NewEgg publishes Windows 7 OEM prices

NewEgg is out!! I pay 64$ in preorder for the Windows 7 Home Premium 32Bit Upgrade at FutureShop!!

Paul, what is being referred to as just "OEM" is in fact OEM System Builder packs. They are not the same. OEM's get master copies from Microsoft, while System Builders buy these ones. According to the EULA, an end-user can't buy these because they can't be the same as the builder. A system builder is designated as someone that buys these and preinstalls the software, but can't use it beyond the rights of being able to preinstall it for distribution to the end-user. The end-user is also someone that is considered to be outside of the control of the builder. System builders aren't allowed to use these packs themselves (they can only preinstall it and sell it on computers) - that's why Microsoft makes the Action Pack Subscription available to them. It's also much cheaper for them to license software via MAPS anyway.

Waethorn - MS doesn't hold anyone to the rules you are laying out here. I;m sure MS knows that the vast majority of Newegg's customers are enthusiast/hobbyists that build their own boxes. Anyone is free to buy and use the 3 packs on their own systems. We just don't expect support from MS (and frankly we don't need it either).

That paragraph isn't referring to upgrade media....read it again. The first part is: "Upgrading to Windows 7. Choose Upgrade to keep your files, settings, and programs from your current version of Windows, and if your current version of Windows can be upgraded. If your version of Windows can't be upgraded, you need to choose Custom." Just ask Paul. He's written about the problem a lot. A lot of unanswered questions as of yet.

Paul - please feel free to weigh in and settle this. Has anyone gotten a hold of upgrade media for testing yet? I have read MS closed the Vista Upgrade "double install" trick this time around. Can you confirm the bad news for us all?

No upgrade media yet. But I will ask again in the morning. It seems like we should know by now.

"Anyone is free to buy and use the 3 packs on their own systems." Sorry, but you're wrong. "MS doesn't hold anyone to the rules you are laying out here." It's in the SBLA, and yes they do consider it license violation. "I'm sure MS knows that the vast majority of Newegg's customers are enthusiast/hobbyists that build their own boxes" Yeah, and that's why Newegg has this line on their website... : "Use of this OEM System Builder Channel software is subject to the terms of the Microsoft OEM System Builder License. This software is intended for pre-installation on a new personal computer for resale."

I know so many people that have been buying OEM from Newegg for a long time now. No one cares. They used to tie that purchase with a motherboard or a motherboard and a case so it looked like you were getting a "new computer" but they dropped that long ago. Between this and the student purchase program MS knows this and just one of the ways they keep up their market share. Bill Gates even made a comment about Windows and Office being the most pirated software there was and many have speculated that Microsoft early on looked the other way because it made people use it more. I am not advocating piracy, but if you know a student or buy a OEM, or get a super deal through work because you company has some kind of SA agreement, then go for it.

Microsoft changed the packaging that OEM copies come in to allow places like Newegg to sell these copies to home builders without requiring a hardware purchase first. The packaging is now called "system builders pack" and as long as it remains unopened, it is not a violation of the license to sell to anyone because the packaging clearly states that the person who opens the package is the system builder and is responsible for all support of the OS. It was a strategic decision to provide a cheaper way for the technically inclined to purchase Windows at a lower cost so they won't pirate the software.

Wow.... ...they're actually asking a lot of, A LOT OF, money for a VISTA-SERVICE PACK. OSX Snow Leopard is available for virtually everyone for 29 dollars.

Please acknowledge 'virtually everyone' in my post before making a comment like that.

There is a lot of nonsense out there about OEM versions. The best thing I have read about it was from Ars Technica 'Microsoft licenses OEM software to "system builders," which the license defines as "an original equipment manufacturer, or an assembler, reassembler, or installer of software on computer systems" . You can install software on computers, right? When asked, Microsoft says that OEM software is not intended to be installed by end users. Off the record, Microsoft spokespeople have told me that the big concern in Redmond is for Joe Newbie. They don't want inexperienced users buying OEM software, but the fact of the matter is that anyone can buy OEM versions of Windows. Truth be told, Microsoft is not opposed to the practice. Rather, the company says that people who purchase OEM software will simply be expected to abide by the terms of the licensing agreements' http://arstechnica.com/hardware/news/2007/01/8730.ars

"They used to tie that purchase with a motherboard or a motherboard and a case so it looked like you were getting a "new computer" but they dropped that long ago." Now they require a system builder build a complete computer, preinstall the software using the OPK (except in the case of server software, but it still must be accompanied by a complete system), and distribute to someones possession that is beyond their control before it can be used. "The packs may be marked a certain way but the OEM keys are treated exactly the SAME as any other OEM key by the activation servers and will operate exactly the same. So for all intents and purposes they are simply a cheaper option than buying 3 separate OEM copies." Just that end-users aren't allowed to buy these and do the initial installation themselves. "Just to clarify OEM meaning that you can only purchase this software with hardware only??" Not just a piece of hardware. After XP SP2, and before Vista launched, they changed the SBLA to indicate that it must be sold with a fully functioning computer, and has to be preinstalled using the OPK in the case of any client software (that goes the same for OEM hardware bundles that accompany a computer, meaning Microsoft's hardware driver software and related applications also have to preinstalled). "OSX Snow Leopard is available for virtually everyone for 29 dollars." ...if you own Leopard. If you own Tiger, you have to buy the other. One way is legal, the other is not. " the company says that people who purchase OEM software will simply be expected to abide by the terms of the licensing agreements'" AHEM! And the license agreement states: "To distribute the Software or Hardware in this Pack, you must be a System Builder and accept this license. “System Builder” means an original equipment manufacturer, an assembler, a refurbisher, or a software pre-installer that sells the Customer System(s) to a third party. You accept this license when you open this Pack." "Software Preinstallation. i. For each unit of Software in the Pack, you must pre-install one copy of the Software on a Customer System prior to distribution. If the Software includes more than one language version, you must install only one language version. ii. For such pre-installation, you must use the OPK provided in the Pack or otherwise made available by us. You may use the information, tools and materials contained in the OPK solely to preinstall the Software in accordance with the OPK." "This preinstallation requirement does not apply to server Software. Instead, server Software may be distributed inside the Customer System package." "“Customer System” means a fully assembled computer system that includes a CPU, a motherboard, a power supply, an internally mounted NAND or revolving magnetic-based hard drive, and a case. For Server products, a hard drive and separate power supply are not required. A Customer System must meet the system requirements of the software as posted on http://www.microsoft.com and must be able to run the Software." "“Distribution” and “distribute” mean the point in time when a Customer System leaves your control." And the final bit which I highlighted important key words: "If you comply with the terms of this license, Microsoft grants you a limited license to distribute the Software or Hardware. Except as granted in this license, you may not ***use, run,*** copy, modify, display, distribute, repackage or reassemble the Software, Hardware, OPK or any part of them." http://oem.microsoft.com/public/sblicense/2008_sb_licenses/fy08_sb_licen... "They don't want inexperienced users buying OEM software, but the fact of the matter is that anyone can buy OEM versions of Windows." I also asked, and although Microsoft Legal does NOT in fact like distributors offering OEMSB software to the general public openly, they are more concerned with persuing counterfeit software on the market. Under the terms of use, it is not legal for an end-user to buy it, and if Microsoft Legal doesn't like it, you know that there's a reason. The price is discounted on OEMSB software to improve the computer industry by helping out computer manufacturers, but without the standard support channels provided by Microsoft. Just FYI: Newegg is NOT included on any lists of Microsoft Authorized Distributors, but the text on their site is correct - it is only for preinstallation by a system builder on a computer for resale.

Honestly, if Microsoft wanted the OEM version versions of Windows not to be sold in stores, MIcrosft could bring their legal hammer down on Newegg, Fry's, MicroCenter, and every other retailer. So far, they never have. I can tell you why and its not a big secret. Steve Ballmer and the Microsofties are greedy sons of bitches. They want the money. For them, a sale is a sale. No matter what Microsoft legalese they print, I think its pretty much Microsoft's speak for, "Psst, here's Windows but if it screws up, you're on your own." And for a lot of folks, they are fine with it. If it screws up, you either fix it, have a backup image or you reinstall. No biggie. It may be technically illegal but its Microsoft own fault for not using its legal power to control the distribution of its product. Honestly, I think they should allow the average joe to buy Windows as long as the sales person points out, "You've got no service calls." You the end user are completely on your own except for updates and service packs. I think for many of the power users, gamers, and enthusiasts crowd, this works great. When Microsoft starts recording who buys the OEM software, then it has legal teeth. I could easily have my brother open the software and install it, and technically I never opened or installed the software. So this part of the EULA has so many ways of getting around it. I just don't think its a big deal. Just have someone else do it and you're okay. Besides, Microsoft has to be joking if anyone is going to pay full price for Windows. Nobody has done that for years and would rather obtain the PC and Windows discount. Let me know when the Windows OEM police starts up then I'll be worried. Until then, game on!

"So you can sell to one sort of customer at a discount and screw John Q for every penny you can get. :-((" Please tell me that doesn't happen everywhere. Barnes and Noble has this preferred membership program, where you pay a monthly fee to get a 20%-40% discount on each book you purchase. If I'm not mistaken, this is the same concept.

This goes a long way to show the monopoly power that Microsoft still exhibits. One of the tenants of being a monopoly is the ability to price discriminate. In other words charge different groups of people different amounts of money for the same item, based on their willingness to pay. A monopolist reduces the consumer surplus through price discriminating by effectively charging more money to those who "value" their products more. Since it is not possible to negotiate with each individual, a company makes a bunch of categories to determine what someone will pay. The most common example is the old Airline trick of charging less for a ticket that had a Saturday night stay to determine who was a business traveller and who was traveling for personal reasons. This is what Microsoft is doing.

If you are a systems builder and support the people you sell machines to, OEM rules and pricing make a lot of sense. When you build custom systems as part of turn-key services as we do, OEM licensing and the partner channel devoted to certified builders is even more important. While no one does anything to constrain hobbyists, OEM versions of the software are not intended for them any more than TechNet, or MSDN versions are. There are rules and if of chooses to break them, that's their business - it doesn't make it right, or lawful and it doesn't really hurt our market. What does hurt our market are small shops that disc load VLK copies of XP onto cheap OEM systems that ship with down level versions of Vista Home Premium (most commonly). This practice infuriates me and really does hurt - I mean... how can we compete on price when others are stealing the software and don't have to factor properly licensed software into their businesses. We see this sort of crap all the time and it hurts the affected customers a lot - new license costs and labor to make it all legal again. The only thing I would ask in consideration, and of hobbyists is... yeah.. go ahead and use OEM copies if you like, just please don't rub our noses in it, or claim some kind of right to outrage over legal pricing... just do what you do and be quiet about it. Doing things legally has a lot of benefits - including not having to feel like you have to justify things.

@Iketchum and @Waethorn What proof do you have that an OEM is illegal? Judgements? Please cite precedents.

" I agree with subzerohitman and if you think any court would hold up the policy, I have a very nice bridge to sell you in London." The SBLA is a legal contract that you have to abide by in order to use the product, and then only for the means and rights to which that contract allows. You obviously know nothing about law. "In other words charge different groups of people different amounts of money for the same item, based on their willingness to pay." Except that OEM software doesn't include transfer rights and support, so as I said before, there is a dollar applied to that logic. Your argument wouldn't stand up in court because if it would, it would allow a precidence where every business would either require to offer employee discounts to customers, or to noone. "What does hurt our market are small shops that disc load VLK copies of XP onto cheap OEM systems that ship with down level versions of Vista Home Premium (most commonly)." Just to clarify for others, as a system builder, you can offer downgrade licensing only on business versions of Windows. Also, just FYI to any business purchasers out there: if you buy a cheap computer, say from Dell, and it includes Vista Home Basic (don't laugh - many Vostro's do), you can't buy a volume license agreement to upgrade it, because Microsoft only allows business versions of OS's to be upgraded via a volume license agreement.....Also, volume license agreements ONLY include upgrades. Only retail and OEM[SB] licenses are full licenses. Hobbyists are best served with retail packaging though, because they can perpetually use the full license on new hardware, and just have to buy upgrades (which cost the same as OEMSB). OEM licensing doesn't offer them that option. There are many writeups about this on Microsoft's OEM System Builder site, but it's not a public site.

"Volume discounts, loyalty and rewards programs, incentives for new buyers, or repeat buyers, product differentiation... these are all examples of open market selling technique." Which, I might add, is not exclusive to the computer industry.

@ Waethorn No judgements, no precedents, just a lot of self-interested opinion.

lketchum - Go back and retake economics 101. This is as clear of a case of price discrimination as any. Sure, other companies do it, but you have to have some sort of monopoly power to do so. Multiple pricing for the SAME PRODUCT is price discrimination. How many different prices are there for Windows 7 Home Premium? 4 people can walk into the same store any buy Windows 7 Home Premium and each one would pay a different price. That is price discrimination, plain and simple. No market is ever naturally segmented. The segments are created by the companies who sell the products in order to reduce the consumer surplus and increase profits. I'm not saying this is bad or wrong, but it does show the power Microsoft has.

Devastating news this mourning. The king of the Wall Street oligarchs: Goldman Sachs issued a public statement essentially turning pessimistic on Microsoft Corp. Google - I mean Bing for more.

http://is.gd/3QBpj and http://is.gd/3QBsc

shark47, I would not know. I regularly disparage OSX on Apple blogs. I use what works for very specific needs.