Linked by Thom Holwerda on Wed 31st Aug 2011 19:42 UTC
Windows Over the past few days, Microsoft has been talking about improvements made to Windows 8 on its 'Building Windows 8' blog at MSDN. Strangely enough, the improvements mentioned were either dealing with the classic desktop, or were demonstrated using the classic desktop - and not the fancy Metro user interface which is supposed to be Windows 8's big new thing. Today's post finally gives a little more detail about how the classic and Metro UI work together, but questions still remain.
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Microsoft's Daft Prices
by Richard Dale on Thu 1st Sep 2011 16:23 UTC
Richard Dale
Member since:
2005-07-22

On Dell's Spanish website a copy of Windows 7 Home Premium costs 197 euros, and a copy of Windows 7 Ultimate cost 311 euros. You can actually buy quite a nice computer for the cost of these OS's. A Dell netbook or a Zino are priced about the same as Home Premium and Ultimate respectively, even though they include a Microsoft OS. An upgrade to Windows 7 Home Premium, where you already own a copy of an older Windows, even costs 125 euros. Or if you have a Dell netbook with Windows 7 Starter it will cost you 82 euros to upgrade to Home Premium.

Obviously tablets are very price sensitive, and if they cost 100-300 euros more than they otherwise would, then people won't buy them. If your tablet drops into something as ugly as the proposed new Windows 8 Explorer UI, then people won't buy them either, even if they cost as little as a Meego/Android/Plasma Active tablet without that extra 100-300 euros Microsoft tax.

I can only see the combination in Windows 8, of Windows Phone 7 Metro style and Windows 7 'ugly style' as a way of holding up revenues. It doesn't appear to be something anyone other than Microsoft would want to have. I just don't understand how Microsoft is charging more for their OSs than they were a few years ago when the hardware was nearly 10 times as expensive. It only works if they have a monopoly as they do for pre-installed desktop OSs. But they don't have a monopoly on tablets, and I just don't see how they can possibly get away with charging the same money for a tablet OS as they do for a desktop OS.

Reply Score: 1

jabbotts Member since:
2007-09-06

When you buy Windows Home or Pro in a box for 190+ euros, your paying the retail price point; what they are able to charge the consumer for a nice boxed up copy of Windows install disks. I suspect there is some "not OEM customer" type support included but your mostly paying the true retail price point.

When you buy Wnidows pre-installed on a new machine, you are buying an OEM license previously sold to Dell or whomever and now re-sold on to you. Dell buys in large numbers so they get a volume discount. Dell also has a contract with Microsoft which probably trades some favours for an even lower price per unit. In the end, they are going to pay between 12$ ~ 50$ per Windows license to be included into computer on consumer's behalf.

So, the Windows EULA claims a customer may return Windows unused for a full refund. You can "opt-out" of paying the Microsoft tax if you are not going to be using the Windows OS; it's a matter lf plowing through grief from the vendor and microsoft until one of them pays up. You'll only get about 35$ refunded though; the plausable OEM cost of the Windows license.

If you can find a vendor who sells the OEM license versions then you'll get it cheaper.

On Newegg, 240$ for win7 Pro retail, 130$ for win7 Pro OEM.

http://www.newegg.com/Product/ProductList.aspx?Submit=ENE&DEPA=0&Or...

But, you may have limitations with the OEM version. I've read that it binds to the hardware and only accepts so many major component changes or re-installs before you'll need to call Microsoft and have it unlocked. I have an impending re-install that may test this claim officially.

So:
You can get Windows cheap as a pre-install; benefits Microsoft by growing/maintaining market share.

You can get Windows OEM and do your own install accepting potential limitations coded intot he OEM version license.

You can get Windows Retail and pay the full retail price but without the likelyhood of limitations.

You'll pay a different price depending on how you obtain your license copy. Hurray for product pricing based on "what the market is willing to be robbed off" instead of "fair markup on top of our cost to produce".

Reply Parent Score: 1

Richard Dale Member since:
2005-07-22

When you buy Windows Home or Pro in a box for 190+ euros, your paying the retail price point; what they are able to charge the consumer for a nice boxed up copy of Windows install disks. I suspect there is some "not OEM customer" type support included but your mostly paying the true retail price point.

When you buy Wnidows pre-installed on a new machine, you are buying an OEM license previously sold to Dell or whomever and now re-sold on to you. Dell buys in large numbers so they get a volume discount. Dell also has a contract with Microsoft which probably trades some favours for an even lower price per unit. In the end, they are going to pay between 12$ ~ 50$ per Windows license to be included into computer on consumer's behalf.

So, the Windows EULA claims a customer may return Windows unused for a full refund. You can "opt-out" of paying the Microsoft tax if you are not going to be using the Windows OS; it's a matter lf plowing through grief from the vendor and microsoft until one of them pays up. You'll only get about 35$ refunded though; the plausable OEM cost of the Windows license.

If you can find a vendor who sells the OEM license versions then you'll get it cheaper.

On Newegg, 240$ for win7 Pro retail, 130$ for win7 Pro OEM.

http://www.newegg.com/Product/ProductList.aspx?Submit=ENE&DEPA=...

But, you may have limitations with the OEM version. I've read that it binds to the hardware and only accepts so many major component changes or re-installs before you'll need to call Microsoft and have it unlocked. I have an impending re-install that may test this claim officially.

So:
You can get Windows cheap as a pre-install; benefits Microsoft by growing/maintaining market share.

You can get Windows OEM and do your own install accepting potential limitations coded intot he OEM version license.

You can get Windows Retail and pay the full retail price but without the likelyhood of limitations.

You'll pay a different price depending on how you obtain your license copy. Hurray for product pricing based on "what the market is willing to be robbed off" instead of "fair markup on top of our cost to produce".


I don't disagree with what you say. But the 35-300 dollars a manufacturer has to pay to Microsoft per machine is enough to make it very hard to make a profit. Because that kind of money is a very large part of the profit margin, like nearly all of it. You talk about 'probably trades some favours for an even lower price per unit', but those favours probably involve restriction on selling other OSs like Linux preinstalled. That might work in the context of the current desktop monopoly that Microsoft has, but not in the case of Tablet OSs where Dell or whoever might well have Android Tablets which are selling quite well when Windows 8 finally comes out.

I don't think the same economics and business model will work in the tablet market. If a manufacturer like Dell is already selling other tablets like Android or Meego based devices that don't have a per device fee that needs to be paid to Microsoft, then why would they want to develop devices that the have to pay extra for with features that nobody wants, like an extremely ugly Windows Explorer running on the tablet?

It makes no sense to me why Microsoft aren't scaling up Window Phone 7 and creating an OS targeted at just tablets with appropriate pricing (ie something like giving it away for -10 to +10 dollars as per WP7), rather than adding tablet support to the expensive Windows 7 to create Windows 8.

Reply Parent Score: 2

lucas_maximus Member since:
2009-08-18

TBH Microsoft when it comes to licenses only really seem to care about 1 copy per machine ... I have had the same copy of Win7 OEM on 2 different machines now ... no big problem really.

I am pretty sure they do it against the hardrive unique identifier ... The most effort was free telephone activation which took less a few minutes.

Edited 2011-09-01 20:53 UTC

Reply Parent Score: 2