Another example of Microsoft lacking business acumen

Sun, Apr 26, 2009


When Microsoft releases Windows 7, the version that comes with netbooks will only be able to run a maximum of 3 applications at a time.  And in typical Microsoft fashion, the base edition of Windows 7 will also lack many of the features available in more expensive versions of the software.

It’s bad enough that Microsoft is offering stunted software to its users, but it’s even worse that Microsoft alerts customers to that fact via its upgrade program.  BusinessWeek reports:

Because of the smaller size of Windows 7, three versions of the program will come loaded even on lower-end machines. If a consumer on a cheaper PC running the “Standard” version tries to use a high-definition monitor or run more than three software programs at once, he’ll discover that neither is possible. Then he’ll be prompted to upgrade to the pricier “Home Premium” or “Ultimate” version.

Microsoft says the process will be simple. Customers enter their credit-card information, then a 25-character code, make a few keystrokes, then reboot. Brooks says pricing hasn’t been determined, but upgrading “will cost less than a night out for four at a pizza restaurant.”

Simple, I’m sure.  And a night out for four at a pizza restaurant ain’t so cheap either.  Unless, of course, you split it 4 ways.  In which case, why not use a completely different analogy?

Rightly or wrongly, customers who purchase a $399 netbook will inevitably feel like Microsoft is trying to scam them into purchasing a more expensive version of Windows 7 in order to access features that they most likely thought would have worked right out of the box.  That can’t be good for Microsoft’s image in the long run.

Thoughts?  Please chime-in in the comments below.


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2 Comments For This Post

  1. Ravi Khalsa Says:

    This while Steve Ballmer says Apple is charging a premium for their name while giving nothing.

  2. Richard Says:

    Although I hat M$ and the price scheme they have, i must say that on a $399 notebook anyone would know they are not getting high end gear.

    Its easy to say Apple only has one price when you pay a premium already. Which for me is more than fine. I have no problem paying for quality.

    BTW, why would anyone paying $399 for a notebook want to run more than 3 apps anyway?? Someone paying that is only surfing the web and checking email anyway.

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