What the Windows 7 Pro sales lifecycle changes mean to consumers and business buyers

What the Windows 7 Pro sales lifecycle changes mean to consumers and business buyers

Summary: Under Microsoft's traditional sales lifecycle, Windows 7 PCs would have disappeared from the marketplace later this year. But Windows 7 Pro has been granted an extension. What does that mean if you're in the market for a Windows 7 PC?

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TOPICS: Windows, Microsoft, PCs
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Microsoft’s business model for Windows has historically been complex, with a mix of different editions, a partner-centric sales channel, and Byzantine licensing rules. Throw in a 10-year support lifecycle aimed at long-term business use and you have the perfect recipe for bumpy transitions between Windows versions.

That’s the backstory behind today’s announcement that Windows 7 Pro will remain available for sale on new PCs for at least a year longer than what historically would have been its end-of-sales date.

Businesses have voted with their pocketbooks: Windows 7 Pro is the long-term support edition, especially well suited to traditional PC form factors; Windows 8 and beyond will predominate in consumer channels, especially on smaller, touch-enabled devices intended for mobile use.

This shouldn’t be a surprise to anyone. I predicted this would happen in 2011, a year before Windows 8 was released:

Live long and prosper, Windows 7

[H]istory suggests that Windows 7 will continue to dominate the business segment for years after Windows 8 is released. To understand why, you have to look at how Microsoft's enterprise customers make technology adoption decisions.

[…]

If you have tens or hundreds of thousands of users, deploying a new OS is an expensive and complicated proposition, and it isn't done without extensive preparation.

Over the past two years, businesses that use Windows as their primary desktop OS have been testing, remediating, piloting, and deploying Windows 7. There's a certain urgency to that process, as extended support for the widely used Windows XP is due to end in April 2014.

Will those same businesses then turn around and begin planning deployments of Windows 8? Highly unlikely, given the sales and support lifecycle for Windows 7. In fact, Microsoft encourages its business customers to take a long-term view with this sort of deployment, offering a full 10 years of extended support for business editions of Windows.

And that's exactly what's happened, with the extra kickers of a slowdown in PC sales, a boom in tablets like the iPad, and a pushback among traditional PC buyers against the dramatic changes in the Windows 8 user experience.

Enterprise deployments are essentially immune from the Microsoft sales lifecycle. In big organizations, IT departments buy Volume License editions of Windows that give them the freedom to deploy a consistent image of whatever Windows version they’ve chosen as their corporate standard.

Today’s announcements make it easier for small and medium-size businesses to get some of that flexibility. By the end of this year, new consumer PCs with Windows 7 will become increasingly difficult to find. But business PCs with Windows 7 preinstalled will continue to be sold for at least another year, and probably well beyond that.

In this post, I’ve got answers to questions that consumers and business buyers are likely to have about the change.

Why is Microsoft doing this?

It’s all about the average selling price of Windows desktop licenses sold with new PCs.

Historically, Microsoft has offered a broad range of Windows editions at different price points. Consumer editions cost less; business editions cost more. By cutting off sales of Windows 7 Home Basic and Home Premium, Microsoft shifts the price mix upward.

With Windows 8 and 8.1, Microsoft simplified the mix even more, cutting its lineup down to just two: a standard edition and a Pro edition. Read through Microsoft’s financial reports for the past year and you’ll see that the company has managed to keep Windows revenues stable in a declining PC market by increasing the percentage of Pro copies sold.

How long will I be able to buy a retail copy of Windows 7?

windows7-pro-box-shot

Microsoft stopped offering shrink-wrapped retail copies of Windows 7 to resellers effective October 30, 2013, but the channel has enough retail copies of full licenses and upgrades to last for a long, long time. How long? Well, Microsoft ended retail sales of Windows XP on June 30, 2008, and yet you can find legal, shrink-wrapped copies of those products from resellers even today, with minimal searching.

Does this affect the end-of-life dates for Windows 7 support?

No. The sales lifecycle is a totally separate set of dates from the support lifecycle.

Extending the sales lifecycle for Windows 7 Pro does not affect the support milestones for Windows 7. You can find the full details for all versions of Windows and Office here: When will Microsoft pull the plug on your version of Windows or Office? For Windows 7, the support dates are the same as they’ve ever been.

Windows 7 RTM support ended in April 2009. For Windows 7 with Service Pack 1, Mainstream support ends January 13, 2015; the Extended support period ends on January 14, 2020, after which no security updates will be made available.

When will sales of Windows 7 consumer PCs end?

OEMs like Dell and HP have already made it difficult to find PCs running Windows 7 Home Premium. In fact, when HP introduced three Windows 7 desktop PCs last month alongside its 33 Windows 8.x machines, it was treated as headline news.

Even today, Dell is offering Windows 7 Home Premium as an option on some machines, but you'll pay a $50 premium to replace the standard Windows 8.1.

Under Microsoft's rules for its royalty OEMs, those machines can no longer be offered for sale after October 31, 2014. If you want to buy a new PC with Windows 7 preinstalled, you'll have to go to the business side of the store and buy a PC with the pricier Windows 7 Pro preinstalled.

What about Windows 7 PCs that are already in the sales channel?

OEMs can continue to build new PCs with consumer versions of Windows 7 up until the deadline of October 31, 2014, and stockpile them or ship them to retailers and distributors. Those PCs will continue to be available for sale as long as they’re in stock. In practice, that means the stock will shrink over time but you will still be able to find them for months or years after the end-of-sales date.

Can my neighborhood PC seller still build me a Windows 7 PC?

Yes, so-called System Builders can install Windows 7 on new PCs and resell them as long as they use a sealed copy of Windows 7 OEM software. Microsoft will continue to make OEM copies of Windows 7 Pro available for resellers on the same timetable as large OEMs. System Builders will be able to buy consumer OEM versions of Windows 7 (Home Basic, Home Premium, and Ultimate) from any reseller who has it in inventory.

How do today’s changes affect downgrade rights?

These changes make it possible for PC manufacturers to continue to offer new PCs with Windows 7 Pro preinstalled until at least October 31, 2015, with a reasonable likelihood of the actual end-of-sales date being extended even further.

The changes have no effect on downgrade rights, which allow you to buy a new PC with an OEM license for a business edition of Windows and then install an earlier version. In order to take advantage of downgrade rights today, you must purchase a new PC with an OEM license for Windows 8 or 8.1 Pro (PDF). That license includes the following provision:

Can I downgrade the software? Instead of using the Windows 8.1 Pro software, you may use one of the following earlier versions: Windows 7 Professional or Windows Vista Business.

This agreement applies to your use of the earlier versions. If the earlier version includes different components, any terms for those components in the agreement that come with the earlier version apply to your use of such components. Neither the manufacturer or installer, nor Microsoft, is obligated to supply earlier versions to you. You must obtain the earlier version separately. At any time, you may replace an earlier version with Windows 8.1 Pro. To enable downgrade on this computer to Windows 7, you must change the settings to boot into legacy BIOS mode. If the BIOS setting is not changed back to native UEFI mode boot prior to installing Windows 8.1 Pro, Windows 8.1 Pro will install; however, the following Windows 8.1 Pro functionalities will not work as they rely on UEFI mode boot:

  • Secure Boot,
  • Seamless Boot experience,
  • Network unlock for Bitlocker for computers with a Trusted Platform Module (TPM), and
  • eDrive support.

The easiest way to exercise downgrade rights is to buy a new PC with the downgraded version installed by the OEM. That configuration means you have full support from the OEM for Windows 7 Pro. The PC you buy includes media for Windows 8.1 and the right to upgrade to that version (also with support from the OEM) at any time.

Those PCs are widely available for sale today, as I noted last month (see Where can you still find a PC running Windows 7?) Most of those models are sold with a Windows 8 Pro license and Windows 7 installed as a downgrade.

Here, for example, is how Dell is selling its business-class Optiplex PCs today.

dell-windows7-downgrade-with-8

If Microsoft had followed its normal sales lifecycle, Dell would have had to pull Windows 7 Pro PCs from its online store at the end of October. But sales of PCs with Windows 7 Pro installed via downgrade rights can continue as long as current license agreements permit them. 

What if my organization has a Volume License edition of Windows?

Volume Licenses for Windows clients include the right to downgrade to any prior version of Windows. This right is considerably more generous than the normal OEM downgrade rights, which restrict you to only the two previous versions of Windows. The installation media for exercising downgrade rights are available from Microsoft’s Volume Licensing Service Center.

What PCs should my business be buying?

That's an easy answer. As I argued, successfully, in ZDNet's recent debate, Windows 7 PCs are a dead end for business. Instead, you should be buying PCs that support Windows 8 and using downgrade rights to maintain your Windows 7 deployment:

[W]hen you buy a PC designed for Windows 8, you get two huge security benefits: Secure Boot with UEFI and pervasive encryption on all devices that meet the InstantGo standard, even if they’re running a consumer version of the OS.

Windows 7 is a perfectly good enterprise OS for the present. But when buying new PCs, you need to plan for the future. That’s why Windows 8 PCs, with downgrade rights to Windows 7, are the perfect compromise.

There will be a natural temptation to save a few dollars by picking up older PC designs from the clearance shelf. If you do that, you're setting yourself up for disappointment later.

Topics: Windows, Microsoft, PCs

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31 comments
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  • Consumers? It will mean NOTHING.

    Business Buyers? It will mean little to the largest enterprises - who are already planning to accommodate Windows 8 in their hardware lifecycles.

    Small to medium business will not even think about it. They will go about their merry way under 2020, then they will panic.

    "Mom-and-pops" will keep on going to Wal-Mart and buying whatever is on the shelf (which will be Windows 8 systems).
    M Wagner
    • Small to medium business will not even think about it...

      Pretty much.
      In 2019 they might buy new PC/hybrids running the new Windows 10.
      SlimSam
  • And It Has Nothing To Do With The Fact That

    Windows 8 SUCKS on a desktop?

    Maybe that was too charitable. Windows 8 sucks worse that Windows Vista did on the desktop.

    I'm not so sure that the issue for business is the every-other-major-release cycle, or if it's because every other major release isn't worth spending a moment on:

    95 - good
    98 - meh
    ME - meh meh
    XP - good
    Vista - sucks
    7 - good
    8 - sucks

    If 8 wasn't so awful, and yes, mainly the tile interface makes it unusable, and it had something impressive to offer, upgrades would happen. However, it is awful to work with, and it doesn't have anything to offer, so upgrades won't happen.
    m0o0o0o0o
    • Windows 8 is amazing on the desktop...

      Since, you know, its desktop is quite a bit better than 7's.

      Try using 8 before you bash it.

      If you did, you'd know that most desktop users would be using, well, the desktop.

      To them, the start menu should an application launcher, nothing more, nothing less.

      Why would you be spending all of your time in the Metro UI?

      Calling an operating system unusable just because of a tiny aspect of it is just plain stupid.

      That's like calling the successor to your car unusable because its doors have slightly different handles.
      ForeverCookie
      • I've tried 8..so have my clients

        That's why my clients either have me build them Windows 7 desktops or if they buy a * desktop/laptop/whatever they immediately call me to either find a replacement so they can return it or they pay me to rip 8 off the thing and "restore it to usability" with Windows 7. That wrote I've heard more than once form more than one client.
        Hescominsoon
        • People on the internet can claim anything.

          ForeverCookie
        • The gramma next door is not a client

          Stop stealing her monthly checks and leave her computer as it is.
          A Gray
        • my clients have been calling non stop to upgrade them to windows 8

          so ive been busy.
          DontUseGoogleAtAll
    • Not at all

      Windows 8.1 is very good for desktop users. Windows 8 had some issues but most were fixed for 8.1 and update 1 will bring even more to the party.

      I'm using Windows 8.1 every day for work and the only time I see the Start Screen is when I need to start an application which I didn't pin to the taskbar or don't have a desktop shortcut which is about once a day, no more.

      The rest of the time I'm in the desktop and working just like I did in Windows 7 before, and even a bit faster, Windows 8.1 is very speedy even compared to Windows 7.

      I originally thought that I would miss the Aero glass interface, but in fact I quite like the Windows 8 theme for the desktop, it kept the thumbnail preview and window snap from Aero and that is the main thing.
      lepoete73
      • You Used Server 2012 ?

        First thing I do is stamp all over Metro.
        Alan Smithie
    • Windows 8.1 desktop user here...

      ... I gotta say, I can't agree with your post. Windows 8.1 is amazing on the desktop, and allows me to work undaunted. It allows me to snap Metro apps, while working in the desktop. I love having the Metro app Tweetium open and snapped along with a few other Metro apps that I switch between, along side the desktop. You should try it sometime.
      The one and only, Cylon Centurion
      • Say what?

        My God! People actually USE those crappy "apps" instead of ignoring the worthless trash!? Who knew?
        Simon Delancey
        • hmph..

          he clearly only does 3 or 4 things... facebook, twitter, browsing and a bit of word... :/
          comnut2k
  • you should be buying PCs that support Windows 8 and using downgrade rights

    PC doctor, it hurts when I think about what my business should do about our PCs.

    Advice: Take 2 Windows licenses and don't call me in the morning?

    With advice like that we will likely see a huge increase in Windows alternatives like Chromebooks or Linux running Windows apps virtually as thin clients.
    WhoRUKiddin
  • There is hope with Windows-9. Maybe?

    Non touch-centric content consumer users can only hope that Microsoft realizes their huge mistake with the built-in Windows-8 UI and fixes it with Windows-9. Why Microsoft decided on a radically new UI and not give buyers a choice of UI to use remains a mystery. One UI for two totally different user interactive methods makes no sense.
    TsarNikky
    • I disagree, and personally, I don't want Metro to go away.

      I use vanilla Windows 8.1 each day as my daily driver, and have found that the blend between Metro and the desktop is easy to work with. I love being able to snap Metro apps beside the desktop as I work.

      Besides, rumor has it that Windows 9 will offer nothing more than "Metro 2.0". Microsoft would be foolish to kill Metro off the desktop. And, personally, would be upset if they did. The desktop tile is only a click away, and can be set to boot to. Microsoft is giving you the choice of UI, however, you refuse to see it.
      The one and only, Cylon Centurion
      • You really may be

        the one and only...
        chrome_slinky@...
      • personally, I don't want Metro to go away.

        I don't think you or even Microsoft gets to make that decision...
        Metro is only viable while apps exist and are updated...
        For that to happen, there needs to be developers who can make money creating, maintaining those apps...
        And for that to happen, there needs to be a huge user base that WANTS Metro apps... and like the Metro UI...
        That doesn't seem to be the case.... If MS relegates the Metro UI to the background in the next updates/version of win8 then even less users will bother with it, in turn, less developers will embrace Metro and it will fade away....
        Chimera Obscura
  • Windows * isn't that great. Secure boot doesn't stop malware...

    My clients are running windows 7 until 2020. Most of my clients really don't need windows as they run 100% in the cloud. a couple are nearly there,. Once they get comfy using a browser for everything it's no more windows and Linux only. Their software costs drop to nearly nothing and their hardware cycles are now 7-12 years instead of 3-7 years.
    Hescominsoon
    • Not everything runs in a browser

      unless you're a dilettante that probably should never have had a real computing device in the first place...this is why phones, tablets, and chromebooks are doing so well - because many people never needed a real computer anyway.

      At the turn of the century, had WebTV been a little better, there would be far fewer computers sold in the last decade, and no one would be squawking quite so much about the loss of revenue in computers - it was a temporary thing that has now become unnecessary for many.
      chrome_slinky@...