It is hard to argue with the notion that the development of Windows 7 has been masterfully executed. The OS has been generating good mojo, it has proved tremendously popular, and its performance is a cut above its much-maligned predecessor. Yet as Windows 7 winds its way towards a winter release, Microsoft has yet to reveal the most contentious source of speculation: Price. Should Microsoft fail to price Windows 7 in accordance with buyer expectations, the firm may significantly damage the positive momentum it has generated with the new OS throughout the year.
Discussing the cost of an operating system amongst consumers is a request for conflicting opinions. Some, such as the Linux community, make the ideological argument that an OS should be a free product of the many, while the Microsoft faithful approach the topic each according to their own—and vastly different—sense of economy.
While the value of an operating system remains mired in personal conviction, it is evident that Windows Vista was generally perceived to be too expensive. With prices for a full retail edition checking in at $199 to $399 US, Windows Vista was repeatedly lambasted for a cost that many considered to be outrageous. While the less desirable upgrade editions were much cheaper, many were still content to pan Vista’s prices across the board.
Distressingly, Windows 7 appears to be on a collision course with even higher prices. In a recent interview conducted by cnet, Dell’s Director of Product Management for the Business Client Product Group Darrel Ward warned that Windows 7’s prices will exceed that of Vista’s.
“If there’s one thing that may influence adoption, make things slower or cause customers to pause, it’s that generally the ASPs (average selling price) of the operating systems are higher than they were for Vista and XP,” he said.
“In tough economic times, I think it’s naive to believe that you can increase your prices on average and then still see a stronger swell than if you held prices flat or even lowered them. I can tell you that the licensing tiers at retail are more expensive than they were for Vista.”
While Ward’s claims will not be substantiated until Microsoft officially unveils Windows 7’s pricing, it is an ill omen for an OS that is otherwise generating significant to-do. If businesses and their deeper pockets are growing increasingly wary of the price of things to come, we can only wince at the impact a high price for Windows 7 may have on both Microsoft and the good will it has built.
As the economy worsens, public resentment towards Vista remains high, and losses to competitors in the search, phone, music, advertising and console markets continue to mount, Windows 7 could be the product that buoys Microsoft in the storm. It would be a shame if the firm stumbled when playing the final card in the most important hand it has held in years.
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