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The Microsoft Rip-off Report: Pay and Pay Again

Well, the pricing for buying Windows 7 has been officially announced, in case anyone cares. Understand that Apple has already informed users of Mac OS X Leopard that they can upgrade to Snow Leopard for a mere $29. Since most of the Intel-based Mac user base is using 10.5, you can regard that as, essentially, the main upgrade package.

For those still using Tiger, you are forced to buy Snow Leopard in a bundle that includes iLife ’09 and iWork ’09, but the increase in price above buying those two application suites separately is actually a mere $11. Such a deal!

Add to this the fact that Microsoft has been busy attacking Apple with this ubiquitous Laptop Hunter ads, both online and on TV, in which a fake buyer picks a PC over a Mac because it’s cheaper.  Now you regular readers know that I find those spots to be obnoxious and boring, and their deceit over selecting models that don’t fulfill the would-be purchaser’s stated needs is just overwhelming. Indeed, now that Apple has reduced the price of most of its note-books, other than the basic white MacBook, the insinuation of higher prices for Macs is even more misleading.

Surprisingly, I haven’t seen any changes in those spots (though I suppose they could be in the works), but we do know the upgrade tax for Windows 7 now, and it ain’t cheap, regardless of which version you select.

A Windows 7 Home Premium upgrade, for example, weighs in at $119.99 and it’s $199.99 if you choose the standard retail product. However, many Windows users simply buy new PCs, or, if they want to upgrade, they will opt for an OEM version, the same edition that is sold to manufacturers, for a lot less money.

However, Apple plays in a different league. There is no feature-limited version of Mac OS X. You get one size fits all, with every single feature present and accounted for. Thus the real equivalent product to Snow Leopard is actually Windows 7 Ultimate, for which the upgrade price is $219.99 and the full version is $319.99. Ouch!

In the European Union, where Microsoft faces an edict about excluding third-party browsers, they will evidently offer only retail packages and not upgrade versions for the time being, until things sort themselves out. Serves them right, I suppose.

To be sure, Microsoft’s price policies and alternatives are nothing if not complicated. So if you preorder Windows 7 after June 26th, and until July 11th in the U.S. and Canada, you can get the Home Premium version for $49.99 and the Professional edition (which sits between Home Premium and Ultimate) for a “mere” $99.99. I don’t have the space or patience to list the pricing in other countries.

So we really should be talking about the Microsoft Tax here.

Now please don’t consider this an all-out attack on Windows 7. It’s not fair to review a product before it’s actually released. In fact, the folks who have evaluated the prerelease editions say it’s faster and far more reliable than Vista, although it shares the same core structure. Maybe it won’t come close to Snow Leopard, but a better Windows will help egg on Apple to excel as well, and that’s a very good thing. Besides, since a large number of businesses do depend on Windows, you really want them to run efficiently and reliably. The next time you wait on the phone for long minutes because of a computer crash, you’ll know what I mean.

In any case, this whole strategy once again demonstrates to one and all that Microsoft remains without a clue as to what they ought to be doing to better market their products. They are so used to dealing with business users who hold long-term subscriptions and PC makers with huge contracts that they simply cannot comprehend the needs of regular people. Their brain-dead upgrade and full version price policies clearly indicate this. The special preorder price will conflict with the vacation plans of many potential customers, and without a major publicity campaign to accompany this special offer, I expect most Windows users will simply miss it.

Or maybe that’s Microsoft’s real intention. For people who complain the upgrade prices are too high, they can point to their special marketing initiative, even though it will too late for customers to take advantage of it. I do suppose that Microsoft could extend the offer. A better idea, though, would be to give customers a few months, perhaps until the official release date, and be done with it. I’m willing to say that they’ll get a lot more orders and far more income than they would receive from full price purchases.

But it’s not my place to tell Microsoft what to do. Clearly, up until recent years, they have managed to succeed with most of their new product initiatives, despite being largely retreads of innovations pioneered by their competitors. Even if Windows 7 is as miserable a failure as Vista, you can bet Microsoft will still make boatloads of money from it, and that’s all they care about, really.