July 31, 1995

State agriculture officials say the gypsy moth is once again attacking forests in southern New Jersey. About 39,000 acres of woods have been defoliated, mainly in Cape May, Cumberland, Salem and Atlantic Counties, the A.P. reported.

The climb back was a long, tough one and surely at times seemed impossible to traverse. But the Yankees tonight finally did what they could not for over two months: break above .500, thanks to the generous Minnesota Twins. The Yankees defeated the once-mighty Twins, 7-4, tonight. They did so thanks to the fielding of the Twins, who this weekend treated the Metrodome like a chamber of horrors and any ball hit by the uncanny Mike Stanley as untouchable.

Yesterday belonged to Mets' ace of the future, not to the current one who might be a former Met by midnight tonight. With the clock on the non-waiver trade deadline ticking and the rumors growing stronger out of Boston about the possible departure of Bret Saberhagen, Jason Isringhausen, age 22, went out and won his first major league game in the Mets' 2-1 victory over the Pittsburgh Pirates.

Secretary of State Warren Christopher, significantly raising the pressure on China, said today that "it would be very difficult" for President Clinton to hold a summit meeting in October with China's President, Jiang Zemin, unless the Chinese Government first releases Harry Wu, an American citizen charged with stealing state secrets. Mr. Christopher made his remarks to reporters as he flew to Brunei for a meeting of Asian foreign ministers and the first meeting with his Chinese counterpart since relations between the Washington and Beijing began to deteriorate.

REDMOND, Wash. The Microspft Corporation plans to begin selling its 272d software title on Aug. 24. But it is clear that Windows, 95, the latest version of the software that runs some 100 million of the world's personal computers, is much more than just another new product. Windows 95 is a sign of the times, already creating a stir in markets worldwide, in Washington and on Wall Street, an indication of the inroads the personal comptuer has made into contemporary commerce and culture. A video producer is churning out five million copies of a Windows 95 tape, convinced that sales of an instructional video on a software program will dwarf those of past best sellers, like the Cindy Crawford workout tapes. The test versions of the software that Microsoft has been circulating for months have received microscopic scrutiny, not only for technical flaws but even for political slights. One version had a map with a misdrawn Latin American border, bringing fiery protest from Peru, which is in a border dispute with Ecuador. Meanwhile, the Justice Department is racing to decide whether to stop Microsoft from using Windows 95 as a springboard for the company's new on-line service. And the surge in stock prices this year has been led by technology companies, partly in anticipation of increased sales of computer hardware and software that analysts expect in the wake of the Windows 95 introduction on Aug. 24. Should sales of the new Microsoft program lag behind expectations, the stock market may well tumble. The fascination, hype and controversy surrounding Windows 95 stems largely from the fact that PC's are now ubiquitous in the workplace and are fast becoming a mainstream consumer product. The $85- billion-a-year personal computer industry is recognized as a pillar of the American economy. And as a gateway to the Internet, cyberspace and multimedia, the personal computer affects everything from how people communicate with each other to how children are educated. Even Brad Chase, the 34-year-old architect of Microsoft's marketing strategy for Windows 95, says he is amazed by all the attention the product has received. And he readily admits that the phenomenon is only partly explained by the big-budget marketing campaign he has led for the last year from Microsoft's pine-covered corporate campus here, outside Seattle. "The breadth of interest in Windows 95 is because of all these things, from the Internet to the Justice Department investigation, coming together, all these stars getting into line at once," Mr. Chase said. "Windows 95 is a lot more than software." And how is a single software program linked to all these larger trends and events? Simply put, because Windows 95 is a new operating system and because it is Microsoft's. An operating system controls the on-screen look of a personal computer and the keyboard-and-mouse steps required to use it, and more than 80 percent of all PC's use Microsoft's operating software. So when Microsoft overhauls its operating program, it is changing the language of personal computing. Windows 95, by all accounts, is the most significant change Microsoft has made in its operating program since 1990. That was the year the company introduced its first Windows system, which borrowed an approach from Apple Computer's Macintosh by enabling a user to point and click on graphical icons instead of typing arcane commands. Since then, Microsoft has improved Windows, notably with its Windows 3.1 version in 1992. But Windows 95 is an entirely new operating system built with 11 million lines of programming code, compared with 3 million lines for Windows 3.1. All operating systems have their irritating quirks and shortcomings, and Windows 95, priced at less than $100, is no exception. Some existing programs do not yet run smoothly on Windows 95, and it requires more computer hard-disk space and memory to use than the previous generation of Windows. But analysts agree that Windows 95 represents a big step forward in making computers less confusing for someone writing a report, browsing the Internet or installing a new printer. Technology purists point out that some of the new features of Microsoft's new system, like being able to have lengthy file names instead of the eight-character limit of Windows 3.1, are advantages that rival operating systems -- the Apple Macintosh and I.B.M.'s OS/2 -- have had for years. Yet even with a technical edge, Microsoft's competitors have not been able to challenge the company's dominance of the operating system market, which it attained shortly after I.B.M. chose Microsoft's Disk Operating System for the I.B.M. PC in 1980. By now, in the PC operating system market, Microsoft has no genuine rival. The company's extraordinary marketing campaign, with an estimated budget of $150 million, is intended less to fend off competition than to move computer companies and users -- quickly -- to the new industry standard, Windows 95. "For Microsoft, the marketing campaign is essentially a $150 million insurance policy to make sure that nothing happens to prevent Windows 95 from becoming by far the most successful product in the history of the business," said David B. Yoffie, a professor at the Harvard Business School. If Microsoft makes Windows 95 a success, it will have plenty of help from the rest of the personal computer industry. Dataquest, a market research firm, estimates that in addition to Microsoft's $150 million, other hardware and software companies, retailers and distributors will spend $350 million this year to market Windows 95 and their own Windows 95-related products. Other software makers, in particular, tend to have a hate-you/need-you relationship with Microsoft. As the dominant producer, Microsoft makes not only operating software but also applications like word processing programs, data bases, spreadsheets, educational software and games. So it is the chief rival of most applications-software companies in the industry. But because the software makers' products run on the Microsoft operating system, they have been rushing to develop products for the new Windows 95 platform. A successful rollout of Windows 95 in the early months is vital to Microsoft, both to its corporate pride and its profits. Analysts' sales estimates vary considerably for the last four months of 1995, following the Aug. 24 debut. At the high end, Dataquest is forecasting sales of 29 million copies this year. International Data Corporation, another research firm, predicts 20 million. Another firm, Inteco, estimates it will be only 14 million. At roughly $50 in revenue to Microsoft for each copy sold, the difference between a torrid and a not-so-fast rollout could make a striking difference in near-term revenues and profits. Selling 29 million copies this year means roughly $1.45 billion in revenue to Microsoft, while 14 million copies would be $700 million. Responsibility for seeing that the Windows 95 marketing goes quickly and smoothly rests largely on the shoulders of Mr. Chase, the general manager of Microsoft's personal systems division, and seven group product managers. They are all men in their early 30's -- seasoned veterans by Microsoft standards. They are mainly M.B.A.'s from places like Wharton, Harvard and Northwestern. Most started in other fields, then recognized that technology was the future, and headed to Redmond. Mr. Chase wrote the marketing blueprint one night, shortly before a March 1994 meeting with Bill Gates, the Microsoft chairman. It sketched out what Mr. Chase called the "E-strategy" for Educate, Excite and Engage, and it explained that the personal computer market has broadened so much since the introduction of Windows 3.1 in 1992, nearly tenfold, that an entirely different approach was needed this time. And different it has been. The company has distributed 400,000 beta, or test, copies of Windows 95, many of them to corporate users licensed to put the software on more than one PC. By Aug. 24, an estimated million people will have used Windows 95 for nearly 75 million hours. This means that even before it officially hits the market, Windows 95 will have received more use than all but a few of the most successful software products receive in their entire several-year product cycles. For more than a year, Microsoft has been bringing software developers, PC makers, corporate customers and members of the computer press to Redmond for briefing and cajoling. The company presented demonstrations to 50,000 individual customers during a 23-city, three-month tour of the United States.. Microsoft sent the finished code for Windows 95 to factories on July 14. And the company has revved up seven times its normal production capacity, contracting with 12 plants and engaging a fleet of 500 trucks, to insure that the new product will be at 20,000 retail outlets, from CompUSA to Wal-Mart, on Aug. 24. Consumers are expected to move quickly to Windows 95, particularly since it will be preloaded on the machines produced for the Christmas season by manufacturers like Compaq, Packard Bell, Gateway and Dell. But corporate customers traditionally wait six to nine months to buy new operating systems, allowing the early programming bugs to be eliminated. To try to get companies to move quickly this time, Microsoft and distributors have offered large customers hundreds of free copies as an incentive to buy others. Companies that have agreed to deploy Windows 95 on many desktops by Aug. 24 include Ford, Dow Chemical, Sprint and Deloitte Touche. Yet it seems doubtful how quickly even the Microsoft marketing arsenal can prompt companies to move to Windows 95. Surveys show most companies would wait until next year to make the transition. "There's no question about it," Mr. Chase said, "inertia is our biggest competitor."