Small and mid-size businesses are expected to adopt the new Microsoft Vista operating system at a rate that is 50 to 60 percent faster than larger companies in the second half of 2007 and the first half of 2008, according to a recent study by Cowen & Co., the investment bank. And Microsoft is counting on small business uptake of its newest version of the Windows operating system software to create a critical mass of buyers and make Vista the new industry standard.

But while Vista is here and small and mid-size businesses are getting their first solid look at the operating system, for many the verdict is still out.  On one hand, the new Aero interface is more graphically pleasing and in many ways much easier to use; on the other, the feature-rich user interface hogs a lot more CPU resources, and many small businesses are wrestling with application and driver compatibility challenges.

Some end users are questioning the benefits of moving at all -- noting that there are limited functional differences compared to the XP operating system that currently permeates the small business computing environment.

Still, given the better interface, speedier search capabilities along with the fact that Microsoft has no plans to stop aggressively marketing Vista, there’s little doubt that small and mid-size businesses eventually will make the shift. 

When and how to switch

The question is how quickly should your business migrate to Vista? Analysts at Gartner think it will happen at a fairly rapid clip, and that small business adoption of Vista will continue to outpace large enterprise penetration for the foreseeable future.

The main reason:  small businesses don’t worry as much about managing complex mixes of operating systems within their organization, says Annette Jump, an analyst with Gartner. They generally run several operating systems within their environment. Gartner expects small businesses to adopt Vista more quickly than medium-size businesses because they make individual hardware purchases, including PCs, through consumer channels, such as retail or PC stores, rather than from professional channels, such as value-added resellers. Indeed, Gartner expects that the consumer versions of Vista will remain in use among small businesses and will account for 9 percent of the PC installed base among small businesses in 2007.

Mid-size companies will take longer to migrate and will begin doing so in the middle of 2008 after ensuring that all mission-critical business applications are supported by Vista. Until then, they will continue to use PCs running Windows XP; Vista will make up less than 6 percent of the PC installed base in midsize companies this year. By 2009, however, Vista is expected to surpass XP as the primary OS, with 48 percent of installed PCs running Vista.

The reasons to suffer through migration

In initial reviews of Vista, there have been some notable enhancements, including better user access control (UAC) which provides more granular control of permissions and local security, enhanced group policy control, and an enhanced event viewer.

Loren Swanson, technical operations manager for Homegain a 100-employee firm that connects real estate professionals with homeowners and homebuyers online, likes the faster search capabilities on Vista, which are more akin to the consumer search engines that mine the Internet for information.

Still, he is just in the initial stages of evaluating Vista in the labs for his company and has not officially rolled out the software to his staff. At this point, he’s in no real hurry. “From a user perspective, it does not offer a tremendous amount of new upgrades,” he says. He adds that there’s not much more that a user can do in Vista that can not be done in XP.

Moreover, Swanson says that Vista is not currently compatible with the company’s voice over IP (VoIP) phone system from Shoretel, although the phone maker is expected to release a version that is Vista compatible shortly. So, while every user at Homegain is currently licensed under the enterprise agreement with Microsoft for Vista, there are some compatibility issues that still need to be squared away.

It’s not an uncommon situation, says Ian Lao, senior analyst with consulting firm In-Stat, a high-tech market research firm based in Scottsdale, Ariz. These types of compatibility issues will be considerable for small and mid-size businesses. He says it's important for small businesses to be aware of compatibility issues with legacy systems and application and support for current hardware as they begin their migration planning.