November retail sales of Windows XP weren't so hot. But is the operating system a flop? Maybe not, analysts say. Microsoft's biggest operating system launch ever has failed to generate enough retail sales to push past its predecessor, Windows 98, according to market researcher NPD Intelect. Retailers sold 250,000 copies of Windows XP in November, its first full month of availability, down from 400,000 in October. The October sales account for six days on store shelves plus preorders. By contrast, consumers snapped up 580,000 copies of Windows 98 during its first month on store shelves and 350,000 during the following 30 days. But retail sales are not the key measure of an operating system's success, analysts say. Copies sold at retail are "boxed" upgrades or full versions for consumers looking to move to the newest version of Windows. The more accurate measure is client licenses sold to PC makers or businesses. By that accounting, analysts say, Windows XP already is primed to have the most successful first year on the market of any Microsoft operating system.

"Retail sales are like gravy for Microsoft," said Howard Dyckovsky, an NPD Intelect analyst. "It helps them get their name out there and keeps them in front of the consumers. But the overwhelming majority is going to be on new computers or client licenses." Dyckovsky attributed XP's slow retail start to a number of factors including the weak economy, the saturated PC market, and presales of Windows XP PCs. While consumers had to wait until Oct. 25 to get a boxed copy of Windows XP, PC makers shipped the operating system on new computers a full month earlier. Additionally, more consumers upgrade their operating systems by buying entirely new computers, rather than buying new versions of Windows to put on older PCs, according to Dyckovsky and several others. Sales were "probably not what Microsoft expected last spring," Dyckovsky said. "But it's probably very close to what they expected after Sept. 11."