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Windows 7 Pricing, Discounts Unveiled

Microsoft on Thursday announced Windows 7 consumer pricing, an upgrade program for new PC buyers and a limited-time discount offer -- starting on June 26.

Windows 7, Microsoft newest operating system, is scheduled for general availability on Oct. 22, but Microsoft is laying out some incentives in the interim for consumers and small business customers.

On June 26, Microsoft will offer discounts of more than 50 percent for those willing to pre-order Windows 7 in certain markets. U.S. buyers can pre-order Windows 7 Home Premium upgrade for $49.99 or Windows 7 Professional upgrade for $99.99. This discount offer ends on July 11 in the United States and Canada. It ends on July 5 in Japan.

In the United Kingdom, France and Germany, the Windows 7 pre-order upgrade discount offer will begin on July 15 and end on Aug. 14.

The Windows 7 preorder upgrade discounts are available while supplies last through retail outlets. The price will vary per country, according to the Windows blog. Those interested in pre-ordering Windows 7 can do so here.

Additionally, Microsoft is offering an "upgrade option program" for buyers of new Vista-based PCs from participating original equipment manufacturers (OEMs) or retailers. The Windows 7 upgrade option program starts on June 26 and will last until Jan. 31, 2010. Under this program, which will be in effect worldwide, buyers of new Vista-based PCs can get a free upgrade to Windows 7.

This free upgrade applies to three Vista editions, including Home Premium, Business or Ultimate. Users will get a free upgrade only to the corresponding Windows 7 edition -- that is, Home Premium, Professional or Ultimate.

OEMs will ship PCs with Windows 7 in all languages on Oct. 22. The retail copies of Windows 7 will arrive a little later for some countries, but by Oct. 31, Windows 7 will be available in all languages, the Windows blog explained.

Because Microsoft cannot release the retail upgrade version of Windows 7E (for Europe) by the Oct. 22 general availability date, the company plans to offer the full-packaged version of Windows 7E on that date, but at the upgrade price, according to Brad Brooks, Microsoft's corporate vice president for Windows consumer marketing, in a Microsoft interview.

The Windows 7E version is expected to omit Internet Explorer (IE) 8. Microsoft is currently involved with a dispute with the European Commission, which sees the bundling of IE with Windows as anti-competitive behavior in Europe.

Finally, Microsoft provided pricing for Windows 7 when it becomes available on Oct. 22. Consumers who skipped Vista will find a hefty price tag awaiting them. The retail cost for the full Windows 7 Home Premium package costs nearly $200. Prices for Vista upgrades are lower. Microsoft officials said that the Home Premium upgrade price of Windows 7 is 10 percent lower than its Vista counterpart.

Estimated U.S. retail pricing for Windows 7 is described below.

Upgrade Windows 7:

  • Home Premium: $119.99
  • Windows 7 Professional: $199.99
  • Windows 7 Ultimate: $219.99

Full-packaged Windows 7:

  • Windows 7 Home Premium: $199.99
  • Windows 7 Professional: $299.99
  • Windows 7 Ultimate: $319.99

Microsoft didn't disclose whether the pricing for Windows 7 would be different for low-cost netbook computers running the new OS. Currently, Microsoft just licenses its venerable Windows XP Home edition to OEMs for netbooks.

From an accounting perspective, Microsoft plans to treat income from its upgrade option program as the sales of two OS products, splitting revenue from Vista and Windows 7 on a 50-50 basis. So, about 50 percent of its Windows revenue will be deferred for accounting purposes, according to Frank Brod, Microsoft's corporate vice president of finance and administration and chief accounting officer. To provide perspective, Brod explained in a conference call that the previous upgrade option program for Vista had deferred about $1 billion dollars in revenue.

As a reminder, the Windows 7 beta expires on July 1, but people can still upgrade to the Windows 7 release candidate (RC), according to this blog. A TechNet blog post says the RC can be downloaded until Aug. 9.

About the Author

Kurt Mackie is senior news producer for the 1105 Enterprise Computing Group.

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