Windows Vista (In)Capable Comes Into Focus

The Windows Vista Capable and Windows Vista Express upgrades have weighed heavily on the company's costs, but in Microsoft's perspective, the initiative was necessary and designed to address PC sales in the 2006 holiday season, in the absence of the operating system. Through the Windows Vista Capable and Express programs, the Redmond company offered a guarantee that a machine preloaded with Windows XP bought at the end of 2006 would be able to run Vista, or that the users will enjoy certain benefits following the consumer launch of the platform on January 30, 2007. The Microsoft Technology Guarantee programs were made available to consumers and small businesses starting with October 26, 2006, and ending on March 15, 2007.

At the end of January, Microsoft announced a deferral of $1.64 billion of revenue and operating income, on the quarter ended on December 31, 2006, due to the Technology Guarantee programs. But the company could dig even deeper in its pockets as the two programs have generated a class-action lawsuit. The initial lawsuit was introduced back in April and claimed that Microsoft had made use of deceptive practices in order to market and sell computers with the Windows Vista Capable and Windows Vista Express upgrade logos. Microsoft is accused of failing to present a discerning difference between the promise offered by the Vista Capable and Express upgrade logos and the reality of machines limited to just the Home Basic edition of the operating system.

"Microsoft, through its 'Windows Vista Capable' and 'Express Upgrade' programs, promoted the sales of computers with Microsoft XP installed on them on the pretense that they had the capability to run Microsoft's new Vista operating system, when in fact, they cannot run the 'real Vista' that provides the 'core Windows Vista experience.' ... Through its misleading acts, Microsoft benefited by selling more XP licenses and additional upgrades than it would have without the 'Windows Vista Capable' and 'Express Upgrade' programs," read the allegations presented by the filing on behalf of Dianne Kelley of Camano Island.

"Ms. Kelley does not allege that Microsoft's conduct deceived her into buying a PC that she would not otherwise have purchased, or that she received anything other than what she expected to receive -- a low-end PC with the 'Windows Vista Capable' sticker, which was in fact 'capable' of running Windows Vista Home Basic. She does not allege that the sticker played any part in her decision to purchase that PC, or that she had any expectation that she would be able to run something more than Windows Vista Home Basic," reads a fragment of Microsoft's motion for dismissal as cited by SeattlePI.

On August 7, U.S. District Judge Marsha Pechman gave green light to the class action lawsuit against Microsoft, for the Vista Capable and Express upgrade programs. Microsoft's position continues to be the fact that Vista Capable machines are in fact able to run Vista, even though only the Home Basic version.