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Microsoft Sued for XP Downgrade Fees

By - Source: Tom's Hardware US | B 22 comments

Microsoft has faced several legal complaints regarding its Windows Vista operating system, and another one has been added to the mix.

Emma Alvarado of Los Angeles County filed in federal district court in Seattle a complaint against Microsoft because she was charged a fee to downgrade from Windows Vista to XP.

Alvarado claims that she bought a Lenovo PC that was preloaded with Windows Vista, but in order to have Windows XP on it, she had to pay $59.25 for the downgrade.

"Microsoft has used its market power to take advantage of consumer demand for the Windows XP operating system by requiring consumers to purchase computers preinstalled with the Vista operating system and to pay additional sums to 'downgrade' to the Windows XP operating system," the suit alleges, according to the InternetNews.

Microsoft had originally planned to discontinue distribution of Windows XP mid-2008, but due to consumer demand, the last-generation operating system is still available for OEMs who see fit to offer it. Alvarado alleges that Microsoft extended its XP cutoff date because of the “tremendous profits” the company is raking in from the downgrades.

The charge does seem to vary between different PC vendors, leading us to believe that any “tremendous profits” to be had from offering Windows XP upgrades don’t entirely go to Microsoft. Late last year, Dell tripled its Windows XP downgrade fee to $150.

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  • 3 Hide
    mistaken , February 18, 2009 6:10 PM
    The way our Dell rep explained it was that there was not charge from Microsoft for the down grade (if we bought xp-pro equivalent of vista) but Dell was tacking on the surcharge to the lower end for having to reformat the machine from vista back to XP before sending it out to us.

    It will be interesting to see where this goes. I personally think the only money Microsoft is seeing is the difference between the home basic and what it takes to get the higher level of vista that is qualified for the down grade
  • 2 Hide
    roofus , February 18, 2009 6:43 PM
    So this person thinks that even though this Lenovo computer SKU has Vista as part of the factory configuration, Microsoft should provide a product license for free because of preference? I see this going nowhere.. Will I would hope not anyways.
  • 0 Hide
    TwoDigital , February 18, 2009 6:47 PM
    I've seen that charge too... it sounds like they're suing the wrong people if they really want their money back.

    Of course... I'll be willing to bet that they aren't suing Microsoft for their $59.25 + legal fees. They're probably suing Microsoft (again, the WRONG party) for $20 million + whatever putative damages the attorneys want to put into their pockets. Gotta love the U.S. frivolous lawsuit bandwagon.
  • 0 Hide
    AndrewMD , February 18, 2009 6:50 PM
    The problem with the average consumer is their ignorance of how things work. Windows XP (Home) or Windows XP (Professional) are two different market segmented softwares. When you add Vista Basic, Home Premimum, Business, Ultimate, etc there is cost difference associated with it.

    Now as for what companies charge to downgrade to Windows XP that is completely in their right. Companies spend lots of money to retrofit their assembly lines towards the next product. The same thing goes for any manufacturing company.

    If you want an older model car fresh from the factory, it will need to be hand built, which means someone needs to be paid for that time. Someone at Dell, Lenovo, etc needs to pull that computer off the assembly line and format the hard disk drive, manually install Windows XP and install all of the latest drivers and patches. This takes time and money.

    People need to just use what is installed on the off the shelf computer or seek out a custom PC shop local in the town to have one built for them. Then they won't be charged a downgrade fee.

  • -3 Hide
    AndrewMD , February 18, 2009 6:51 PM
    The problem with the average consumer is their ignorance of how things work. Windows XP (Home) or Windows XP (Professional) are two different market segmented softwares. When you add Vista Basic, Home Premimum, Business, Ultimate, etc there is cost difference associated with it.

    Now as for what companies charge to downgrade to Windows XP that is completely in their right. Companies spend lots of money to retrofit their assembly lines towards the next product. The same thing goes for any manufacturing company.

    If you want an older model car fresh from the factory, it will need to be hand built, which means someone needs to be paid for that time. Someone at Dell, Lenovo, etc needs to pull that computer off the assembly line and format the hard disk drive, manually install Windows XP and install all of the latest drivers and patches. This takes time and money.

    People need to just use what is installed on the off the shelf computer or seek out a custom PC shop local in the town to have one built for them. Then they won't be charged a downgrade fee.

  • 1 Hide
    bourgeoisdude , February 18, 2009 7:04 PM
    Not enough information here for us to know. What version of XP was she downgrading to and what version of Vista came on the machine?

    I know for a fact that Dell does not charge for a downgrade, but if the PC comes with Vista Home or Vista Home Premium and you "downgrade" to XP Professional, there is a cost involved. If the Lenovo PC came with Vista Business and she is downgrading to XP Professional, then there is an issue, but it isn't Microsoft's issue, it's Lenovo's.
  • 1 Hide
    ag3nt smith , February 18, 2009 7:06 PM
    If she didn't want Vista why did she buy a computer with it? Vista is a perfectly fine software after SP1. She is suing the wrong people and I somewhat wish Microsoft would counter sue Ms Emma for the time invested for this crap charge.

    Everyone is out to get some money from any way possible because of the current economy, however she has sued the wrong company and she needs to be forced with a Vista computer, and take the initiative to LEARN and be OPEN MINDED instead of COMPLAIN like many of us do. I agree with Andrew's post 100% the way. She deserved the charge and if shes gonna sue Microsoft for this; Microsoft should charge her with taking up usage of time.[/RANT]
  • -2 Hide
    seboj , February 18, 2009 7:08 PM
    This is how you spell f-r-i-v-o-l-o-u-s.
  • -1 Hide
    tayb , February 18, 2009 7:09 PM
    So... this idiot, oh excuse me, lady thinks that despite PURCHASING a license for Vista through Lenovo she thinks she is ENTITLED to a license of XP as well just because she doesn't like Vista? I was not aware of the Vista/XP bundle that Microsoft was selling...

    I am sure it will get better once I see the claim numbers. $20 million for the $60 fee and another $50 million for emotional damages that will take years of therapy to overcome.

    I would say that something is wrong with the courts that keep allowing these things but isn't their fault. It is the PEOPLE'S fault. Too many people think they are entitled to things they aren't. Same reason our economy is in a shithole. Every couple thinks they DESERVE a house despite not being able to afford one only to find out 7 years later that they couldn't actually afford it.
  • 0 Hide
    Anonymous , February 18, 2009 7:17 PM
    As a service manager at a computer store, I see a lot of people wanting their system's downgraded.

    It takes quite a bit of time to downgrade systems, and I do charge a fee for our time in doing so. Most take 2-4 hours to downgrade. The really bad ones are when you have to run the Vista install FIRST, then downgrade to xp, you are doing twice the work in those cases.
  • 0 Hide
    TwoDigital , February 18, 2009 7:19 PM
    Settle down, tayb. Obama's stimulus package will fix all of this.
  • 0 Hide
    grieve , February 18, 2009 7:40 PM


    wow, someones looking for a free ride!

    I ordered chineese food last week, swapped chicken balls for shrimp… They charged me extra!!
    I think I have a case here, anyone got Johny Cockran’s # ?
  • -5 Hide
    virtualban , February 18, 2009 7:44 PM
    The same company who has XP, and is still permitting it to be installed in the downgrade fashion, and is still providing patches for it, and still gives the right to license the OS to devices with only one core and a little bit of RAM, has decided no new machine (or something similar) should come with XP, so Dell/HP/Lenovo are very happy to comply because else they would just have to install XP at no other cost. I believe MS is using their monopolistic situation to get their hands to money and a lot of it. And loosing market share is a very good way that shows people giving them the finger.
  • -5 Hide
    virtualban , February 18, 2009 7:46 PM
    yeah, yeah, they have the right to do whatever they want, it's their product after all, and they don't want to spend resources on patching it, but they do, they spend resources on patching it, they do allow XP to be installed on lesser machines, and XP will outlive Vista (I'm not the only one who thinks that)...
  • 0 Hide
    jhansonxi , February 18, 2009 8:09 PM
    Some Vista licenses allow downgrading. Just search with Google for "vista downgrade rights". As with previous versions of Windows M$ doesn't provide media and you have to activate over the phone and give them the Vista key.
  • 0 Hide
    ccstooge , February 18, 2009 9:51 PM
    Except Dell doesn't charge $150, at least not in the SMB line (which our IT company resells). When you go with the mid-high grade models, there is typically no cost difference between Vista Business and XP Pro downgrade. The most I have seen in the SMB section is $99 though, which is usually for the low end systems. If people spend a little extra money and get a decent system, instead of one that is crap and they'll complain about in 3-12 months (**cough original Vista Home users!**) they can downgrade if they so choose and even get to avoid all the extra garbage programs that just slow down their systems more.
  • 1 Hide
    MrBradley , February 18, 2009 11:52 PM
    Being an employee at a computer store and having to downgrade vista computers to XP, Im not surprised they charge them much more. The actual process sucks. Most of the hardware that companies like HP and Dell only include Vista Only parts, none if which work with XP, thereby making my day miserable when I have to tell a customer that some random part (usually being a fingerprint reader or something) will not work on their reloaded pc.
  • 0 Hide
    Anonymous , February 19, 2009 1:17 AM
    I posted this in the other thread as well... Not intentionally spamming my thoughts, just felt it would be appropriate to post here too.

    First off - THe XP downgrade rights are very misunderstood by the consumer.

    In order to understand downgrade rights, you first have to understand what the COA (Certificate of Authenticity) on the bottom or back of the machine grants you. Any machine that runs windows, and purchased via a large manufacturer like Lenovo, Dell, HP, etc requires a COA. The COA is considered the base hardware license for windows that follows that machine till it is sent to the pc graveyard.

    Under typical licensing in the corporate environment, a COA has to be present even if your company has a volume license holder/Enterprise Agreement/software assurance with Microsoft. The ability for a company, school, etc to install windows with their own native install from scratch is considered an "upgrade" by Microsoft. Now, point to make - the volume licensing is cheaper per seat than a retail copy of the same OS... That's why when you buy retail XP/Vista or if you buy one of the system builder or "OEM" copies off of new egg, it has a different cost structure.

    So, along comes Vista, and under standard MS licensing terms, a Volume install of XP would typically not be legit even with the Vista COA. MS amended the rules for that and made an exception for downgrading to xp and still being compliant with MS licensing terms.

    This downgrade offereing was primarily and still is targeted at businesses that still want to run XP. Unfortunately, the consume felt they also fell into the same boat.

    The mistake made by consumers is in assuming the the downgrade rights grant them a free copy of the XP install for that PC. It does not. A consumer who has a full retail copy of XP or system builder copy doesn't even fall into the downgrade rights category anyway as those are considered fully licensed stand alone installs based on their price structure.

    So, if a consumer wants XP instead of vista, they can call the vendor they bought the system from, and that vendor will charge them for the XP recovery media, and shipping.

    MS and the vendors are doing absolutely nothing wrong here. The only thing wrong is how little people understand about that dang COA.
  • 0 Hide
    falchard , February 19, 2009 6:18 AM
    She sued the wrong company. You sue the OEM not the software manufacturer. DELL and Lenevo could have pre-installed machines with Windows XP as it wasn't out of distribution with OEMs. Instead they decided to tack on an extra amount to the bill for the OS. Thats entirely the decision of those particular companies.
  • -1 Hide
    jabliese , February 19, 2009 1:37 PM
    Keep in mind we are talking about big box OEM's and their downgrades. Appreciating what the small builders who have posted here are saying, at Dell the downgrade process should go like this:

    1) Open box.
    2) Grab hard drive with XP downgrade.
    3) Swap hard drives.
    4) Close box.
    5) Run hardware test, and ship.

    Dell does not spend hours on an XP downgrade.
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