Windows 2000’s Hefty Price

Microsoft recently released estimated pricing schedules for Windows 2000 (Win2K), and two points stick out. First, the desktop product line prices are high. Second, Microsoft released the pricing information before rolling out the product itself, something Microsoft has never done before. The implications of this latter fact are presently unclear. Win2K's simple price tag might turn out to be more than many users would have expected. Although the price increase is in line with Windows NT pricing, and therefore business as usual for NT Workstation users, the price of Win2K Professional (Win2K Pro) might be a shock to desktop and laptops users running Windows 9x. A stand-alone version of Win2K Pro will sell for a retail cost of $319. If you're upgrading from Windows 95 or 98, the product will cost you $219. Users who are upgrading from NT will pay $149. This pricing scheme is similar to previous NT pricing, but it's vastly more expensive than Win9x's pricing history. For example, Win98 costs about $180 for a full installation or $80 for the upgrade. Most industry pundits have come to the same conclusion: Microsoft is initially pushing Win2K Pro at businesses, not at-home consumers. These days, paying $219 for a desktop OS upgrade is pretty hefty; very few at-home consumers will be willing to pay that much for the upgrade. So far, the most interesting analysis has come from the folks at The Register. This IT news source points out that, if desktop distributors start bundling Win2K Pro with desktops and laptops, Microsoft will start making twice as much money as it had been per desktop OS, while still being able to claim that it hasn’t upped its prices because Win2K Pro pricing isn’t much more painful than NT workstation pricing. The pricing for Win2K Server is, of course, more complicated. The five-user license will cost $999; however, when you upgrade from NT or Novell NetWare, the price drops to $499. For a 10-user license, these prices are $1199 and $599, and for a 25-user license, these prices are $1799 and $899. With this pricing structure, Microsoft is aggressively undercutting its competitors’ prices. For example, upgrading from a 10-user license for an older version of NetWare to the latest version of NetWare costs about $1000. Alternatively, upgrading from the older version of NetWare to the 10-user license for Win2K Server will cost considerably less (about $600). Win2K Advanced Server (Win2K AS), the high-powered enterprise version, will cost $3999 (or $1999 for an upgrade) for a 25-user license.

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