Vista: Do operating systems matter anymore?

January 30, 2007, 11:51 AM UTC

Microsoftvista_1When Microsoft (MSFT) unveiled its Windows 95 operating system more than a decade ago, there were hot air balloons and a ferris wheel to punctuate the news. And the OS itself was a big star in the technology world: It promised to change the PC experience in bold ways.

But considering the less conspicuous spectacle this time around, one has to ask: Do operating systems really matter anymore?

On the most basic level they do, in the same way water heaters and indoor plumbing matter. We rely on them constantly, we expect them to be there, and we mostly care about them when they break. Tim Bajarin, longtime Silicon Valley technology analyst, told me operating systems matter because they manage our connections to our e-mails, our iPods, our world.

“Because the device itself has to manage memory, user interface, interconnectivity, various drivers of sorts, any device has to have a level of intelligence,” Bajarin says. “Unfortunately that level of intelligence has to be run through an operating system.”

On a more emotional level though, operating systems matter less than they ever have. If you have any doubt, consider that Apple’s (AAPL) upcoming iPhone is generating more buzz in tech circles than Windows Vista. Sure, Windows Vista is the next generation of software powering 90-plus percent of the world’s computers and nurturing a U.S. ecosystem that will sell $70 billion this year in related products and services, according to research firm IDC. Meanwhile, the iPhone remains an unproven object of gadget lust. We’re most excited these days not by a PC’s operating system, but by how quickly it can get out of our way and pull up that Web browser, or connect to that music player.

And there’s another level on which operating systems no longer matter like they used to: Compatibility.

A few short years ago, having a computer meant heavy use of a few key software programs for word processing, research, video viewing, online games and so forth. If your computer didn’t have the right operating system, some programs were out of reach. If you wanted easily portable documents, information at your fingertips and networked first-person shooters with high-end graphics, you had to own a Windows PC.

That’s seldom the case anymore. The ultra-compatible Firefox Web browser, online word processors and portable flash drives have leveled the word processing playing field for users on every platform. Google (GOOG), Wikipedia and other

online resources have expanded research options. Flash video on sites like YouTube are making viewing video as simple and universal as surfing the Web. And the Xbox 360 and PlayStation 3, new gaming consoles with the power of PCs, are making computer compatibility for games less of an issue.

Since more than 220 million PCs are sold worldwide each year, as Bajarin points out, operating systems are far from irrelevant. They’re even showing their importance in the latest generation of smart devices – phones and media players that have the communication power of PCs.

Even so, the world’s biggest OS company, Microsoft, is no longer king of the hill – and its best-known OS battle, Windows vs. Mac, is no longer center stage. Today, service providers like Google and device makers like Apple are grabbing our attention, even without the ferris wheels.