The necessity to migrate off Microsoft Windows XP and Windows 2000 in a tight time frame to Windows 7 will create an extra budgetary and resource burden on companies from 2011 to 2012.

• Demand for highly qualified Windows 7 migration IT personnel will exceed supply in 2011 and 2012, leading to higher service rates.

• Most organizations will need to find extra funds or redirect budgets away from other projects to complete the Windows migration on time.

• Overall migration costs can be reduced significantly by investment in zero-touch PC deployment processes and tools.

• Application compatibility issues may delay the start date for your organization's migration rollout.

• Build a migration plan that assesses how many of your organization's PCs will be replaced, and how many will be upgraded.

• Recognize the impact that the coming Windows migration crunch will have on your budget and other projects.

• Lock in external resources or train IT personnel to work on this project from 2011 to 2012.

• Prioritize investigation and testing of automation tools that can reduce migration costs.

Corporate IT departments typically prefer to migrate PC OSs via hardware attrition — i.e., bringing in the new OS as they replace hardware through a normal refresh cycle. Microsoft will support Windows XP for four more years. With most migrations not starting until 4Q10 at the earliest, and PC hardware replacement cycles typically running at four to five years (3.25 years for a notebook and a little less than five years for a desktop), most organizations will not be able to migrate to Windows 7 through usual planned hardware refresh before support for Windows XP ends.

Gartner research shows that most organizations will not complete their application migration and pilot testing of Windows 7 until 4Q10 at the earliest. This may be the best case. Organizations should anticipate that unforeseen application compatibility issues will lead to delays in starting a wider rollout. After organizations finish this preparatory work, they will be ready for broader production rollouts, which we expect will commence in 1Q11.

The official deadline for organizations to migrate to Windows 7 from Windows XP is April 2014, when Microsoft will end extended support, leaving the OS without security fixes or any other form of support. Most organizations' migrations should be well under way before April 2014 to minimize the potential for problems resulting from third parties terminating support for the OS (expected during 2013) and to leave a buffer zone in which to handle any complications that arise. Gartner recommends that organizations be off Windows XP by 2013 (see Figure 1).

Faced with this need to accelerate migration in 2011 and 2012, organizations have three options:

1. Accelerate PC replacement plans

2. Upgrade installed PCs

3. Evaluate partial migration

Attendees at Gartner Symposium/ITxpo events held at the end of 2009 were polled regarding Windows 7 upgrade. Survey results show that 11% of respondents plan a forklift upgrade, 33% plan to move solely by PC attrition, and 49% plan to move through a mix.

Buying new PCs with the OS upgrade ensures that machines have a full set of compatible drivers and a basic input/output system (BIOS). This course of action also reduces the number of times the machine is touched during its life and ensures that it will have a reasonably long operational life with the new OS over which to amortize the costs of the migration.

Assuming a 10,000 PC environment, where all PCs are replaced, the migration cost per PC will be between $1,205 and $1,999, depending on how well managed the environment is. These figures assume that 25% of the installed PCs will be replaced early.

While the overall cost to migrate is lower, the down side is that the capital costs account for about 60% of the total replacement cost, so the capital budget will be larger than in the upgrade case.

Using existing PCs will reduce the capital costs of migration, but will not reduce the labor costs of migration. Assuming the same setup as just mentioned — a 10,000 PC environment, where all PCs are upgraded — the migration cost per PC will be between $1,274 and $2,069, depending on how well managed the PC environment is. This assumes that 25% of the machines will need a hardware upgrade to run the OS.

Hardware and software costs in this case will account for approximately 50% of the total migration cost, equivalent to a capital cost of about $1,670 per PC. Of this, $150 to $200 would be for Windows license upgrades; organizations with Software Assurance would not have to pay this license fee.

The overall migration costs can be reduced significantly by investment in zero-touch PC deployment processes and tools. Gartner estimates that in the best case, an in-place upgrade can be done for $100 per PC or less, but this applies to less than 5% of organizations with the current OS.

One alternative that organizations should pursue is to familiarize themselves with Microsoft and third-party tools and processes that can help them during the migration. Microsoft has provided the Application Compatibility Toolkit and an enhanced set of deployment tools compared with previous OS releases. Compatibility tools and services are also available from companies such as App-DNA and ChangeBase, and traditional PC configuration life cycle management (PCLM) companies like Symantec have enhanced their products to support the Windows 7 migration. Using these products to automate some or all the migration-related tasks could significantly help reduce the burden on the organization.

Another drawback of upgrading is that these existing PCs will have a shorter useful remaining life compared with a new PC. While a newly installed PC would likely last four to five years before needing to be replaced, an upgraded system simply postpones the inevitable for two to three years. This will negatively affect the IT organization and employee productivity, as the greater diversity in the installed base will increase administrative complexity, and users will need to be migrated twice, rather than once, during a four-year period. Gartner recommends that if you choose to upgrade, upgrade only notebooks that are one year old or less and desktops that are less than three years old — but only if there are two years of useful life remaining on the machines.

For task workers such as data entry roles (these account for about 15% of the population in a typical organization), migrating from a PC to a hosted virtual desktop (HVD) environment is an alternative to PC migration. It would potentially speed up deployment because it is one image deployed centrally. However, an HVD does not solve the budget issues because of the incremental cost of the data center and network infrastructure needed to run an HVD. Also, it does not solve the IT support staff issue, since they will be involved in the HVD rollout.

A potentially valuable tool to ensure that the application compatibility is completed on time is to use a server-based computing (SBC) approach. In this case, difficult applications can be isolated and published centrally on the server. Most SBC deployments within enterprises are delivered on Citrix's XenApp (formerly Presentation Server) or Microsoft's Terminal Services.

Whether replacing or upgrading PCs, it is clear that Windows 7 migration will have a noticeable impact on organizations' IT budgets. Based on an accelerated upgrade, we expect that the proportion of the budget spent on PCs will need to increase between 20% (best case) and 60% (worst case) in 2011 and 2012. Assuming that PCs account for 15% of a typical IT budget, this means that this percentage will increase to 18% (best case) and 24% (worst case). This could have a profound effect on IT spending and on funding for associated projects during both those years.

Compounding this potential outcome is the cost of IT labor over the period. Most organizations have staffing that can handle normal operational activities and rely on external service providers to augment this when special projects arise (such as an OS migration or major PC refresh). However, with the vast majority of enterprises converting to Windows 7 in roughly the same narrow time frame, it is likely that skilled people will be in short supply. Finally, we expect the cost of IT labor to increase during 2011 and 2012 as demand for Windows 7 migration services spikes. These cost hikes are likely to continue in 2013, as organizations recognize that they are behind in their migrations. Gartner expects that large and midsize organizations worldwide will migrate approximately 250 million PCs to Windows 7 during the migration timeline.

Organizations that plan to leverage external services should line up service providers early. Begin talks with suppliers now about putting in place contracts that can deliver flexible levels of resources at a fixed rate over the migration period.

Whether you decide to replace or upgrade PCs, implement the following action items in advance of migration:

• Plan to minimize the labor component in all cases.

• Spend ample time in preparation and testing, and develop skills and processes needed for the migration.

• Invest in automation in 2010 and 2011.

• Start deploying Windows 7 on new PCs as soon as possible. If applications to support all users are not ready for Windows 7, consider deploying new PCs with Windows 7 to users whose applications are ready first.

• If you're considering HVDs, extend the life of those users' Windows XP PCs until you are ready to deploy Windows 7 on HVDs, and combine the two projects. (Recent Gartner polls indicate that about 25% of organizations plan to combine projects.)

• If you're upgrading PCs, then do so early to get more benefit from the migration during the rest of those PCs' lives.