Ballmer: Windows 7 sells twice as fast as past operating systems

He dismisses Mac's market share gains

Microsoft Corp. said today that Windows 7 has sold twice as many units as any other Microsoft operating system in the same time period.

During its annual shareholders' meeting, CEO Steve Ballmer also dismissed market share gains by Apple Inc.'s Mac computer to "a couple of tenths of a percent" and said that many young people would eventually outgrow their preference for Macs.

"Some of it is marketing, some of it is phase of life," Ballmer said in response to a shareholder question about Microsoft's poor perception among younger buyers. "The truth is we do quite well, even among college students.

"Windows 7 gives us a real opportunity to get back that audience," he continued. "With the down economy, people understand that the Mac is a lot more expensive for essentially the same computer" as Windows 7.

NPD Group reported earlier this month that first-week retail sales of Windows 7 in North America were 234% higher than Vista's were at launch. Those Windows 7 sales include pre-orders that Microsoft and partners began taking in June.

The Mac has been making strong market share gains for most of this decade, though that has been limited mostly to North American consumers. In the most recent third quarter, Apple's unit shipments grew 6.8% year-over-year to give it 8.8% of the U.S. market, according to Gartner Inc. It ranks in fourth place, behind Dell Inc., Hewlett-Packard Co. and Acer Inc.

Ballmer said Microsoft plans to keep investing in Web search, the Windows Mobile operating system and cutting-edge technologies, such as the Xbox's in-air motion controller, Project Natal.

He defended the Windows Mobile OS from a questioner, saying it was a "small but important fact, that we have quite a bit more market share than Android. We have about 10%-12%, Android has 3%, iPhone about 20%, RIM 20%-25%, and Nokia about 45%."

"It is a competitive game," he continued. "We have a lot of opportunities to improve our products and market position."

Addressing persistent rumors of a Microsoft-manufactured phone, such as a Zune Phone, Ballmer said, "We think we have the right strategy, which is to focus on the software, not build a phone, and offer a diversity of phones like we offer a diversity of Windows PCs."

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Eric Lai

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