What buying Vista Ultimate means to Microsoft

What buying Vista Ultimate means to Microsoft

Summary: Microsoft's plan to sell multiple versions of Vista--Basic, Home Premium and Ultimate--may already be paying dividends. The company, which reported fiscal second quarter earnings and provided plenty of items to analyze, said last night that it expects premium versions of Vista to represent 60 percent of sales in fiscal year 2007 (SeekingAlpha transcript).

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TOPICS: Windows
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Microsoft's plan to sell multiple versions of Vista--Basic, Home Premium and Ultimate--may already be paying dividends.

The company, which reported fiscal second quarter earnings and provided plenty of items to analyze, said last night that it expects premium versions of Vista to represent 60 percent of sales in fiscal year 2007 (SeekingAlpha transcript). That projection is above the 54 percent premium mix expected by Friedman Billings Ramsey analyst David Hilal.

So what does it mean to Microsoft if you buy Vista Ultimate instead of Basic?

Hilal estimates that for every 1 percent Microsoft increases the sales mix toward Vista Ultimate (say going from 1 percent of the total Vista sales to 2 percent) the company gets another $150 million in revenue for its client division. If you buy more Home Premium and the mix increases 1 percent it represents an additional $50 million in revenue for Microsoft.

Aside from the fun with numbers, it'll be interesting to see what flavor of Vista people choose. Hilal notes:

"We believe that Ultimate could do better than our 1 percent OEM license mix expectation, as consumers that use their home PCs for both entertainment and business purposes will be attracted to the breadth of functions that Ultimate offers."  

[poll id=46] 

Topic: Windows

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46 comments
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  • Why isn't Business on the poll? (NT)

    .
    3D0G
    • Missing an option

      None! Should be an option in the poll.
      I. Kidya Knott
    • Better yet, Other?

      and maybe Mac OS X
      I was going for Ultimate, but i decided not to vote.
      Graham Fluet
  • Why cann't I choose not to buy?

    Why is there no option on the poll on "Not buying Vista"?

    I thought journalists are usually advised not to trust vendor supplied figures as they are always in favour of themselves? ;)
    sinleeh9
    • Yes, Why no choice not to buy?

      Yes.... All us Mac OSX users who don't want Vista... Or those of us who will stick with XP and don't want to worry about Vista's Memory hog of a system...
      Alkora
      • Ummm don't forget us Linux Users...

        ]:)
        Linux User 147560
        • Silly, folks...

          ...why would you worry about the content of a poll asking about which version of Windows you will buy when you aren't gonna buy any of them?

          Anything to get your John Henry on the boards, eh?

          Have a good weekend...
          GuyAlanDye
          • They are buying it

            That's the point. If it come with a PC you purchase then you have bought. The OS isn't free it's built into the price. It really amazes how if you bundle something into on price people think they are getting something free.

            It's like IE everyone thinks it's free but the price is paid as part of buying Windows.
            voska
          • Now I need a smoke

            I always enjoy a smoke afterwards, should have had a NO option to select from.
            John Henry
            MaxOnTheEdge
    • Not the question?

      That wasn't the question. The question is apparently, "For those buying Vista, what one do you want?"

      If you don't want it, I guess you'll have to find a poll that asks: "What will you buy?"
      John Zern
    • Why Not Have A Button

      Why not a have a button for
      I'm a Mac/Linux Fanboy and I want to remind people that we are still here
      Blogsworth
    • I Agree

      As an analyst, a decision is ALWAYS allowed for NO action as well as actionable points.

      When making a choice over acquisition, not buying is always a valid option.

      I currently have 5 computers and one is running Windows 98 with no hope of loading this pig.

      So ... what do I do? Do I take out a site license and a second mortgage?

      Then there will be the expenses for drivers ... when I went from Windows 2000 to XP, I had to pay an additional ?20 for a disk of drivers from HP for my 'All-In-One'.

      If I purchase a new computer and it comes loaded, I may just strip it off and load a copy of XP too.

      To tell you the truth,, I'd like to see Microsoft actually create a product and stick with it until it works.
      The Smoking Man
      • Oy... Geeze..

        [b]Then there will be the expenses for drivers ... when I went from Windows 2000 to XP, I had to pay an additional ?20 for a disk of drivers from HP for my 'All-In-One'.[/b]

        What? You couldn't download the drivers from the web?

        [b]If I purchase a new computer and it comes loaded, I may just strip it off and load a copy of XP too.

        To tell you the truth,, I'd like to see Microsoft actually create a product and stick with it until it works.[/b]

        Braindead comment dude... XP's been around for what? 6 YEARS. If it didn't work, no one would be using it. Obviously, it's been working for those who've been using the product for all these years. However, it's time for something NEW.
        Wolfie2K3
    • No Compelling Reason To Buy

      I see no compelling reason to upgrade. Vista seems to be just a warmed over Windows XP. All the interesting stuff was pulled out to get this version out the door.
      chessmen
  • Why isn't Cowboy Neal in the poll? (NT)

    nt
    none none
  • Ultimate

    I am already using Windows Vista Ultimate and Office 20097 Ultimate.

    However it cost me nothing, so i am buying none of the above but using Ultimate. Thank you microsoft Technet PLUS!
    usrhlp
    • 20097 Ultimate?

      Thank you for that update, H.G. Wells.
      dave.leigh9
  • The correct answer is "NONE"

    nt
    dave.leigh9
  • Interesting Story, But Ultimately Useless

    I have to say that I have never based my purchase decisions on what the profit margin of the software company who is supplying it to me. What this story does is to incite the hatred against M$ by the Apple guys (eventhough Apple posts higher margins per product).
    Ultimately this story is useless because it doesn't take into account other costs of marketing the "Ultimate" name or ongoing costs of supplying new versions.
    What M$ is doing is using the Apple model and raising the price of a new product not on the basis of cost increase but in response to a demand of customers that want a media centric OS. It is a marketing ploy, so in essance M$ is proving that Apple's model of marketing before technology is a better strategy.
    weepule
    • Marketing Before Technology

      I agree with part of what you're saying: Microsoft is obviously trying to blunt the effect of a a price hike by offering numerous stripped-down versions.

      I don't agree, though, that Apple uses a "marketing before technology" model. Apple (at least in the OS arena) genuinely [i]is[/i] ahead of the curve in a lot of respects. That's not just hype. (And this is coming from someone who'll probably never actually own a Mac, so I'm not some "fanboy".)

      If you want to talk about iPods, now there I agree with you. Apple has forsaken technology for marketing, in that case. Not only was the iPod years behind the curve in assimilating video, but it [i]still[/i] doesn't offer recording or an FM tuner. An iPod is basically a fashion accessory, and not a technology product.
      bhartman36