Microsoft Offers Discount Coupons for Upgrade to Windows Vista OS

Oct 25, 2006

Microsoft Offers Discount Coupons for Upgrade to Windows Vista OS

Coupons will allow consumers buying a PC now to upgrade from XP to Vista in 
2007, but there are costs.

Ben Ames, IDG News Service

Tuesday, October 24, 2006 02:00 PM PDT

In an effort to mollify hardware vendors worried that delays in the Windows 
Vista launch will dampen holiday PC sales, Microsoft is offering a discount
to consumers and small businesses that want to upgrade from Windows XP to the 
Vista operating system.

Microsoft will offer the upgrade coupon to shoppers who buy a Vista-capable PC 
between this Thursday, October 26, and March 15, 2007, allowing them to redeem
the coupons for a free or discounted upgrade from Windows XP to Windows Vista 
and from Office 2003 to Office 2007.

The timing indicates that Vista will be delivered at the end of March unless 
Microsoft again delays its shipment.

The exact cost of the upgrade will vary among PC vendors. For instance, HP will 
offer its new North American customers a free upgrade from Windows XP Home
to Windows Vista Home Basic, XP Media Center Edition 2005 to Vista Home 
Premium, or XP Professional to Vista Business. The offer applies to those who 
buy
an HP Pavilion or Compaq Presario desktop or notebook PC or an HP Digital 
Entertainment Center, if it includes a qualified XP system, is Vista-capable,
and is purchased within the coupon dates.

Other vendors may charge "a nominal fee" to upgrade from Windows XP 
Professional, XP Tablet PC Edition, or XP Professional x64 Edition to Windows 
Vista
Business or Vista Business 64, Microsoft says. Read more about
Microsoft's upgrade program ,
called Express Upgrade. PC World
took a hard look at the program
and found there are costs, both in time and money, that you should consider 
before buying a new PC in 2006.

Who Is Affected?

The program is a moot point for users under Microsoft's volume licensing 
program, who are expected to get access to Vista at the end of November.

But consumers, small businesses and companies buying desktop PCs labeled 
"Windows Vista capable" will be eligible for the Vista upgrade coupons.

Microsoft hopes the coupon program will help drive holiday PC sales. In March, 
Microsoft again delayed the shipment of Vista moving it from Dec. 2006 to
the first quarter of 2007. The move appeared to leave PC manufacturers out in 
the holiday cold.

The Importance of Holiday PC Sales

Vista offers features like translucent desktop windows, improved performance of 
digital music and photography, and data backup for business users. But those
features come at the cost of greatly increased demands on hardware performance. 
A Vista-ready PC must have at least 512MB of memory and an advanced processor
and graphics card.

PC vendors and component manufacturers stand to profit from the boost in demand 
for those parts, but they have grown increasingly nervous about missing
the holiday sales season as they watched Microsoft bypass several earlier 
deadlines for shipping the new OS, analysts say.

"I definitely see it as a move by Microsoft to appease PC vendors and key 
component manufacturers such as Intel. Microsoft has very little goodwill left
with the vendors, having disappointed them several times with Windows Vista 
delays," Martin Kariithi, a hardware analyst with Technology Business Research,
says.

In fact, he adds, this is a smart way to achieve that goal, since Microsoft 
will probably incur only a small charge to maintain the coupon program and 
should
not lose much potential profit compared with the full Vista sales price.

Also, Microsoft will share the costs of the upgrade program with vendors like 
Hewlett-Packard, which has an interest in giving consumers enough confidence
to buy PCs now instead of later.

"We do believe that the Vista Express Upgrade program will help early adopter 
customers who prefer to upgrade to Windows Vista, but [who] would also like
to take advantage of the myriad promotions and discounts typically offered 
during the holiday period," HP spokesperson Tiffany Smith said in an e-mail.

Coupons Also for Microsoft Office 2007

A parallel program called Microsoft Office Technology Guarantee Programs will 
provide similar upgrades to those that purchase editions of Microsoft Office
2003. The PCs and Office software must be purchased from a certified Microsoft 
OEM or "smaller computer makers, known as system builders," according to
Microsoft.

In addition, those who buy stand-alone versions of Office 2003 between Oct. 26 
and Feb. 28, 2007 also will be eligible for the Office upgrade plan.

Users under either program will receive discounted offers on Windows Vista and 
the 2007 Microsoft Office system, which is now the center of Microsoft's
real-time collaboration strategy.

The upgrade program is expected to include free and low-cost upgrades based on 
the version of the operating system or Office software purchased.

According to the Vista team blog, users will be charged a "nominal fee" when 
upgrading from Windows XP Media Center Edition 2005 to Windows Vista Home 
Premium;
Windows XP Professional to Windows Vista Business; Windows XP Tablet PC Edition 
to Windows Vista Business; and Windows XP Professional x64 Edition to Windows
Vista Business 64.

Upgrades from Windows XP Home Edition to Windows Vista Home Basic or Windows 
Vista Home Premium will be available at a "50% discount from the boxed product
upgrade price, plus shipping and handling."

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Vikas Kapoor,
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