Microsoft Slashes Prices for Windows Vista SP1

Service Pack 1 is not the only evolution of Windows Vista on the immediate horizon, that has been cooking over in Redmond. Microsoft announced that it had been baking a price cut for the retail stand-alone versions of the Windows operating system. Throughout 2007, Microsoft has been testing the waters across various markets around the world, via Vista promotions. The company explained that it had test driven a few marketing strategies involving the stand-alone versions of the platform at lower price points.

As a direct consequence of the success of the promotions implemented in the past year, Microsoft has taken the decision to revamp the Vista pricing structure in order to make the operating system more appealing to a broader range of consumers worldwide once Vista SP1 hits the shelves. "These price changes will take effect globally with the retail release of Windows Vista Service Pack 1 later this year, though some markets will see reduced prices sooner as a result of promotions many of our partners already are driving," revealed Brad Brooks, corporate vice president for Windows Consumer Product Marketing at Microsoft.

The Redmond company sells the vast majority of its Windows operating systems pre-loaded on the machines delivered by its OEM partners. Microsoft specified that the Vista SP1 price slash will impact exclusively the stand-alone retail versions of the platform. With in excess of 80% of the Microsoft Client division's revenue coming from original equipment manufacturers, the market for retail versions of Windows does present opportunities for growth, but not even close as with the OEM PCs. However, it it clear that the Redmond company has identified a demand.

Microsoft will tailor the new price cuts in accordance to developed and emerging markets. As far as developed countries go, the company will lower the price of the upgrade retail versions of Vista SP1 for the Home Premium and Ultimate SKUs. This will mean that Vista Ultimate upgrade version will go for as little as an estimated retail price of $219, down from from $299, while Premium will fall from $159 to $129. In emerging markets, there will no longer be full and upgrade versions of Vista Home Basic and Vista Home Premium, as the upgrade variants will be melted away into the full package. But for developed countries, Microsoft has yet to specify the price cuts.

"Today we announced a variety of price reductions for copies of Windows Vista sold on retail shelves. In developed markets, the price changes will most notably impact upgrade retail versions of the new editions we introduced in 2007 -- Windows Vista Home Premium and Ultimate editions. In emerging markets, we are combining full and upgrade Home Basic and Home Premium versions into full versions of these editions and instituting price changes to meet the demand we see among first-time Windows customers who want more functionality than is available in current Windows XP editions. In addition, we are also adjusting pricing on Windows Vista Ultimate in emerging markets to be comparable to price changes developed market customers will see," Brooks added.



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