THE CUTTING EDGE: SPECIAL REPORT / HOT TIPS : What’s Coming, When, and Why It’s a Big Deal : Impending Windows95 May Be Year’s Main Event

SAN FRANCISCO —  It may be late for an important date, but Microsoft’s eagerly awaited Windows95 will nonetheless be the computer industry’s main event next year, say the pundits who track the nation’s silicon glens and valleys.

And assuming that Intel can quickly squash its floating-point bug and quash the attendant controversy, 1995 will also be the year of the Pentium microprocessor and its ilk.

There will be plenty of other developments in the coming year: Will the Justice Department buck industry consensus and scuttle the merger of Microsoft and Intuit, the champion of personal finance software? If not, will the joined companies grab control of the emerging market for on-line transactions, as many bankers fear?

Will the Microsoft Network on-line service, due along with Windows95, spell doom for rivals such as America Online and Prodigy, and bolster what some increasingly view as Microsoft Chairman Bill Gates’ stranglehold on the computer industry? Will the PowerPC coalition make headway against the Microsoft-Intel juggernaut?

Running through these issues like an out-of-control computer virus is Microsoft.

“Yes, Bill Gates will be all over everything,” said William Bluestein, an analyst at Forrester Research in Cambridge, Mass.

Mostly, Gates wants his easy-to-use Windows95 operating system to be all over the desktop PCs of home and business users. It promises a user “interface” with pictures of rooms and objects rather than the usual icons and menu bars, and it will come with easy on-line access in the form of Microsoft Network. Microsoft says Windows95 will be shipped to stores by June, but don’t be surprised if it’s late again.

Propelled by Windows95, the Pentium and Pentium-style “clones” from Advanced Micro Devices and Cyrix, sales of PCs are expected to show a healthy increase next year as prices for big multimedia systems tumble to $1,200 from $1,800 this year.

Projections from Dataquest, a San Jose market research firm, indicate that 1994 will go down as the year the $35-billion PC industry reached a stunning 21.2% growth rate. The pace of expansion in 1995, when sales of 20.5 million PCs are predicted, will be a still respectable 14.5%, Dataquest said.

“Barring something outside the normal electronic sphere, it sure looks to me like it will be another strong year for everybody,” said Les Crudele, a vice president with Motorola’s microprocessor and memory technologies group in Austin, Tex.

Richard Shaffer, principal of Technologic Partners, a New York-based consulting firm, said he expects to see reasonably strong industry expansion next year. “A lot depends on the strength of the economy, which looks pretty good,” he said.

In 1994, the hot commodity was multimedia, as consumers barreled headlong into computing to take advantage of the entertainment and educational opportunities afforded by souped-up machines with sound and video. Next year, the home market will continue to be a force, and growth will also come from the transition of office systems to the Pentium chip--though what effect the recent brouhaha over a bug will have on Pentium sales remains something of a wild card.

It will also be a critical year for IBM, whose OS/2 Warp will either become a true Windows rival or head toward extinction. IBM will also bring out its first PCs based on the PowerPC architecture developed with Apple. A few clones of the Apple PowerMac may also emerge late in the year.

Meanwhile, global commerce should create boundless opportunities. Central and South America, China and Africa represent vast, untapped markets for computers and telecommunications gear.

“People are going to be selling this stuff in every nook and cranny of the world,” said Roger B. McNamee, general partner with Integral Capital Partners, a Menlo Park, Calif., group that invests in technology companies. “By the end of the year, things will be smoking.”

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PCs

What: Windows95

When: About midyear

Why it’s important: Latest Microsoft operating system will be prettier, easier to use and much more powerful than Windows. Will quickly become a PC standard.