Microsoft to Cut Price of Vista

Vista will be cheaper starting in March, as Microsoft plans to cut the price of certain versions from 20 percent to 48 percent.The reductions, to take effect at the same time as the scheduled late March release of Vista Service Pack 1, will apply to the Home Premium and Ultimate versions of the operating system, both in both full and upgrade editions. The price cuts will take effect in 70 countries; in the United States, the price of the Ultimate version will drop to $319 from the current $399. "We anticipate these changes will provide greater opportunities... to sell more stand-alone copies of Windows," said Brad Brooks, a Microsoft corporate vice president.

The key phrase there is "stand-alone." The price cuts apply only to the copies of Vista sold directly to consumers, not to the original equipment manufacturer (OEM) versions that come preinstalled on new computers. Since, according to Goldman Sachs, only 5 percent of Windows sales are through retail chains while 80 percent are via OEMs, it's not clear how many consumers will wind up benefiting from the reductions.BBC News, CNNMoney, CNET