October 24, 2006 1:15 PM PDT

Holiday PC buyers get Vista upgrade promise

Computer buyers who pick up a new PC this holiday season won't get the latest version of Windows or Office, but they can score a discount if they decide to upgrade later.

Those who buy a system with Windows XP or Office 2003 between Thursday and March 15 will be eligible to move up to Windows Vista or Office 2007. The terms of the Vista "Express Upgrade" offer will vary from one PC maker to another, Microsoft said Tuesday. In some cases, the upgrades will be free, while in some other cases, they may require the customer to pay up to half the price of the updated software.

"We do expect there will be many cases where it will be a free upgrade or just the cost of shipping and handling," said Brad Brooks, a general manager in the Windows product marketing unit.

As for Office, computer makers will include a coupon that allows PC buyers to get a similar version of Office 2007 by mail from Microsoft for the cost of shipping and handling.

What's the upgrade?

People who buy from smaller PC makers will get their new software directly from Microsoft. This is what's on offer for U.S. shoppers:

XP version Vista upgrade
Media Center 2005Home Premium
Tablet PCBusiness
Professional x64Business 64
HomeHome Basic (half price)
HomeHome Premium (half price)

Those who buy from bigger PC makers will get their upgrade through those companies. Here's what Hewlett-Packard is offering free, plus shipping and handling:

HomeHome Basic
Media CenterHome Premium

Microsoft had long hoped to have Vista on store shelves in time for this year's holiday buying season. It said in March, though, that the Windows update would not be ready to be put on PCs for sale until January, casting a cloud over the busiest computer-selling season of the year.

Brooks said Microsoft hopes the Office and Vista upgrade programs will allay any concerns people might have about buying a PC for the holidays. The company has been working for the past few months on coming up with a program that met with approval from computer makers and retailers.

"The holiday season is a big season for PC sales," Brooks said. "Our partners did not want to see a slowdown because consumers might have an objection."

Deferred gift
But a coupon makes a lousy stocking stuffer, said Michael Cherry, an analyst with Directions on Microsoft. "If you were a young child, and you really wanted a bicycle this Christmas, how would you feel when you wake up Christmas morning and your folks give you a picture of it and say they will give it to you as soon as it is ready?" Cherry asked. "I am not surprised they are doing it. But I am not sure how much impact it is going to have."

Also, getting a coupon means manually upgrading the operating system. "The upgrade could be fairly seamless, but it might not be," said Roger Kay, an analyst at Endpoint Technologies Associates. "As the consumer, you want to get this thing preloaded so it will just run."

Vista's arrival after the December shopping season will dampen holiday sales and shift them to 2007, Kay predicted. However, "if they had no coupons, it would be worse," he noted.

Michael Gartenberg, an analyst with Jupiter Research, believes that the program could persuade some of those who have hesitated to buy. "If you're sitting on the fence in terms of buying a computer, it may be that push you need to get over the fact that Vista is coming," Gartenberg said.

Getting the upgrade
While those who buy a big-name PC will handle the upgrade through the computer maker, those who buy from smaller PC makers--known as system builders--will get their software update directly from Microsoft.

In the U.S. version of the system builder program, owners of Windows XP Professional or Tablet PC Edition can upgrade to Windows Vista Business for the cost of shipping and handling. Similarly, Windows XP Media Center can move to Windows Vista Home Premium, again for the cost of shipping and handling.

Windows XP Home users can move to Vista Home basic for about $50 or to Vista Home Premium for $79, plus shipping and handling. That's about half the cost of the standard upgrade price in both cases.

As for the big-name PC makers, Hewlett-Packard said that it will offer free upgrades to XP buyers, though shipping and handling charges may apply. XP Home users can move to Vista Home Basic, Media Center Edition customers can move to Home Premium, and XP Pro buyers can move to Vista Business, again at no charge beyond the shipping and handling charge, HP said.

Dell's program is roughly similar, though the company is charging $45 plus shipping and handling for XP Home users to move to Vista Home Basic.

The direct seller is hoping that the Vista transition will give it a chance to stand out more from its retail brethren by moving quickly to offer both the upgrade offer and, once it ships, to quickly load Vista onto new machines.

"People have questioned the strength of the direct model," said Dell spokesman Bob Kaufman. "This is a key indicator of how strong it is and how unique it is."

The coupon program looks quite complex, analysts said. "But Microsoft seems to think it will work for consumers because they will see just one offer," Kay said. "In general, I think it is problematic, and the fact that Microsoft put some cost in it at all is going to be an inhibitor."

In essence, a coupon allows buyers of a PC with Windows XP to get some form of protection on the cost of the operating system, Cherry said. The complexities of the program won't help, he said. "It doesn't make sense to make this harder than it has to be, if the goal is to get people to purchase a computer now and feel comfortable," he said.

Microsoft has been widely expected to a coupon program allowing holiday season PC buyers to upgrade to Vista. The software maker declined to say how it would account for the program, noting that it is scheduled to release quarterly earnings on Thursday. It is likely to give more details then on the financial impact of the upgrade program.

Kevin Johnson, co-president of Microsoft's Windows unit, told CNET News.com in May that the company was likely to offer some sort of technology guarantee.

"There's likely to be something, and they're working on specifics now," he said.

See more CNET content tagged:
PC company, buyer, Microsoft Office, upgrade, Microsoft Office 2007


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Add your comment
VISTA OEM Upgrades and Support
Microsoft's current practice is to charge $35 for each support call if your PC's genuine copy of Windows XP was loaded by an OEM manufacturer or even a 'Mom-and-Pop" PC retailer. People who bought direct from DELL, HP, Gateway, etc., probably can get first tier support for free from these firms. If you bought from "Big Box" home electronics stores or the "Mom-and-Pop" and the store loaded your copy of Windows you do not have the same option.

The so-called upgrade for PCs bought prior to the release of VISTA could put customers in the same situation. If your Windows XP serial number has the string OEM in it, you most likely will be charged for support. If Microsoft wants better market penetration it might consider a different paradigm for support calls than the one we have now.
Posted by djysrv1 (2 comments )
Reply Link Flag
What's the alternative?
Like what? Paying for every call?
Posted by Ryo Hazuki (378 comments )
Link Flag
Who the heck buys a PC?
With parts and options being cheaper, why the heck
<a class="jive-link-external" href="http://www.teckmagazine.com/content/view/422/43/" target="_newWindow">http://www.teckmagazine.com/content/view/422/43/</a>
would anyone buy a PC from a store when you can build it faster than they can ship it to you?
Build you own PC and flush these companies and their corporate nonsense out of your life.
Posted by cnutsucks (25 comments )
Link Flag
gee... Why wouldn't I buy HP?
I mean, really, if Vista is supposed to be a selling point, why wouldn't every manufacturer offer Vista upgrades for free? Why is it only HP? That doesn't make any sense. It's not like Dell is going to ship PCs with XP next year, so why wouldn't they all have the same deal this year?

Is MS giving HP preferential treatment or what?
Posted by solomonrex (112 comments )
Reply Link Flag
Preferential Treatment - NO....
Each PC builder chooses their options for Vista upgrades with MS. It's not preferential treatment by MS, but HP of their customers?
Posted by lonny paul (52 comments )
Link Flag
Don't need to
Other companies like Dell and Toshiba are doing exactly the same.
Posted by Ryo Hazuki (378 comments )
Link Flag
Why you ask?
Because that't typical Dell. I vowed to not give them any business when they fired their U.S. tech support people and went for tech support from India, instead.

But even before that, their customer sevice went downhill.

Dell is simply more stingy than HP.

I switched to a "System Builder" for my most recent PC purchase. But if I ever decided to consider one of the big-name makers, I'd go with HP.

I bought my Mom a new (replacement) computer for her Birthday. It's an HP. We've been very happy with it so far (14 months). I'm not surprised HP is providing Vista for free.
Posted by angrykeyboarder (136 comments )
Link Flag
OK that is useless...
It is useless. A upgrade coupon. Will is keep my data? Will the system work? Will Microsoft support me if something goes wrong? I have upgraded my Windows OS few times and never without problems.

I think this Christmas it is going to be Apple all around in my family. All the cool stuff of Vista and then some. Here, Now and proven track record on upgrades.
Posted by zoe000 (2 comments )
Reply Link Flag
OK you are ignorant...
Maybe it is. For someone like you. Yes, you can upgrade while keeping your data. It has as many chances of working as if you upgrade an Mac. If the upgrade goes wrong of course Microsoft or the PC vendor will give you support because you are entitled to. If you have upgraded your Windows OS few times and never without problems you must have done something wrong or you don't know what you're doing, I have done that too and never with problems. Good luck fixing flaws and vulnerabilities Apple states they don't exist, getting your favourite software to work in OSX and good luck too for the Random Sudden Shutdowns (<a class="jive-link-external" href="http://www.macbookrandomshutdown.com" target="_newWindow">http://www.macbookrandomshutdown.com</a>). I agree with the "all the cool stuff of Vista and then some": Vista won't have that Random Sudden Shutdowns special feature. Proven track record on upgrades? Good luck for when you want/have to upgrade your Mac hardware (buy another one).
Posted by Ryo Hazuki (378 comments )
Link Flag
Now I get it!
So HP offers the upgrade for free; Dell charges you $45. Now I get why HP crept pass Dell to become the #1 seller of computers globally.

If this is marketed correctly (and if the upgrade works well), then this is a very good idea. Not as good as getting Vista out in December, but good nonetheless. No other manufacturer has tried this before, right?
Posted by toosday (343 comments )
Reply Link Flag
How Stupid Is This? End users upgrading...
From XP to a whole new major operating system.
This is going to cause such a consumer backlash when "Mommy" goes to install Vista and gets to the point of having to install all new security software because her old AV won't work with the new OS and she is directly connected to the Internet with no router or firewall between.

Not withstanding the security implications there are going to be many many many systems that will wind up having to use their "restore" disk )if they provide one) and the user is going to be happy until they find out that all of their data went away with the restore.

There is going to be such a consumer backlash at both the system Manufacturers and Microsoft since they promised it would eventually be a Vista system only for the consumer to have either a spambot or a non-functioning system.

Please! Anybody that does not know Windows in and out do not take advantage of this offer as you will only be looking at grief and frustration only because Microsoft delayed their product.
Posted by fdunn3 (489 comments )
Reply Link Flag
Not at all.
Actually "mommy" is more secure with a Vista with no anti-virus software than with XP with anti-virus software (thanks to the changes in the network stack and blocked access to the core level of Windows in Vista) and she won't be connected to the Internet with no firewall because Vista has a 2-way firewall enabled by default. As long as users do things correctly and follow the instrcutions correctly there is no reason to be "many many many" systems that will wind up having to use their "restore" disk. If you think there will be a backslash on Microsoft than I think you are up to a very bad surprise (at leats for you) since they are offering people the chance to upgrade to a more secure, more reliable, better performance OS free of charge (depending on the manufacturer, that is). I am the one who says "please", don't fool people into staying with a much less secure OS just because you don't know how to upgrade one. Anybody that wants a computer should upgrade to Vista as soon as possible, mainly to avoid security problems for them and for others, as simple as that.
Posted by Ryo Hazuki (378 comments )
Link Flag
like a worm on a hook
Funny how this comes out right after the disgust people are
expressing about the new limits on transferring vista to new
systems. I can hear it from Redmond now ... "hmm, maybe people
won't notice that we've taken over their entire computer and
removed all rights they thought they had over their own equipment
if we promise to give them a deal."

Here fishy fishy fishy ....
Posted by Dalkorian (3000 comments )
Reply Link Flag
Like conspiracy theorist
Funny how if any company in the world (especially holy Apple) starts a campaign where they give something free of charge it obviously has to be something good for the consumer, as noone forces us to get into or follow that campaign, but if it's Microsoft, oh then it's a hook. Whoever takes advantage of this campaign isn't forced to use the upgrade and can install whatever OS one wants to on it, so there goes your conspiracy "hook" theory. Get a life...
Posted by Ryo Hazuki (378 comments )
Link Flag
like a worm on a hook
Funny how this comes out right after the disgust people are
expressing about the new limits on transferring vista to new
systems. I can hear it from Redmond now ... "hmm, maybe people
won't notice that we've taken over their entire computer and
removed all rights they thought they had over their own equipment
if we promise to give them a deal!"

Here fishy fishy fishy ....
Posted by Dalkorian (3000 comments )
Reply Link Flag
First I get a 404 error, then I get a double posting. Guess what I
had to say was more important than I thought ...

Sorry for the double post folks, business must be up on these
Posted by Dalkorian (3000 comments )
Link Flag
Can't wait to get it on my PC
I was about to order a new PC today from Systemax and found that they are offering these upgrades as well which are not mentioned in the article.

The full story can be found at <a class="jive-link-external" href="http://www.tigerdirectblog.com/2006/10/25/catalog-sneak-preview-free-vista-express-upgrades/" target="_newWindow">http://www.tigerdirectblog.com/2006/10/25/catalog-sneak-preview-free-vista-express-upgrades/</a>
Posted by lonny paul (52 comments )
Reply Link Flag
Ho Hum..
I don't even see any worthy reason to upgrade just yet.

Theres not even any appz. out for Vista.

But the CNET review of Vista is exactly what I had expected.
I wasn't all impressed with RC1, either. And as far as I've heard
there isn't even any difference between the two versions. From
the beginning I always thought it did a bad imitation of MAC OS
X with less features (not that theres anything wrong with that)
but it does have a DOS like kind of feel to it. I thought I was the
only one that noticed.

BUT.... it is more steady &#38; secure than XP and Aero is an
improvement over Luna. Sadly, the only two really good reasons
to upgrade.

But when I do end up buying it.

It'll be running on my Mac Pro alongside XP, Linux and OSX set
as my default of course. Thank God for BOOTCAMP!!
Posted by ServedUp (413 comments )
Reply Link Flag

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