Microsoft goes in hard with Windows 7 target

Calin Tatomir, GM of Microsoft Romania, says his hardest task at the company has been changing deep-rooted mentalities, sustained by Romania’s economic growth, into adaptable and flexible outlooks. Microsoft is in a busy period locally: it will launch Windows 7 in just a few days and move to new headquarters at the beginning of 2010. Already, 100,000 Windows 7 systems have been downloaded in Romania, but Tatomir’s ambition is to sell just nine months as many Windows 7 as Vista sold in years. The company works with over 3,500 partners in Romania, and the GM says he has no information about Microsoft’s mooted software center in Craiova.

Tell me about your employee recruitment process…

Microsoft Romania has 313 employees, split into three teams: the sales and marketing team, the global support center, with the third team being the company Ciao from Timisoara which Microsoft acquired. The biggest one is at the global support center, where there are probably around 160-170 employees. I think over the last 12 months we have increased the number of employees at the center by 20-25 percent. Our estimations for the next 12 months are along the same lines, between 10 and 20, maybe even a 30 percent growth in the number of employees. The center offers technical expertise and support to all French- and German-speaking countries. So the team members speak German and French fluently and they are dedicated, technically speaking, to certain Microsoft products.

I should add that around 20-30 percent of the employees at this center are not Romanian. They are from Africa, the United States and Western Europe. I even discovered that we have an employee from Senegal. We recruit them in various ways, starting from the HR department to certain personnel recruitment partner-companies. We participate in many job fairs and also work with sites who suggest candidates to us. It is a multiple process and not only at national level.

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What are the trends on the IT market and how has it been affected by the crisis?

From our point of view, the IT market in Romania was one of the worst affected. I recently saw some statistics which showed that the demand for labor, which was traditionally very high in Romania in IT, had decreased by 60 percent. But it is clear the IT market has been hit at the level of the entire Central and Eastern Europe. As far as Romania is concerned (and I would also add Poland), it is on the list of countries that have very good prospects for 2010. All the statistics that I have seen so far show that Romania and Poland are the only two countries that have a chance to grow slightly in 2010. First of all, because of the size of the population, since they represent rather good markets for those who wish to invest in this region. The forecasts show something like 0.5 percent growth in 2010, maybe a little more.

Are you tempted to work on public projects during this unstable period?

Microsoft Romania does not bid directly for projects with the state; we are represented by our partners. This type of business has very often fallen short of our expectations. We are frequently disappointed when we see projects cancelled or postponed. During the last fiscal year (ended on June 30, 2009), the result was somewhat disappointing in the public sector, precisely because these projects that we were counting on did not happen. I don’t think more than 20 percent of our total revenues come from the public sector. I would say that 30-35 percent of the turnover comes from the residential sector and 25 percent from SMEs. But it is a rather hazy appreciation, since these sectors can overlap.

You are moving to new headquarters, I understand…

Some time at the end of January or the beginning of February, we will move to a new headquarters in one of the towers in Free Press Square (ed. note: City Gate). We have a telesales team which is in a third location in Bucharest and we are trying to channel our energy into one single area. The telesales center will remain where it is for now because it covers three stories and has a dedicated purpose. In the building where we’re going to move there will probably be some space left and, if we can, we will try to make this move. The space is rented.

How do you expect Windows 7 to perform in comparison with Vista?

In Romania alone, over the last few months, over 100,000 Windows 7 have been downloaded, and the launch has not yet taken place. I think that here, Vista makes up 20 percent of the operating systems market. It did not have such a large deployment scale, precisely because it was the first operating system created by Microsoft that was extremely complex but, nevertheless, there were certain things that were not well tuned, such as the execution speed. I still maintain my aim that, in at most nine months, the market share of Windows 7 will surpass that of Windows Vista. It is a very aggressive vision but we hope to get there. We hope that at the end of the fiscal year (in June 2010), at least 70-80 percent of Windows 7 systems will be pre-installed ones. We are not sure this will happen but it is our target.

How does Romania rank in terms of the adoption rate of Windows 7?

Statistics say that in first place for the degree of adoption of Windows 7 is one of the Baltic countries, and that Romania is second. Romania is very visible in IT at world level. Here, there is the Microsoft competence center, Oracle, IBM, Hewlett Packard, Alcatel and Siemens. Nearly all large companies have competence support centers or call centers here. Let us not forget that 10 percent of the country’s GDP goes into IT&C. Consequently, of course, the adoption of Windows 7 is also due to the maturity of the IT community in Romania which is highly appreciated, mature and technically savvy.

What are the most popular operating systems on the local market now?

At this moment, XP is definitely above Vista for the degree of use. If we consider reported use (and we know the piracy rate is 66 percent in Romania), XP is probably equal to Vista. But taking the real numbers, XP by far surpasses Vista. So, I am only speculating, but if Vista makes up around 20 percent, XP is probably somewhere around 75 percent. The remaining 5 percent is represented by other operating systems which are either very old Microsoft systems or ones not created by Microsoft. Anyway, even though we do not have clear statistics, we think our market share is definitely above 90 percent here.

On the site of the Ministry of Public Finance, Microsoft Romania’s turnover in 2008 was EUR 30 million. Can you confirm this figure?

We cannot disclose the local results but the real figure is actually much higher and includes the sums made by all Microsoft partners who make orders and pay directly in Ireland. Microsoft’s results at global level amounted to USD 12.9 billion in the first quarter. Many of the investments that are made are costs for the Microsoft Corporation but the money comes from abroad, not from the Romanian branch, which is why it is hard to give such a precise answer.

How was this year for Microsoft Romania, compared to 2008, and what financial estimations do you have for 2010?

We will probably not reach the level of 2008 any time soon. We already said at the end of the fiscal year (June 2009), we had had a 12 percent decrease in the 2009 turnover compared to the 2008 turnover. The evolution that Microsoft Romania will have in the next fiscal year (July 1, 2009-June 30, 2010) will probably not compensate for the 12 percent decrease. So 2010 will probably not return to the level of 2008. We would like to get there but I think we have a realistic budget and fiscal plan and at this point we are on target.