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Windows Vista Capable stickers might have been a Microsoft cash cow
  • 7 Comments
by Matt Burns on January 4, 2009

windowsvistacapableDeep inside a dimly lit Microsoft boardroom a few years ago, several overpaid marketing tools came up with the term ‘Vista Capable.” This moniker was to be affixed to new computers ahead of Vista’s highly publicized launch. That way consumers could feel warm and fuzzy knowing that their new computer will be able to upgrade to glorious Vista down the road and it will run honky dory. We all know how that turned out. But didja know that Microsoft might have banked over $1.5 billion because of those little stickers?

Microsoft is currently in court over the dubious claim and that’s where this tantalizing detail was revealed. According to expert, Keith Leffler, 

I have been asked by Plaintiffs’ counsel to estimate the amount of revenue earned by Microsoft from the licensing of Windows XP on Vista Capable but not Vista Premium Ready PCs sold to Plaintiffs. In Microsoft’s Supplemental Responses it estimates that it received revenue of [redacted] from Windows XP licenses on upgradeable PCs sold in the U.S. during the April 2006 through January 2007 period. From the estimates of Windows Capable but not Vista Premium Ready PCs compared to all upgradeable PCs as in Table 1, I estimate that [redacted] of the [redacted] from Windows XP licenses on upgradable PCs were for XP licenses on Vista Capable but not Vista Premium Ready PCs — those PCs purchased by the Plaintiff class. From these figures, I have, therefore reached the opinion that Microsoft revenue from the Windows XP licensing on Vista Capable but not Vista Premium Ready PCs sold to Plaintiffs was $1.505 billion.

Makes you wonder just how bad Microsoft wants Windows 7 to succeed. Enough that everyone will forget about Vista. Windows ME was quickly forgotten after XP launched so it can be done.

Comments rss icon

  • “Designed for Windows Vista, but please, use Windows 7.”

  • I just don’t understand what all the fuss is about. I have had no troubles at all with Vista on 4-5 Ps, been using it since Beta 2 days.

    • Bob, the thing was that they mislead some of us to believe that subpar hardware was actually good enough to run Vista properly.

      I know that’s not the case for you, but you might know that if you pair a good cpu with an older chipset or insufficient memory or a small bus… well that’s what happened to us

  • Vista works fine for me too - January 4th, 2009 at 11:27 pm GMT+5

    same here Bob e…

    I have been using Vista for over 2+ years and NO ISSUES whatsoever…

    Apple is to be blamed for its NEGATIVE MArketing…!

  • I am skipping Vista completely and going to Windows 7 64bit the moment it’s out… software upgrades alone make it a worthy successor considering the tech that will come along with the computer running this OS.

    Jon
    http://WoodMarvels.com – Create Unique Memories

  • I don’t have a whole lot of love for MS but when you think about all the bad press that was being strewn about regarding Vista’s compatibility, before it was even released, it was a smart move to try to quell the ignorant panic experienced by every Johnny-Bag-O-Donuts who glances at the daily tech column on the splash page of their favorite search engine. Sure they probably made a few million bucks off of it in the process but so did every third party manufacturer who jumped on the sticker bandwagon a couple weeks later. I think it was just preemptive damage control that ended up paying a dividend.

  • The fuss is about possible collusion and alleged intent to defraud the public

    First “Vista Capable” computers CAN run all versions of Vista, but only partially. They are unable to use the Aero interface or to access a number of premium features such as the Desktop Window Manager, live thumbnails, “transparency” or 3D graphics. It is Aero and the new features that were so highly touted by Microsoft in its advertising – yet Microsoft and hardware manufacturers failed to make it clear that users with “Vista Capable” machines would have to do without them. User confusion about the differences between Vista “Capable” and “Premium Ready” computers (made worse by the original single designation “Vista Ready”) is part of the reason for the current class action lawsuit against Microsoft.

    Second, the hardware requirements for “Vista Premium Ready” – particularly the video specifications – are significantly greater than for previous versions of Windows, so much so that the majority of home and business systems do not have the graphics capabilities needed to run anything higher than Vista Basic. While Microsoft originally stated, “nearly all PCs on the market today will run Windows Vista”, by the time it was released, the UK, for example, estimated that only 5% of PCs in England would be able to take advantage of Vista’s premium features. Even executives at Microsoft complained about the hardware requirements in internal e-mails and memos, which are coming to light as evidence in the class action. Microsoft Vice President Mike Nash, noting that his laptop did not have an appropriate graphics chip, wrote that this left Vista so crippled, “I now have a $2100 e-mail machine.”

    Third, and this is increasingly a major weapon in the class action: Microsoft initially classified computers as “Vista Ready” based on whether or not they had a chipset that could support the Windows Vista Display Driver Model (WDDM), and thus display the Aero interface and take advantage of the newer features. Microsoft put together the “Vista Ready” program requirements based on the Intel 945 as the exemplar of the baseline chipset needed for designation as “Vista Ready.”

    However, it came to light last in early 2008 that Microsoft essentially created the separate “Vista Capable” classification because of pressure from Intel, a decision criticized and denounced by numerous executives at Microsoft, including the head of the Vista development team, who was taken by surprise by the decision, and who wrote in an internal e-mail, “We really botched this. I was not involved in the decision making process…” From the beginning the Vista team had understood and operated on the principle that Vista included Aero and the other new features. There was no such thing as a non-Aero version, no such thing as Vista Basic.

    There are hundreds of articles available in reputable print and web publications and newspapers with all the details of the deal, but it boils down to this: Intel was afraid it wouldn’t have enough laptops with 945 chipsets on the market in time for Vista’s launch (then anticipated to be mid-2006). They also had a significant percentage of systems on the market with their lower end 915 chipset, and were afraid those would become essentially un-sellable, since they could not qualify for Vista Ready classification.

    In the end, Intel persuaded MS to lower the Vista requirements so Intel could put Vista stickers on their 915 systems. The result? A two-tiered program promoting both “Vista Capable” (lower system requirements) and “Vista Ready” (the original, unchanged system requirements), so confusing that even Microsoft consistently gave out incorrect information about Vista Capable system requirements. som Vista Capable systems turned out to be able to run Aero. Some Vista Ready systems failed. Eventually Microsoft added the “Vista Premium Ready” designation to denote a system that was guaranteed to run the full VIsta OS and all the features.

    By then, unfortunately, hardware manufacturers – both Intel and non-Intel Inside – had jumped on the bandwagon, promoting even marginal systems as “Vista Capable,” glossing over the fact that a Vista Capable system would not support the very features users were excited about.

    Many at Microsoft were furious that Vista had been degraded, and that Microsoft would agree to put a Vista sticker on systems incapable of running anything but a stripped-down version. The internal communication coming out in court also indicates how angry and appalled much of Microsoft management was about bowing to pressure from Intel. General manager John Kalkman wrote in one e-mail, “In the end we lowered the requirement to help Intel make their quarterly earning so they could continue to sell motherboards with 915 graphics embedded.”

    So “what all the fuss is about,” to answer the writer above, is this: If there was collusion between Microsoft and Intel to lower Vista specifications in order to increase Intel’s potential sales, both companies are potentially looking at worse than a class action. They, and any individuals who approved the deal, might be facing criminal charges, and certainly further civil prosecution. If Microsoft’s decision was also based on its own potential increased profits – particularly if actual revenue estimates come to light – their legal position will become even more tenuous.

    Alleged false advertising and defrauding the public do tend to cause a bit of a “fuss,” especially when not millions, but billions of dollars are involved.

    Happy New Year to all, Cheers,
    cordwainer

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