Free upgrade coupons are unlikely

Aug 19, 2006 08:29 GMT  ·  By

Based on Microsoft silence orbiting the issue of promotional Windows Vista coupons, Michael Silver, Research VP at Gartner, has addressed the problem from a reserved position. His perspective has catalyzed by reports of a promotion campaign involving Vista capable machines and the latest OS from Microsoft. The Redmond Company failed to comment on the news that Windows Vista free upgrade coupons will be made available concomitantly with the purchase of a PC capable of running the operating system. While the promotional is reported to debut in October 2006, Silver is more circumspect.

"PC hardware vendors and retailers are worried about holiday sales - users may decide to buy that plasma TV for Christmas, instead of buying a PC, because they know that, in a few weeks, new PCs will be shipping with Windows Vista preloaded. But those that start talking about a possible coupon deal now could be putting a damper on back-to-school sales, as buyers try to nurse their old PCs along, waiting for PCs that ship with coupons," wrote Silver on his blog.

The fact that Microsoft has never before embarked on a three months long free Windows upgrades program, conjugated with the company's past promotional strategies involving original equipment manufacturers, are indicators that Silver presents as arguments to contradict the free Vista upgrade coupons promotions.

"As time has passed, margins for OEMs have continued to shrink, making it more difficult for them to offer such programs. Including media costs, shipping and, most importantly, support (upgrading an OS is not a trivial task that can be successfully done by the average consumer), we estimate a cost to the OEM of at least $10 per PC shipped to supply and support an upgrade. If this cost is not partially underwritten by Microsoft, OEMs will find it difficult to offer it. Fee programs may be more likely," concluded Silver.