Windows Upgrade Pricing: How Low Will It Go?

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Microsoft will offer its cheapest upgrade pricing yet, with upgrades to Windows 8 Pro available for just $40, through January 31, 2013.

Though the $40 upgrade price is temporary, the announcement made me wonder just how low Microsoft will go in upgrade pricing for future versions of Windows. For that matter, is the upgrade cycle for future versions of Windows on the brink of change?

Given the state of the competition, I wouldn't be surprised if the days of expensive, two- to three-year Windows upgrades are coming to an end.

With Windows 8, Microsoft is fighting a war on two fronts: It needs to prevent PC users from switching to Macs, and it needs Windows tablets to become worthwhile competitors to the iPad. On both fronts, Apple has been aggressive on software development, with annual updates for both iOS and Mac OS X.

A yearly cycle for major updates allows Apple to quickly respond to users' needs and add new features that help integrate both operating systems. Mountain Lion, for example, includes support for iMessages and Game Center, adds AirPlay mirroring on an Apple TV, and synchronizes iWork documents with iCloud. This fall, iOS 6 will bring Siri support to the iPad.

While iOS updates have always been free, OS X updates are getting cheaper. For anyone running OS X Snow Leopard or Lion, the upgrade to Mountain Lion costs just $20. If you're on the fence about purchasing a Mac or a PC, Apple is trying to lure you over to the Mac side by sending a message: You won't spend as much to keep your software up-to-date if you buy a Mac.

Windows 8 is a competitor to both the iPad and the Mac, so it's hard to imagine that Microsoft will continue its tradition of slower upgrade cycles. Windows Phone and the Xbox 360 already receive yearly updates, so Windows 8 is likely to follow as the platforms merge.

But how much will future Windows upgrades cost? Microsoft is, after all, still a software company that relies on Windows licensing for a big chunk of revenue. Unless Microsoft Surface crushes the competition and drives PC makers out of business (highly unlikely, at least for the foreseeable future), Microsoft will still need to charge for new versions of Windows. I doubt Microsoft will offer free upgrades anytime soon.

Still, I think (and hope) we'll see cheaper, more frequent updates in the future as Microsoft tries to keep pace with both OS X and iOS. Alternatively, Microsoft could offer meatier free updates at the mid-point of its OS cycle, instead of maintenance-minded Service Packs. All of this is speculation, of course, but I think the $40 Windows 8 upgrade signals big changes in the way Microsoft will develop and release new versions of its OS.

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