How to sell Windows 7 to the average consumer

There's (understandably) been a lot of talk about Windows 7 pricing lately, and yesterday's reveal of a "Family Pack" clause unearthed by blogger Kristan Kenney ramped up the discussion even more. ZD Net's Ed Bott speculates that the family pack will cost $189, while Computerworld speculates a range from $74 to $136.

I'm trying to fit all these numbers together, and to do that I'm going to work with Bott's higher figure. First question, does $189 refer to a Family Pack of full versions, or upgrades? We know that as of now a single full version of Windows 7 Home Premium will sell for $199, so on the face of it that $189 must refer to upgrade versions. At the same time, early adopters can pre-order 3 upgrades for $150. By the time Windows 7 launches that deal will be long gone though, so perhaps the half-price upgrades don't factor into the pricing logic.

I have to wonder how many average consumers are going to upgrade to Windows 7 (if you're reading this post, you probably don't belong in the 'average consumer' category) even at $189 for three upgrades. To the average consumer, 'upgrade' sounds tricky. They wonder if they have to have a Windows Vista CD (most don't, since most bought a PC with Windows pre-installed and no installation media). They aren't sure how the upgrade system works or if they qualify. After all, they don't have a piece of paper that says they own Windows. They decide that it might be safer to just wait until they buy their next PC in a few years.

But what if Microsoft juggled the pricing around a bit? What if they dropped the cost of a full version of Windows 7 Home Premium to $129.00, with a Family Pack of three full version licenses going for Bott's $189.00 figure. The cost of a single-user upgrade drops to $69, so everyone who pre-ordered still has saved some money and can't complain too loudly.

I think consumers would feel a lot more comfortable buying a 'full' license of Windows 7 that doesn't depend on them having to have some other intangible 'thing' that they can't really identify, and these prices make it affordable for a lot more people than the current $199 price. For the vast majority of PC users, the upgrade is totally optional since they already have Windows running in some form. But they've heard the positive buzz about Windows 7, and they think that they should probably get it, for reasons they can't really articulate. Microsoft has to reach out to them in some way, to coax them into taking the plunge. Letting everyone affordably own (finally!) a boxed version of Windows 7 would be a win for both Microsoft and end users.

What do you think? Would a lower price make a difference, or are average consumers just not going to care no matter what? And would Microsoft even consider such low prices? Please leave a comment and let me know what you think.

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