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I think it's brilliant. Campy and controversial to the point that the blogosphere can't shut up about it. The point of an ad is to create buzz, and they've succeeded.
Yes, it certainly is creating buzz. It's also draining life from the brand, which was already a bit moribund. Are they just going to give up and try to deliberately create badly-done campy ads a la Tunesmith from here on out? They do seem to have "found their voice", I guess.
I'll admit it - I had to look up moribund. And I think draining life from the brand is a little over the top. They know they're not cool anymore. So, they're throwing everything they can at the wall to see what sticks.
If Bill Gates murdered a man with his bare-hands for choosing MacOS over Windows that would get press or 'buzz' too, but I doubt it would be good. The whole idea of 'any publicity is good publicity' is predicated around 'getting your name out there.' The problem here is that Microsoft already has it's name out there. It's a well-established brand. At this point they have more to lose. Bad publicity can tarnish a brand.
In the novel Syrup, by Maxx Barry, the protagonist, who works in marketing, says that successful advertisements create both identification and appeal, and that identification alone is not enough to sell. Paraphrasing him, he says, "Coca Cola could get a lot of attention and reach a lot of people by saying, 'Our product is terrible. Only an idiot would drink it.' But nobody would want something that terrible. An ad doesn't just need to get attention—it needs to sell. Otherwise it's a disaster."

When I see this ad, I don't see a company that's made a legitimate product, or that has any sense of professionalism.

Well, if you take this as direct marketing, no. But this is a 6-7 minute video, not really an ad. OK, so call the launch party a cheesy idea (although I'm kinda kicking myself for not pretending to host one and getting a free copy :) ), but if people are going to hold one this is a non-bossy way to give some hints on how.

They could have sent out a pdf with a bunch of how to tips but that would have been too corporate. Or they could have just done a page with a bunch of tips, but that might not be very engaging for people who wanted to try the idea. This strikes an OK balance. It reminds me of something like a tupperware party (MLM for plastic kitchen appliances)...maybe a bizarre way to market the product, but also a very low-risk one that follows the most basic and down-to-earth marketing principles - friend's recommendations are the most trustworthy, eye candy only impresses those who have already converted, etc.

Same way the cute little girl commercial is aggravating if you wanted muscular tech information, but makes it really easy to envision a family computer than runs Windows. The underlying idea here is that MS wants to be part of people's lives, rather than inviting people to build their lives around their product. It's a subtle difference, but a powerful one.

Open bet: MSFT is just under $26 today. I say it'll be $35 by Dec 31.

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I don't think it's intended to be campy or controversial. I just think they're using multi-level marketing/infomercial techniques, which very likely work for average people (otherwise they wouldn't be so frequently used).
If you don't understand that it's an epic troll, right down to the race/gender roles, you probably need a business co-founder/are a redneck/think FoxTrot is the best thing evar/etc. etc.

EDIT: It would only have been more epic if they followed BADF.

> If you don't understand that it's an epic troll, right down to the race/gender roles

I thought that the 'token black guy' was always supposed to die before the end of the movie...

The whole concept is awful, but somewhere, someone will host a party in exactly this vein, and that scares me.
Microsoft has no sense of identity as a company when it comes to marketing. Every campaign is some new weird angle or a copy of another companies tactics. If they are trying to make it lame & campy on purpose its a questionable move. How often does that work? Simple social factors preclude most people from strongly identifying with something that is marketed as being lame. The only time it works is if the product/service your selling actually is lame and/or boring and it's impossible to change that perception. For example, insurance. It's puzzling because Windows 7 is one of the few Microsoft products that actually is somewhat fresh and not just a minor version bump.
"puzzling because Windows 7 is one of the few Microsoft products that actually is somewhat fresh and not just a minor version bump"

Interesting... granted I don't particularly follow Windows development, but my perception was that it is exactly that - a minor version bump over Vista fixing the problems that shouldn't have been there in the first place...

That is true. I'm thinking more along the lines of all the XP users out there that decided to skip Vista. For them it's a big upgrade.
This is a perfect ad for Windows users. If you took away the Sony laptop and had them talking about something else, and then had me guess the type of OS they used ...

they've all got windows written all over them.

Oh a and did I mention, my non-tech savvy parents would probably like this advert ?

As a Microsoftie, I am genuinely embarrassed.
Am I the only one that's wondering why the camera zooms in and moves around so much? I guess they were trying to "spice it up" and make it not seem as boring. It just made me sick.
I couldn't stop looking at the clock on the stove in the background jump around to different times
Are these going to be playing in the middle of the night, alongside the green handkerchiefs of prosperity commercials?
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"you may want to try the bonus activities but you'll need the right devices"

Kinky!

Holy shit what are they even talking about This is so embarrassing. I just want to go hide under a blanket.
It's pretty clear to me what the thought processes are behind this. Microsoft have seen all the release parties that Free Software projects like Debian and Ubuntu, FreeBSD et al have, and somewhere there's been a meeting that posed the question 'How can we have the same for Windows 7?'.

Videos like this are the answer they came up with. Unsurprisingly it looks plasticy and fake, because they're trying to fake something that has grown spontaneously elsewhere.

This is real. I was just invited to a Windows 7 Launch Party by the student Microsoft rep on campus. The officially-worded invite mentions a PhotoPalooza, a photo tour of Windows 7 on her machine.