Analyst: Windows 7 is Still Too Expensive

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8:41 AM - June 30, 2009 by Marcus Yam

NPD analyst says that cheaper than Windows Vista is not cheap enough.

The big news last week was Microsoft announcing the retail pricing of Windows 7. Check out our previous coverage for the pricing details as well as the limited offer of upgrades at less than half price.

We asked you last week what you thought of Windows 7 pricing, and your responses were varied. Understandably, for those who build their own systems, the OEM pricing is most relevant. Others feel that it's too expensive – a sentiment shared by an analyst at the NPD Group.

NPD Group VP of industry analysis Stephen Baker wrote in the company blog last week with his thoughts on Microsoft’s pricing structure. He praised the (mostly) free upgrade program for PCs purchased on or after June 26, 2009, which solves many buying decisions for those who need new computers for back to school, as Windows 7 won’t be out until October 22, 2009.

Baker was less enthusiastic about the retail pricing of Windows 7, however, saying, "Besides the fact that $119 is a price point that fits nowhere in these economic times, it is still way too much for the software. … It is in Microsoft’s best interests to erase all vestiges of Vista from consumers' homes, and by making the upgrade expensive … Microsoft is creating a large disincentive for consumers to move to a far superior platform with a better user experience."

The NPD executive was also puzzled and displeased that Microsoft isn't offering a multiple user license package. He compared it to Apple’s upcoming Snow Leopard OS X software upgrade, which will sell in September for $29 for a single user license and $49 for a family pack that includes five licenses. Baker posed that in times when families have multiple computers in the home, a family pack similar to Apple’s offering is far more consumer-friendly.

What do you think? Even if Microsoft doesn’t change the eventual retail prices for Windows 7, would you be more inclined to upgrade your entire household if such a family pack were offered?

Source : Tom's Hardware US

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ryokinshin 06/30/2009 3:08 PM
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-20+

Windows 7 at $50 would make this full circle, the best thing Microsoft has ever done.

saifallofjmr 06/30/2009 3:08 PM
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vettedude 06/30/2009 3:09 PM
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LATTEH 06/30/2009 3:17 PM
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-17+

if it was at 50 for home it would make a lot of people happy

kojakk 06/30/2009 3:21 PM
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-5+

I'm disappointed that 7 Ultimate doesn't have a pre-order discount. I purchased Vista Ultimate less than 6 months ago, and while I'd really like to upgrade to 7 I don't want to have to do a full install if I downgrade to Professional, and I'm definitely not spending another $200 for 7 Ultimate.

VioMeTriX 06/30/2009 3:25 PM
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-1+

i have been on windows vista since alpha...they runied what couldve been a great os...the alpha was perfect...then microsoft added the bloat....as for vista being great, it is now even though still a resource hog....but people forget the many many months of constant bluescreens we endured at first, even on vista designed hardware.

so yes micrsoft should sell windows 7 at a fair price for the economy and as a way to say im sorry for messing with you all with something worse than windows me....as far as a family pack, never would happen in my home...i buy one copy and call it in if i need to...i have 5 computers in my home.... 3 of wich will run windows 7...the same copy... leave one as vista/ xp.... the other is my linux box....

but again after all the money people spent on vista...that should be considered into the price if they want everyone to upgrade.....

thejerk 06/30/2009 3:26 PM
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--3+

I would release two versions, like XP : Home and Professional.

I'd make Home $99 and Professional $199, and allow up to 4 activations, each. If you only have two computers at home, you already know at least two other people who want an upgrade. You could even charge those people the $20 or $40 and make your money back. Think about it, you could actually do something positive, and reduce piracy... even if just a little bit.

mikepaul 06/30/2009 3:27 PM
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-2+

Apple sells the hardware too, so a smaller profit on the software is OK. Comparing to Microsoft's position is less than useful.

I'm getting one discounted Professional upgrade, and then someday if XP stops running on my old Compaq I'll figure out if it's worth trying to upgrade...

thejerk 06/30/2009 3:27 PM
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--1+

I suppose I was using the new math. I meant the $25 or $50, respectively, above.

sublifer 06/30/2009 3:42 PM
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-7+

$50 for a retail box edition (not the upgrade edition) would be nice. If they really want to cut piracy and dominate the market, that's how you'd do it. They should create an add-on software store similar to the iTunes app-store and try to make back some money there... at least that way it would be optional. Most people wouldn't even mind paying $0.99 - 5.99 for a piece of cheap software, they could even sell calculator and MS paint this way instead of including all the little freebie apps.

jtt283 06/30/2009 3:42 PM
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-4+

I'd like to see the lower prices, sure. I think it is unlikely I'll upgrade my wife's PC or my laptop to Win7 unless the price is a lot lower or there's a "family pack" deal.

erichlund 06/30/2009 3:43 PM
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-7+

The example used is not a good one. Apple can sell its OS cheap, because you must, according to the license, buy their premium priced hardware to use it. Microsoft doesn't make any money on the hardware, so they have to make their profit on the software.

Bullheaded67 06/30/2009 3:55 PM
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-2+

I would agree that for the average home user a family pack would be a nice product to have on the market. For the savy computer user there is Technet.

tayb 06/30/2009 4:00 PM
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-3+

The half price sale they are having right now should be the regular retail price and Windows Ultimate is way overpriced regardless of a sale or not. Microsoft promised Ultimate features for Vista and they never happened. Anyone running a legitimate copy of Vista Ultimate should definitely get a big rebate for Windows 7 Ultimate. There should be no operating system more than $100.

theuerkorn 06/30/2009 4:03 PM
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-0+

Of course we all want the most for our money and free is certainly perfect. Nevertheless, Microsoft is in business to make money and they have all the reason to charge as much as they can ... they're still a monopoly of sorts. Regardless, Vista pricing was outrageous and the pre-sale pricing for 7 is quite reasonable. Yet, once it goes back to $120 (from $50) it's once again an expression of their status in the market, and not much we can do about it. So lets enjoy the pre-sale or switch systems.

waikano 06/30/2009 4:03 PM
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-0+

Baker has it right.....Micro needs to change the price structure, hard economic times or not. A 5 user affordable license would be great, call it whatever. And you Micro fanboys need to get off it when someone compares Micro to Apple it's going to happen. They are the top 2 OSs in the Market and even though Micro is installed on Most PCs doesn't mean they are the Only Thing going. If they had any more market share they would be a monopoly and Pricing their OS as it is would be highway robbery.

AdamB5000 06/30/2009 4:10 PM
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-2+

I like the idea behind multiple licenses for a discounted amount. I'd be more apt to buy the Home Premium for $149 (for example) with five licenses than I would a single user for $79.

scook9 06/30/2009 4:15 PM
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-0+

I know it will never happen, but i still think that all the Vista user should get a severe discount on a full retail (not upgrade) license to Windows 7. Just let Microsoft work it out so that you cannot have both the Vista and Windows 7 activated at the same time. Give us something for being the Windows 7 Beta for 3 years well using Vista.

Anonymous 06/30/2009 4:20 PM
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-0+

Microsoft,
I beg you, follow the same $30 for a single license and $50 for a family pack (as Apple does) with no gotchas for every version of Windows 7 and not as an upgrade, I'm talking about the full blown price.

And please please please, one single version in the future. Hell, it's still not too late to release a single version like Ultimate 32bit/64bit.

I say go one step further. Start blitzing mail/newspapers/point of sale counters with media of Windows 7 Ultimate in the minimalist packaging. Hand them out for free and then charge for a key online after a 30/60/90/whatever trial at the above mentioned pricing scheme. Not as a promotion! As a permanent price point.

Are you saying you won't match Apple in the one thing they are actually price friendly with?????

You can do this! People need/want this at this price. Let this be the year that Microsoft gets incredi-buzz on something positive like this. This can be truly historically positive.

brendano257 06/30/2009 4:26 PM
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-0+

Well....I'll be damned if they drop the prices that much. But if you look at it like this: If you buy a Mac for about $1000 you get about a $600-700 Windows machine. But pay for Vista Ultimate (comparing FULL featured OS) and your up at the $1050 mark, same as Apple's offering. Very estimated of course, but you see where the difference is, but Vista/7 REALLY should be much cheaper. And then there's all the nice things that come with Mac, like just working, but that is hopefully coming with Win7 =D

liquidblue 06/30/2009 4:27 PM
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-12+

If Windows 7 Ultimate was actually 50$, I'd use a legit OS for once.

brendano257 06/30/2009 4:29 PM
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-1+

sublifer :
$50 for a retail box edition (not the upgrade edition) would be nice. If they really want to cut piracy and dominate the market, that's how you'd do it. They should create an add-on software store similar to the iTunes app-store and try to make back some money there... at least that way it would be optional. Most people wouldn't even mind paying $0.99 - 5.99 for a piece of cheap software, they could even sell calculator and MS paint this way instead of including all the little freebie apps.


Cheap? I agree, but PAY for a calculator!? Never. In a heartbeat there would be sooo many free ones available it would not be worth M$'s time. Paint I could live without, but paying for basic features?....No.

Eccentric909 06/30/2009 4:37 PM
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-2+

sublifer :
$50 for a retail box edition (not the upgrade edition) would be nice. If they really want to cut piracy and dominate the market, that's how you'd do it. They should create an add-on software store similar to the iTunes app-store and try to make back some money there... at least that way it would be optional. Most people wouldn't even mind paying $0.99 - 5.99 for a piece of cheap software, they could even sell calculator and MS paint this way instead of including all the little freebie apps.



Cutting on piracy, I can see a cheaper price might help a bit (though I doubt it'd have a huge impact).. but as for market domination? They already hold on to that with the current prices or even if they charged a little more. :(

But I think we can all agree that if they slashed the price of Win7 even by just half, it'd be a win for everyone and would probably help to alleviate a bit of the "evil bad guy" image MS still carries around to this day.

doomtomb 06/30/2009 4:39 PM
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-1+

I would be willing to pay $100 for Win 7 Home Premium Retail. Too bad it's like $250 new?

lafery 06/30/2009 4:43 PM
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-2+

I see no reason whatsoever to upgrade windows until I have no other choice. It always has been too pricey for my taste to begin with so I spend as little as I can on it and the main reason is exactly that I have 4 computers at home.

The fact is, the only reason we use Windows at all is because we need it to run our other stuff: non-windows software. And those are all a LOT more useful to me than windows is. Will the new Windows run my software differently? Ok it will boot a bit faster: so what? Ok it will be prettier: so what? My browser won't suddenly become start navigating the web on its own nor gain any super-powers :p

Upgrading Windows is a luxury and the cost is too high at more than $500 for all my computers IF i took the cheap $119 one (counting taxes). Just so I can save 10 secs on boot time and have prettier UI. No thanks. When the software I need doesn't run in my current XP will I upgrade.

Now if the price was the same per Windows 7 box, but with 5 activation keys I would upgrade. Will that ever happen? Not a chance. When am I gonna upgrade Windows? Not this year :)

bizi 06/30/2009 4:54 PM
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-0+

I use Windows only for gaming, for everything else I prefer Linux (Also nearly all pc's at my university and associated institutes are Linux based). I'm not willing to pay more than 50€ for retail version of Win7 when I spend 90% of my time using Linux that costs nothing.

cregan89 06/30/2009 4:55 PM
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-7+

Having worked at Best Buy (ya ya laugh it up), nobody ever bought retail copies of Vista. They either bought a whole new computer with Vista pre-installed for a couple hundred dollars more, or they pirated a copy of Vista, or if they are tech savy, they bought OEM copies from other sources.

Even if a customer wanted Vista on their computer, they looked at the price tag of $240 and then just didn't even consider it any further. Today's consumer's simply don't value an operating system at anything in that price range. And Microsoft will never be able to sell any version of Windows no matter how great it is at a price point like that.

hemelskonijn 06/30/2009 5:12 PM
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-2+

Microsoft should lower its prices and not only for windows.
Its a known fact that over 40% of the windows installations are either pirated or in some kind of grey area.
Knowing this and keeping in mind that most of those people cant afford to buy a retail copy (or simply prioritize and go else where) Microsoft needs the pirates to be able to boast there number one position in the operating system market.
However i think cutting prices to lets say a maximum of 149 USD for retail Ultimate and dropping all other versions (except for server editions) might lead to more sales and let them penetrate markets formally held by pirated software.
Imagine what would happen if they priced it 100 USD or even less, it would be affordable for nearly any one! thus expending their market share even more.

P.S,
You can compare prices between apple operating systems and those from Microsoft.
Microsoft indeed sells no overpriced systems but they do have a way bigger home market (even mac's are often seen running windows using bootcamp or vm's).
The price of the development and such wont rise by the volume of sales its more likely it would come down and dont start me on having to give ore support if more units ship since thats their choice they could just offer windows cheap and charge for support like enterprise linux based distributions do now.

noobinberg 06/30/2009 5:24 PM
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zingam 06/30/2009 5:26 PM
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-0+

sublifer :
$50 for a retail box edition (not the upgrade edition) would be nice. If they really want to cut piracy and dominate the market, that's how you'd do it. They should create an add-on software store similar to the iTunes app-store and try to make back some money there... at least that way it would be optional. Most people wouldn't even mind paying $0.99 - 5.99 for a piece of cheap software, they could even sell calculator and MS paint this way instead of including all the little freebie apps.



The best post ever! The only reason why I'm using legal OS is because I buy laptops that have it preinstalled. MS does not deserve my money.
If my software would run on another OS I'd immediately switch.
MS is the software company that despise its customers mostly.

zingam 06/30/2009 5:31 PM
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-1+

brendano257 :
Cheap? I agree, but PAY for a calculator!? Never. In a heartbeat there would be sooo many free ones available it would not be worth M$'s time. Paint I could live without, but paying for basic features?....No.


noobinberg :
Yeah...still not buying it...bootleg it to kick the evil MS beast in the teeth.



Brendano, calculator and solitaire are not basic features of an OS. They are just crappy add-ons that nobody really needs as part of an OS. There is too much bloatware built in Windows that just takes a lot of space. It would be much better if the deliver a basic clean version that just works.
I hate that bloat and I hate that there is difference between Home and Professional versions. Because there is 3rd party software that would not run on Home versions. And most of the laptops come with preinstalled Home and no option to upgrade but to buy a new license.


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