“Vista Fixed Edition” 50 percent off the first day

Microsoft released pricing yesterday for “Vista Fixed Edition,” otherwise known as Windows 7.

For those of you who fainted at the sight of the prices, I’ll review them one more time:

Home Premium: $119.99 upgrade; $199.99 full version
Professional: $199.99 upgrade; $299.99 full version
Ultimate: $219.99 upgrade; $319.99 full version

I opined yesterday that Apple must have a mole inside Microsoft’s pricing department because I can’t think of any other reason that they would price the operating system so high. Especially when Apple priced Snow Leopard at $29.

However, I may have been wrong.

The Apple mole must be in the marketing department. After announcing the prices and getting heat from almost everyone, Microsoft launched its marketing campaign giving users the opportunity to get a 50 percent off coupon.

Both Ars Technica and Engadget ran the promo yesterday. Here are the eligibility requirements on Ars:

To Be Eligible: You must be over 18 and live in the United States (sorry, you can blame Microsoft and our lawyers for the geographic nuances). Please only comment on this post if you are eligible, it will save us many headaches later. Read on for more details on how to enter this sweepstakes and what you could win.

How to Enter: Leave a comment on this post and we’ll choose 100 random winners. Valid entries must be made within a 24-hour period between 1:30pm Central Time on June 25 and 1:30pm Central Time on June 26. We’ll start contacting winners by e-mail between 1:30pm CT and 5pm CT tomorrow to verify they are eligible. Winners must reply before 10pm CT, otherwise they will lose their coupon code. Make sure you have your e-mail address setup correctly on http://civis.arstechnica.com/users/login/ so that we can contact you if you win.

Now that is good marketing. This is what it says to me.

We know you’re upset about the pricing, and we know you’re not sure about upgrading because Vista was a diaster, but we’ve got a great deal for you. 50 percent off, because we overpriced it in the first place.

Seriously, I don’t understand this. Why not start your marketing campaign with how good the new operating system is, the changes that have been made, who’s upgrading and why–stuff like that. Substantial things that people can sink their teeth into as reasons to want Windows 7.

You shouldn’t treat the release like it’s a flea market negotiation. But then again what do I know, I’m paying $29 (non-discounted price) for the most advanced operating system around with Mac OS X Snow Leopard.

If I were a Windows users, I’d wait until October and take advantage of the 99 percent discount.

Paul Johnson

They priced it so high because Microsoft really wants people to buy new computers with Windows 7 installed. The possibility of PC manufacturers dropping out of the mass licensing program is the only risk to their business.
Jim Dalrymple

I wonder if that would happen if Windows 7 bombs like Vista?
John Storm

The publicly available release candidate of Windows 7 is pretty solid. It eliminates some of the most frustrating user-experience issues that exist in Vista, and runs faster/leaner on the same hardware. Overall, it is a step in the right direction for Microsoft. However, I still strongly prefer Mac OS X.

What really rubs me the wrong way is the notion that the pre-order discount is only available until July 11th, or “while supplies last”. Guess what, M$, the product doesn’t exist yet, so there’s nothing that can possibly become sold-out! They may indeed have a specific number of upgrades in mind that they are willing to sell at the discounted price, but from a sales/marketing perspective, it’s a completely bogus call to action. I don’t know if many people have picked up on that – What a lame and transparent scare tactic to get people to place their pre-order ASAP.

Finally, I don’t think it’s a moral imperative that Microsoft needs to charge as little for the upgrades to Windows 7 as Apple will for Snow Leopard. If they can’t or won’t compete with Apple’s $29 upgrade price, that is their prerogative. Some people have speculated that MS cannot afford to sell them that inexpensively, and that may very well be true. But despite having a nice product on the brink of release, MS chooses to continue playing games with their customers.
http://www.whitedog.biz B. Jefferson Le Blanc

I doubt anyone seriously expects it to bomb – most of the early reviews have been positive. Like Snow Leopard, Windows 7 is dropping a lot of legacy code to run leaner. On the other hand, it still lacks substantial incentive to upgrade from XP – at least until the lack of XP support from Microsoft begins to bite. Regardless of how good 7 is, though, the upgrade cost will deter a lot of people – for a while at least. But, just as with Vista, new computer purchases can be expected to insinuate 7 into the marketplace eventually, unless MS gets major blowback from their OEMs. What will be interesting is to see if the cost of 7 to Microsoft’s partners is higher than normal, reflecting the retail cost; if so, all those low cost computer makers will be pinched where it hurts.

The half-price upgrade pre-order sale is bound to appeal to techies; I suppose MS hopes these early adopters will seed their user base and create some upbeat buzz. Still, I suspect Vista has created some serious inertia and considerable resistance to Microsoft’s marketing claims. Most people don’t read the tech media and are unlikely to be aware of, let alone impressed by, 7′s new features. BitLocker? Domain Join? XP Mode 2? Fast language switching? Yawn.

And, of course, a lot depends on how Snow Leopard is received. Microsoft won’t match the price (they have never been deterred by Apple’s OS pricing). But a lot of positive press for Snow Leopard will hurt Microsoft’s pride, if nothing else. It could, at long last, hurt their market share as well. Now that would be news.
http://varunkrish.com Varun

nice post .. with such high prices for an OS piracy will increase .

Win7 seems a lot stable IMHO . Has M$ got it right atlast ?