Windows Business Is Worth $110 Billion

It certainly makes sense for the biggest software company in the world to own the most valuable software business globally.

And according to financial analysis outfit Trefis this is precisely the case. Microsoft’s Windows business is valued at a staggering $110 billion, having jumped no less than $9 billion just in the past year alone.

In fact, the Redmond company has both of its cash cows on Trefis’s top 6 largest software businesses worldwide.

The Office business, valued at some $86 billion occupies the third position, ahead of Oracle Database Software ($69 billion), Oracle Middleware Software ($44 billion) and EMC Storage Software ($23 billion).

Sandwiched between Windows and Office is IBM Middleware, worth $107 billion, and 2009’s top dog, a position it failed to keep despite growing an estimated $4 billion in the past year.

“Windows Operating System is the largest segment for Microsoft, making up about 41% of Microsoft’s stock, followed by Microsoft Office which contributes 32% to the company value,” Trefis stated.

Responsible for the $9 billion growth of the Windows business is of course, Windows 7.

The last version of the Windows client shipped to consumers in late October 2009 but went on to deliver its largest impact over the past year, when sales jumped to over 240 million units, with expectations that they will hit 300 million licenses by year’s end.

Trefis notes that both the commercial success of Windows 7 and the increase in PC shipments in 2010 are responsible for fueling the growth of the Windows business.

“Increase in PC shipments: Worldwide PC shipments will reach 352.4 million units in 2010, a 14% increase from 2009, according to the latest preliminary forecast by Gartner, Inc. As a result, sales of Windows OS improved significantly over the past year. Windows OS also dominated the netbooks market (at 68%), which was the main growth driver for PC sales,” the company said.

“Windows 7 gained share: Windows 7 launched during late 2009 and received a positive response vs. Microsoft’s prior Windows Vista product. Windows 7’s share of operating systems increased from 7.5% at the beginning of 2010 to nearly 20% in November 2010 (based on web usage statistics).

“While most of this growth came at the expense of other Windows Operating Systems like XP and Vista, it helped Windows to slightly gain market share when adjusted for piracy,” Trefis added.