Vista: Expect a Premium Push (with Premium Prices)

Microsoft still isn't talking specifics regarding its Windows Vista pricing plans. But company watchers are predicting the Redmond software maker could reap big rewards from its planned premium edition push.

Microsoft is still holding many specifics about Windows Vista—pricing among them—close to the vest. But the Redmond, Wash., companys reticence to talk isnt stopping company watchers from speculating.

Goldman Sachs & Co. analyst Rick Sherlund issued a research note earlier in April, noting that Goldman is now figuring Microsoft could garner an extra $1.5 billion per year in revenues simply by persuading users to buy the premium Vista versions.

Microsoft announced earlier this year that it is readying six core Vista packages, or SKUs: Windows Starter 2007, Windows Vista Enterprise, Windows Vista Home Basic, Windows Vista Home Premium, Windows Vista Ultimate and Windows Vista Business.

/zimages/3/28571.gifMicrosoft is set to roll out a new test build of Windows Vista. Click here to read more.

In February, company officials reiterated Microsofts goal to persuade more customers to opt for Vistas premium SKUs—specifically, Vista Enterprise, Vista Home Premium and Vista Ultimate—when selecting their next-gen Windows operating system. Rather than upping Windows Vistas price, Microsoft will be able to maintain and grow its Windows revenues by getting people to buy in at a higher price point, company officials have decided.

Currently, the estimated retail price of Windows XP Home is $99 per copy for an upgrade, and $199 for a full version. For XP Professional, those prices are $199 and $299, respectively. But Windows XP Media Center Edition, which is an example of a current-day "premium" version of XP, sells for $320-plus per copy.

Retail sales make up a relatively small part of Microsofts Windows business, however. Microsoft obtains more significant shares of its Windows revenues from PC makers on the consumer side, and volume licensees on the business side.

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