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Microsoft Pitches Lowball Windows 8 Upgrade Price

By Rachelle Dragani
Jul 3, 2012 10:47 AM PT

An upgrade to the Pro edition of Microsoft's next operating system, Windows 8, will sell for US$40, a significantly lower price than what the company has charged for upgrade packages in the past.

Microsoft Pitches Lowball Windows 8 Upgrade Price

The offer applies to purchases made through for PCs running Windows XP or a later version. The price is a reduced promotional rate that will run through the end of January, 2013. Until then, a packaged DVD upgrade to Windows 8 Pro will be available for $70.

The Windows 8 package will come with an upgrade assistant to walk the user through the process.

The upcoming OS will feature a so-called Metro start screen and Metro-style apps designed with touchpad customers in mind. The design reflects the Metro theme already found on the company's Windows Phone platform.

Microsoft hasn't revealed the official launch date of Windows 8, but it said the promotional price will begin as soon as the operating system is available.

Microsoft didn't respond to our request for further details.

Smooth Transition

The $40 promo price is much lower than the cost of past Windows upgrades. Packages that upgrade a user's system to Windows 7, which was released in 2009, still run as high as $120. The lower upgrade price puts Redmond more in line with competitors such as Apple, which charged $29 for recent OS upgrades, and which plans to release an upgrade to its upcoming Mountain Lion OS for $20.

"That's definitely an aggressive price. I can't remember a major Windows upgrade costing less than $100 or so," Dan Olds, principal analyst at Gabriel Consulting Group, told TechNewsWorld. "I think they're certainly responding to competitive pressure from other platforms and devices like tablets and even smartphones."

Coming down on price is a smart move, since updating can sometimes be a messy process for the mainstream user or large corporate entities, said Olds.

"Upgrades are always at least something of a hassle," he said. "By reducing the cost so much, Microsoft is making the upgrade highly attractive -- assuming the new OS is technically solid and provides some additional benefits versus Windows 7."

Creating Buzz

Besides paving the way for a smooth transition, Microsoft may need to convince customers to make a speedy transition over to Windows 8, said Olds. The upgrade market for Microsoft is an important one, he explained, although a majority of users take much longer to update on their PCs.

"There's always a lag when it comes to upgrades, with plenty of folks holding back as long as possible," said Olds. "But with a price this low, Microsoft might garner a lot more upgrades, faster than they've seen before."

However, an aggressive price could also create the kind of buzz that Microsoft doesn't need, said Michael Silver, research vice president and distinguished analyst at Gartner. With the company designing the operating system with mobile users in mind, it needs to make sure there is a positive PC user experience before it pushes a competitive price point, he said.

"Running Windows 8 on an older PC, especially one without a touchscreen ... won't be a great experience for users," he told TechNewsWorld. "That could lead to problems for Microsoft. Microsoft needs good buzz around Windows 8, and they won't get it from users that try to run it on PCs that don't provide a great experience."

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