Retail Vista Price Reductions

When Windows Vista SP1 enters the retail channel later in 2008, Microsoft will reduce Vista prices and simplify the product lineup in emerging markets. The price changes only affect stand-alone retail pricing and therefore may not have much impact on Vista sales, because most consumers buy Windows preinstalled on a computer. Moreover, confusion about which version of Vista to buy or what hardware it runs on may be a greater barrier to retail adoption than price.

Price Changes Vary by Market

While the majority of Windows licenses are sold to customers purchasing new computers, software retailers and system builders sell full packaged product editions. Customers who purchase Windows at retail are typically technology enthusiasts or hobbyists who want to install the latest version of Windows on their computers. Microsoft hopes that price reductions will increase demand for Vista among all consumers.

Microsoft has run several promotions on Vista since its initial release. For example, in late 2007 and early 2008, Microsoft ran promotions discounting Vista Home Premium in the United Kingdom and saw several months of significant sales increases. Microsoft says that feedback from this and other promotions show that there is demand for Vista in the retail channel, but that price is a factor.