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Summary:

Although Windows Upgrade Program details are trickling out from OEMs, the more important news may be the actual pricing for Windows 7. Microsoft announced the prices this morning for both full licenses and upgrade packages: Windows 7 Home Premium: $119.99 upgrade, $199.99 full Windows 7 Professional: […]

windows-7-logoAlthough Windows Upgrade Program details are trickling out from OEMs, the more important news may be the actual pricing for Windows 7. Microsoft announced the prices this morning for both full licenses and upgrade packages:

  • Windows 7 Home Premium: $119.99 upgrade, $199.99 full
  • Windows 7 Professional: $199.99 upgrade, $299.99 full
  • Windows 7 Ultimate: $219.99 upgrade, $319.99 full

In my opinion, the pricing is high, but expected. There’s a perception out there that Windows 7 is really a fix for Vista. A service pack, if you will. From that standpoint, these prices seem high. To help offset that, you can take advantage of a special price discount by pre-ordering Windows 7.

Starting tomorrow in the U.S., Canada and Japan, you can pre-order the Home Premium version for $49.99 or the Professional version for $99.99. Residents of the UK, France and Germany will be offered a discount starting on July 15. These deals are for a limited time only at this point.

I can’t help but wonder if Microsoft is shooting itself in the foot with this pricing to a point. Granted, most consumers don’t know the cost of a Windows license since it’s typically hidden in the cost of a device. Hardware makers don’t pay nearly as much as the full consumer OS pricing either, so they usually pass on costs that are less than retail. But there’s a perception issue that Microsoft has to manage with this pricing. Consumers are starting to get savvy about free and low-cost Linux distros. Apple is marketing its Snow Leopard version of OS X, also in October ironically, as a $29 cost. People won’t talk about the low-priced OEM licenses for Windows 7. They’ll be talking about the visible retail prices, and that could drive them away in bits and pieces.

While I think Windows 7 is a solid improvement over Vista, I have a hard time justifying the retail pricing. Do you?

  1. No problem with pricing when it is good product. I will purchase 3 upgrades.

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    1. Curious if your three upgrades are for one household. Some folks want to see a “family pack” for Windows 7, much as Apple is offering for $49 with Snow Leopard.

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  2. Yes. I have 2 desktops and a laptop. You bet that I would like a “family pack”. My laptop actually runs XP and would not run Vista. The Upgrade Advsiso indicates that it will run 7.

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  3. Retail pricing is really rip-off if you already bought Vista. Windows 7 is what Vista should have been. Vista just had so many problems that Windows 7 is nothing but service pack for Vista and for Vista customers this should be nominal upgrade like $29.

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    1. I disagree. I’ve never had a single problem with Vista and have been using it since RTM in 2006. It’s definitely been worth it for me. Anyone who has been struggling with Vista since SP1 has nobody but themselves to blame IMO.

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    2. I agree. Vista was so bad and has done so much damage to MS that as a kind gesture they should offer a steep discount to all those who suffered through that nightmare on redmond street.

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  4. I think I’ll wait for a notebook upgrade a few more months before jumping on Win 7 – no way I’m paying $320+tax for ultimate.

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  5. I could not disagree more with your comparison between OSX and W7. The entry Mac laptop costs $999 whereas the entry Windows laptop at $500, at $350 for netbooks. Whether $550 or $400, Windows options start cheaper than Mac.

    That being said, Microsoft still should do more for those of us who purchased Vista.

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  6. John in Norway Thursday, June 25, 2009

    According to the BBC article I read it says:

    ‘Stand alone versions of Windows 7, that can run on more than one PC, will also be available.’

    I’m not sure how to interpret that. Does it mean the OS isn’t closed like Apple’s or that the licence covers more than one machine?

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  7. The only people I know who are calling Windows 7 a service pack don’t know what they’re talking about so it’s a shame to hear you say that too Kevin. It’s also extremely small-minded to focus on the retail pricing which, lets be honest, will only effect the miniscule number of users who pay for retail disks and won’t take advantage of the great pre-release offer announced today. Most people who go out and buy Windows buy OEM disks which cost considerably less and 99% of users get Windows on a new PC, as you well know.

    The comparison with Snow Leopard is pretty poor considering that it’s widely regarded as a catch-up service pack. Christ, the name even suggests that it’s just a small update to Leopard.

    Every site I’ve seen reporting this has been really positive (including Engadget and Gizmodo who are well known for criticising everything that Microsoft do) so it’s a shame to see an unnecessarily negative spin being put on it here.

    Windows 7 will undeniably be the best OS on the market come October and the pricing for it seems about right to me – especially when you consider that the full retail price of Home Premium is cheaper than it was for Vista.

    If you check you’ll find that it’s no longer cool to mindlessly bash Windows.

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    1. Jake, if you’ll check you’ll find it’s no longer cool mindlessly put words in people’s mouths. ;) I think you’re reading the posts too fast and then reacting.

      “The only people I know who are calling Windows 7 a service pack don’t know what they’re talking about so it’s a shame to hear you say that too Kevin” – I didn’t say that. I said, “There’s a perception out there that Windows 7 is really a fix for Vista. A service pack, if you will.” Not the same at all.

      “It’s also extremely small-minded to focus on the retail pricing which, lets be honest, will only effect the miniscule number of users who pay for retail disks and won’t take advantage of the great pre-release offer announced today. Most people who go out and buy Windows buy OEM disks which cost considerably less and 99% of users get Windows on a new PC, as you well know.” I agree. In fact I did: “Granted, most consumers don’t know the cost of a Windows license since it’s typically hidden in the cost of a device. Hardware makers don’t pay nearly as much as the full consumer OS pricing either, so they usually pass on costs that are less than retail.”

      Jake, I appreciate your many insightful comments here and I don’t want that to stop. But slow down, would ya? :) I don’t appreciate being called “small minded” unless I truly deserve it. I’m thinking not in this case, but of course, that’s just my opinion. Ping me direct via email if you disagree.

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    2. Sorry Kevin, I didn’t intend for that to come across as a personal attack so please don’t take it that way. I don’t hate you and I certainly don’t think you are small-minded :) That reference was directed at the point you were making, not you personally.

      Perhaps I did read too much into your comments but saying that “There’s a perception out there that Windows 7 is really a fix for Vista. A service pack, if you will.” certainly seems like that’s what you’re suggesting – why say it if you didn’t mean to draw attention to the idea?

      I do think that your post was unnecessarily negative and I do think it’s a shame that you’ve decided to take this position. You’re generally very fair and even handed which is what makes your opinion valuable, but not this time.

      Anyway, let’s agree to disagree and forgive me if I’ve offended you.

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    3. No worries and we can agree to disagree, of course. :) Perhaps I did a poor job of writing my ultimate point here: consumer perceptions of price and value are very important, more so in a down economy. As we both said, most folks pay the far lower, included cost of a license when buying a new system. But that doesn’t stem the consumer perception that Windows is a relatively expensive OS.

      As I’ve said many times before and will continue to say again: Windows 7 is a great OS. Arguably better than XP and Vista. I don’t think I’ve ever “bashed” the OS. I simply feel for folks that bought XP machines, skipped Vista and will now have to pay $120 or more to upgrade. Then again, it’s their wallet, so they’ll vote with it, just as you and I will. :)

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  8. Important to emphasize it’s just perceptions.
    Retail pricing is not important to us, although yes it may influence perceptions for better or worse. OEM pricing (not just pricing to OEMs but prices for OEM disks) is.
    Apple’s pricing is not a comparison because you can only install on Apple hardware and that’s where they have their profit margin.

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  9. I think Win7 will be the best OS that MS has ever released but its retail price is too high, especially for a netbook user who wants the Pro edition. I don’t expect it to fly off of shelves at Best Buy, but as always they will receive most sales from the pre-install deals they make with vendors and not from trying to sell directly to the public.

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  10. Wait, I think I know why the price is so jacked up. They must be included the upcoming fines (supposedly in the billions of dollars) from the EU that they will soon be hit with. See, they are going to recoup their loses one way or another. It is purely a business decision.

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