens of other hardware, software, customer support and technology companies. Consumer groups representing the disability community and end users also attended the event.

“In America, innovation is progress and progress means economic growth for the PC industry, for consumers and for the nation,”
Gates said.
“Windows 98 is important not only to Microsoft, but to the PC industry as a whole. PC manufacturers, hardware vendors, software developers, resellers and retailers are incredibly excited about the market opportunities driven by Windows 98 innovation and how this new product will benefit millions of consumers.”

PC Manufacturers and Customers Highlight Negative Impact on Business

PC industry representatives, supported by economic experts, also cautioned that a delayed release of Windows 98 could result in negative implications for customers, businesses and the economy.

Participants today cited U.S. Commerce Secretary William Daley’s recent report,
“The Emerging Digital Economy,”
as evidence of the vibrance, innovation and competition in today’s PC industry:

  • America’s information technology (IT) industry is growing at more than double the rate of the overall economy and today represents 8.2 percent of the gross domestic product.

  • The IT industry has driven one-quarter of total real economic growth in the U.S. in each of the past five years.

  • More than 7 million Americans work in IT jobs.

  • Without the IT industry, inflation in America last year would have been 50 percent higher.

Microsoft Chief Financial Officer Greg Maffei recently reported that postponing the release of Windows 98 could result in substantial and unnecessary costs to the PC industry and the U.S. economy because of lost revenue, deferred sales, stagnant inventory, wasted marketing and advertising expenditures, and lost training, jobs and opportunities.

“It is hard to fathom why government policymakers are now considering denying consumers access to the next-generation technology,”
said Mankiw.
“Such a policy would impede the process that leads to long-run growth in productivity and living standards. It would throw sand into the gears of human progress.”

In terms of the PC industry itself, any delay in Windows 98 could have immediate and harmful effects for each of the various players, including PC manufacturers, retailers, resellers, software developers and, ultimately, consumers. For instance, major national retail outlets, such as CompUSA, have invested heavily in preparing to market Windows 98.

“CompUSA employs more than 17,000 people in 38 states whose livelihoods depend on the continued growth of our business,”
Halpin said.

CompUSA is planning for the launch of Windows 98 to be a catalyst for sales and to generate major excitement throughout the category.

“CompUSA has already made significant investments in upfront marketing and advertising that cannot be recouped if Windows 98 is delayed or halted. In the end, we believe the customer will suffer.”

PC manufacturers also are concerned.
“Windows 98 is the catalyst for incredible PC hardware advancements – it is the innovation enabler my customers are asking for,”
Pfeiffer said.

Other industry players also stand to be affected. According to the Association for Software Competitors, which participated in today’s event, there are approximately 2.2 million software developers in the United States that design products to work with Windows; that number increases to 5 million around the globe.

“Visio has benefited significantly from the innovation inherent in the Windows operating system,”
said Ted Johnson, executive vice president and chief technology officer for Visio Corp.
“We encourage and support Microsoft as it continues to make valuable innovations to its operating system. This allows software vendors like Visio to direct more of our time and development dollars to specific product improvements that our customers are asking for.”

Founded in 1975, Microsoft (Nasdaq
) is the worldwide leader in software for personal computers. The company offers a wide range of products and services for business and personal use, each designed with the mission of making it easier and more enjoyable for people to take advantage of the full power of personal computing every day.

Microsoft and Windows are either registered trademarks or trademarks of Microsoft Corp. in the United States and/or other countries.

Other product and company names herein may be trademarks of their respective owners.

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