Could Windows 7 lift the PC market from a record slide

It seems like the bad news just doesn’t stop coming as Gartner has a report out today that the PC industry could see a record unit decline that even surpasses the one that happened in 2001. From their press release

The PC industry will experience its sharpest unit decline in history, with PC shipments totalling 257 million units in 2009, an 11.9 percent decline from 2008, according to Gartner, Inc. Previously, PC units experienced their worst decline in 2001 when unit shipments contracted 3.2 percent.

“The PC industry is facing extraordinary conditions as the global economy continues to weaken, users stretch PC lifetimes and PC suppliers grow increasingly cautious,” said George Shiffler, research director at Gartner.

This kind of news has people like John Paczkowski from Digital Daily suggesting that this is really bad news as well for companies like Intel, AMD and Microsoft. After reading that I got to wondering about something – given that there is a really strong possibility that rather than the 2010 release date for Windows 7 that Microsoft is sticking to we will see a fall of 2009 release and that this could have a real positive effect on the PC market.

I don’t think there is anyone in the industry who would tell you how bad of a flop Vista has been for Microsoft. Sure it still made money for the company but nothing like it could have. More and more talk about how people and companies are going to be sidestepping Vista altogether, instead opting to wait for Windows 7. Now typically the end of year sales for PC is a immensely critical time for PC makers and when Vista crashed and burned by missing that release window for Vista it rippled through the industry.

This is one of the reasons why – especially from Microsoft’s point of view – that it can’t let this happen again. Tie that in with the current projections of a PC marketplace desperate to stop its own bloodbath and one has to wonder if Microsoft does release Windows 7 in time for the Christmas buying season whether or not is will indeed reverse the downward spiral of the PC.

I’m not so sure though if it will given the spreading economic crisis but here’s a what if to consider where Microsoft could have a real positive effect. What if they were to take the top consumer version and the best small business version and slash their prices to both the individual and for small business; and I don’t just mean some fancy but useless 10% discount. I mean cut the price to just above barebones profit margin.

This would give OEMs the opportunity to be able to actually included it as part of the PC without A) having to jack the price of the computer up to offset their cost of the OS and B) it would encourage not only single upgrade purchases of the OS but also multiple purchases of the OS by individuals and small business. I know myself I am waiting for the line to form to be able to buy a copy of Windows 7 but I also have another computer in the household that I would love to upgrade to it as well but if the cost is more than I can afford given Microsoft’s past pricing schemes it won’t happen.

The chances of them doing something like this is probably next to nil but I think that if they did it could potentially have a really good effect on the industry as a whole – just when we could use it the most.