The Decline of the Zip Business

In scanning the prospectus for Corel Corporation’s planned IPO, I was interested to see the revenue numbers for compression company WinZip. Vector Capital has combined WinZip with Corel in setting up the share sale, and yearly WinZip revenues are in the filing:

  • 2003: $25.3 million
  • 2004: $24.9 million
  • 2005: $22.7 million

Interesting that the compression business has not only stalled, but is in steady decline.


  1. why care about winzip when there are plenty of alternatives (winrar), include the open source 7-zip.

  2. WinXP has support for unzipping a .zip archive right in the shell. That removes the #1 reason to buy WinZip. And if you’re serious about compression, free archive utilities like IZArc have also surpassed WinZip in functionality.

  3. In addition to the other pressures mentioned above, compression algorithms are relatively straightforward to write and are well-studied in CS at the undergrad level. Talk about constant pressure to innovate; they work for pizza and grades.

  4. Who needs compression when storage is cheap and network pipes are getting faster?

  5. who needs compression? As network pipes get faster they’ll just make the content fatter. It’s a race you can’t win.

  6. Looks like their revenue stream passes through each improved release of their software.

  7. Not familiar with what Nelson is talking about, but Windows 2003 has integrated support for zip and other archive types in the UI, and so will Vista. Their sales should fall off a cliff in a few years (granted it’s a small cliff)
    Will we see an anti-trust suit from Corel over this (at least in the EU)?

  8. Another factor: for years WinZip offered free upgrades. With version 10, they are charging to upgrade. Problem is there is no reason to upgrade; version 9 works just fine.
    So, those who really need WinZip have bought it. And find little reason to upgrade.
    I suspect their major source of revenues now are site sales to companies.

  9. bob rawding says:

    I wouldn’t trust _ANYTHING_ that Micro$haft does. They will probably start charging extra for their “zip” shell feature. WinZip is still cheap and fast with MORE options than either WinRar or WinXP shell. WinZip11 (now in beta) does a lot more than either of the others mentioned. I’ve rarely found anything dysfunctioal with WinZip. You can’t say that about the others.

  10. Don’t worry people, I have purchased the distribution rights to winzip, and plan to release it for free again. We are also in the process of suing Microsoft to have it removed from windows. Please contact me for more info, or see the release on my site…