In what may be an unprecedented decision, Microsoft said Thursday that it plans to lower the retail prices for several flavors of Windows Vista.
For those in the U.S., Microsoft is cutting prices only on the higher-end versions of Vista, and only for the upgrade version used to move from an earlier copy of Vista. The suggested price for Vista Ultimate drops to $219 from $299, while Home Premium falls to $129, from $159.
Other developed markets will also see price cuts, while in emerging markets, Microsoft is eliminating the distinction between full and upgrade versions of Home Basic and Home Premium as it attempts to convince more users there to use genuine software.
Analysts were surprised by Microsoft's move.
"I can't remember a big price cut like this," said analyst Chris Swenson, who tracks retail software sales for NPD Group. "It's very unheard of."
Microsoft finalized Windows Vista in late 2006, but held back its retail launch of the product until January 2007. It has sold more than 100 million copies, largely on the back of a strong overall PC market, but retail sales have significantly trailed those of XP in its early days and Vista has received a number of critical reviews.