Boost In Hardware Purchase With Windows 7 Launch

One of the company executive said that Intel Corp (INTC.O), the world's biggest chip-maker, expects the release of Microsoft's (MSFT.O) latest Windows 7 operating system to prompt corporate buyers to replace hardware in 2010.

John Davies, who is in charge of sales and marketing, told Reuters that with Windows 7 coming along, you would going to see that as a factor in corporate computer purchasing. That stuff would start moving the PC market.

Microsoft, whose software powers more than 90 percent of personal computers globally, released Windows 7 on October 22, aiming to win back customers annoyed by its earlier Vista platform.

Davies also added, declining to make any predictions for Intel sales that they would see Windows 7 now mainly in the consumer segment. The industry is still in pilots on it. In 2010 it would probably deploy Windows 7 and they will require latest hardware.

U.S. investment bank Morgan Stanley (MS.N) casted a shadow over growing optimism among investors and executives that an awakening in corporate and consumer spending would prop up chip sales, saying revenue growth could peak in early 2010.

Analysts also warn that U.S. unemployment, which is already above 10 percent, would depress consumer sentiment. Some are also saying that the bulk of computers at companies may actually be newer than four to five years old, which is a typical replacement age.

However, Davies said he was optimistic about a corporate inventory refresh cycle coming soon.

He also said that one cannot forecast these cycles perfectly, but they had a big one in 1999 with the Y2K and the dotcom burst, then there was a refresh about four years later and another one has to be coming soon.

Davies said, in the consumer segment, unemployment was not necessarily a hampering factor for computer sales.

According to him it is a harsh reality, but what they have seen is that the need for consumer computers is increasing. There is a lot of retraining and job-seeking going on, people have to be able to use 21st-century skills to compete for jobs.

He also stated that sales in emerging economies, especially in China and in Latin America, were growing.

At the same time, government purchases of computers for education around the world have increased over 20 percent.

Portugal last year released a program to supply school children with 500,000 ultra-cheap, locally-assembled laptops based on Intel's Classmate PC. Venezuela has already accepted to purchase 1 million of these from Portugal.

Davies has attended an Intel-hosted conference in Porto with representatives from 40 countries who discussed the need and use of computers for education and Portugal's example.

He said that they are only beginning to incline up this segment, it's going to take a long time. But there's a billion schoolchildren out there they could take the technology to, it's a tremendous potential.

In another development, The Asus Eee PC 1101HA is a laptop with an 11.6 inch, 1366 x 768 pixel display and a 1.33GHz Intel Atom Z520 processor. Asus is releasing a new model that runs Windows 7 Home Premium.

The new model is called the Eee PC 1101HA-WP, and it has 2GB of RAM and a 250GB hard drive.