Retail Windows 7 Prices Announced, Upgrades Half Off For The Next 2 Weeks

For retail upgrades:

• Home Premium Upgrade: $119
• Professional Upgrade: $199
• Ultimate Upgrade: $219

This doesn't include OEM pricing. OEM versions cost significantly less since the license is non-transferable from one computer (defined as a motherboard by Microsoft) to another, but due to volume discounts we don't know what the exact pricing will be. Individual units tend to go for one-half the price of a full retail kit, so adjust accordingly.

This means that we also don't have the prices for Home Basic and Starter. Home Basic is limited to developing countries, but Starter is not. Presumably Starter is going to be dirt-cheap (relatively speaking) to match the margins of the Netbooks Microsoft is trying to pair it with. Copies of XP for use on Netbooks have been rumored to be as cheap as $15 for the biggest OEMs.

Of note, users hoping for a cheap upgrade path from Vista are going to be disappointed. The retail upgrade kits are for Vista and XP, and are priced accordingly. This may be good for picking up the stragglers who are still on XP, but it's not going to do any favors for Microsoft in picking up Vista users. Vista-to-Win7 pricing is likely too high for the limited differences between the two.

As compared to Vista pricing, Win7 Home Premium is roughly 10% cheaper than it is for Vista, in particular hitting the somewhat magical $199 price point for a full version that Vista Home Premium never reached. I had been expecting Microsoft to do $99 for the Home Premium upgrade (never underestimate the value in manipulating consumers when superficially chopping off a digit in a price) but it looks like that's not in the cards.

Win7 Professional prices are unchanged compared to Windows Vista Business. Microsoft will be selling this as a reasonable price since Win7 Professional is not stripped of Home Premium's features like Vista Business was, but the OEMs in particular aren't going to be amused. There has been some saber rattling recently between some of the OEMs and Microsoft over this matter, as they wanted the price to come down on Professional/Business to shore up their margins.

Last, Ultimate is going to be priced significantly lower than it was for Vista's launch, although in recent months it has been priced lower because of slow sales due to its silly price in the first place. Microsoft's list price of $319 is well above what Vista Ultimate is going for right now ($250 at Newegg) so some things may still be in flux, or Microsoft is trying to burn off boxed copies of Vista Ultimate. Regardless, Win7 Ultimate will only be priced $20 above Win7 Business, an appropriate price given the few differences between it and Professional. However given that it's just a few differences and Microsoft's own intentions to downplay it, it's probably not going to be a big seller.

On a final note, Microsoft is starting to pander to the bargain hunters early, so if you have been waiting for a Win7 version of Power Together, The Ultimate Steal, or other Microsoft discount promotions, pay attention. Microsoft will be taking pre-orders for Win7 upgrades through some of their closest retail partners (Newegg, Best Buy, etc) starting tomorrow and ending July 11th. The Home Premium and Professional upgrades will be priced at $49 and $99 respectively. I'll update this post tomorrow with links once we have them.