Over the past few years, I've felt like the lone voice in the wilderness trying to communicate that Windows Vista wasn't as horrible as people had heard. Indeed, for the first year of that OS's existence, Microsoft was largely mum, and it wasn't until the software giant fixed the few real problems with Vista in Service Pack 1 (see my review) that the company finally turned its attention to marketing the fact that, yes, Windows Vista was actually quite good, thank you very much. Efforts like the Mojave Project, the Seinfeld/Gates advertisements, and the "I'm a PC" ad campaign did a lot to overturn Vista's bad PR, and it now appears that Windows 7 will finally put all that nonsense to rest for good.

But if there was one criticism of Windows Vista that was valid all along, it was that Microsoft over-reached in its desire to milk its core OS for all it was worth: Vista shipped in a shocking 6 product editions (compared to 2 when XP was first released, and four by the end of its mainstream retail life). I was sharply critical of this decision because I felt it made upgrades too difficult for consumers: It was hard to figure out which version to buy and then the higher-end Vista versions were simply too expensive.

As Microsoft began touting prerelease versions of Windows 7, there was a lot of speculation about which product editions Microsoft would offer in this Windows version. Would the software giant simply replicate its Vista strategy and spam the market with a confusing mix of product editions? Would it have the gall to actually add more product editions to the mix and, as rumored, even ship a version specifically designed for netbooks? Or would it actually do the right thing, adhere to the publicly stated simplicity and clarity mantra of Windows 7 and release fewer Windows 7 product editions?

The cynical may disagree, but I am thrilled to reveal some good news for a change. Here's what's really happening with the various product editions Microsoft is making available for Windows 7.

The mile-high view

Unlike with Vista, where Microsoft crowded the market with too many mainstream product editions, Windows 7 will ship in just a handful of common-sense product editions. And also unlike with Vista, these product editions are all true supersets of each other, so there are no overlapping feature sets (which is good) and upgrades will be much simpler (which is even better).

"As we moved to Windows 7, we looked back on the key learnings we had with Windows Vista and the conversations we've had with partners and customers," Microsoft senior vice president Bill Veghte told me in a recent briefing. "Everyone was looking for simplicity and clarity. They don't want to compromise capabilities as they stepped up."

This was a problem with Windows Vista. For example, a customer that chose Windows Vista Business didn't get Media Center, a digital media application that was part of the Home Premium product. But business users enjoy digital media too, especially when travelling, and they told Microsoft that this division in the feature set didn't make sense.

"With over a billion customers, there are lots of niches to balance as you simplify as well," Veghte added. "So we've moved to what I call a Russian doll model. Every [product edition] increments, and doesn't take away features or capabilities from the other editions. They are true supersets of each other, and additive.

Breaking down the product editions

For this version of the OS, Microsoft and its PC maker partners will market just two mainstream product editions, Windows 7 Home Premium--the recommended choice for consumers--and Windows 7 Professional, which is aimed at enthusiasts and IT professionals. Then there will be a handful of other product editions, each aimed at specific markets.

The first is Windows 7 Enterprise, which, like its Vista-based successor, will be sold only to Microsoft's volume license business customers.

"At a macro level, there are a couple of niches that are important to us, and we are a global business after all, so there are certain market dynamics that we need to address," Veghte said. These niches will be addressed by OEM-only Windows 7 product editions, which is to say that these products will be sold only with new PCs. [In this version,] Home Basic will be a hardware-constrained version sold only in emerging markets. The second is Ultimate edition, which will essentially be a retail version of Windows 7 Enterprise this time around.

"We feel that this lineup offers a clear onramp for Windows 7," Veghte added, "making it easier than ever to find the right version for your needs."

Here's how the complete product line breaks down (where each product edition is a superset of the one before it.)

Windows 7 Starter

Market: Worldwide availability this time but with new PCs only
Key features: Enhanced taskbar, Jump Lists, Windows Media Player, Backup and Restore, Action Center, Device Stage, Play To, Fax and Scan, basic games
What's missing: Aero Glass, many Aero desktop enhancements, Windows Touch, Media Center, Live thumbnail previews, Home Group creation
Price: n/a (netbook/low-end PC bundles only)

This version will only be sold through PC makers to users, but unlike with Vista, it will be sold worldwide. This suggests that netbook makers will choose this version, even in the US. As with previous Windows Starter Edition products, it is limited in some ways: You don't get Windows 7's full mobility capabilities, for example, and can participate in but not create a Home Group. Also, there's no Aero Glass.

Windows 7 Home Premium

Market: Mainstream retail market
Key features: Aero Glass, Aero Background, Windows Touch, Home Group creation, Media Center, DVD playback and authoring, premium games, Mobility Center
What's missing: Domain join, Remote Desktop host, network-based backup, EFS, Offline Folders
Price: $199.99 Full version, $119.99 Upgrade version

The volume Windows 7 offering for consumers builds on Starter and includes Mobility Center, Aero Glass, advanced windows navigation features like Aero Snap and Aero Peek, and multi-touch, as well as the ability to both create and participate in Home Groups. Home Premium will be sold at retail and be included with new computers.

Windows 7 Professional

Market: Mainstream retail market
Key features: Domain join, Remote Desktop host, location aware printing, EFS, Mobility Center, Presentation Mode, Offline Folders
What's missing: BitLocker, BitLocker To Go, AppLocker, Direct Access, Branche Cache, MUI language packs, boot from VHD
Price: $299.99 Full version, $199.99 Upgrade version

This volume Windows 7 version builds on Home Premium and adds features like domain join, Group Policy (GP) controls, location aware printing, network backup, EFS, and offline folders. Pro will be sold at retail and be included with new computers.

Windows 7 Enterprise

Market: Volume-license business customers only
Key features: BitLocker, BitLocker To Go, AppLocker, Direct Access, Branche Cache, MUI language packs, boot from VHD
What's missing: Retail licensing
Price: n/a (Software Assurance/volume licensing only)

As before, Enterprise is aimed at Microsoft's Software Assurance (SA) volume license customers. This time, however, Enterprise is a superset of Professional and adds much-heralded Windows 7 features like Direct Access, Branch Cache, BitLocker, and BitLocker To Go. Aside from licensing differences, Windows 7 Enterprise is functionally identical to Windows 7 Ultimate and includes every single feature offered by Windows 7.

Windows 7 Ultimate

Market: Retail market, limited availability
Key features: BitLocker, BitLocker To Go, AppLocker, Direct Access, Branche Cache, MUI language packs, boot from VHD
What's missing: Volume licensing
Price: $319.99 Full version, $219.99 Upgrade version

For those few customers who simply must have everything, Windows 7 Ultimate offers all of the features from Enterprise but loses the volume licensing requirement. So you can think of Ultimate edition as Enterprise for consumers (and other retail customers).

Windows 7 Ultimate is kind of a wild-card. It will be available at retail and with new PCs, but Microsoft says that it will not be heavily marketed and will instead be "offer-based" via occasional promotions and offers from both PC makers and retailers.

"We're experimenting with the kinds of offers we can make for Windows 7 Ultimate," Veghte said. "It's going to be a low-single digit run rate (i.e. low market share) product. We expect retailers and OEMs to occasionally offer Ultimate with new PCs as part of special promotions. But in terms of run rate, it will be a tiny, tiny percentage of the volume. We will keep the marketing energy on Home Premium and Professional."

Is it really simpler?

So you may be looking back over this list and thinking, well, hold on a second there: That's five product editions. Is Microsoft really simplifying anything? Yes, they really are. Microsoft and its partners will focus most of their efforts selling Home Premium and Pro to the retail and consumer markets, and Enterprise to volume licensing business customers. That means that most consumers will simply have two choices when it comes to Windows 7: Home Premium and Pro. Just like with XP, when that OS first shipped.

Meanwhile, Ultimate and Starter are, by definition, niche products that are available only to address low-volume but important markets. But what really makes this work is the "Russian doll" structure where each version is a true superset of the one below it. This is a huge and important change.

But wait, there's more

I have some additional information to share today, especially around upgrading.

The secret Home Basic edition

In addition to the product editions listed above, there is technically another product edition, Windows 7 Home Basic, which Microsoft will make available only to emerging markets. So fear not, this version doesn't really muddy the waters too much. It lacks Aero Glass, Live Thumbnail Previews, Internet Connection Sharing, and a few other goodies, and rest assured that no one will ever be buying this version. The rest of the world can simply ignore Windows 7 Home Basic, though the existence of this version explains why Windows 7 Home Premium isn't simply called Windows 7 Home.

Hot 7-on-7 action: Electronic upgrades

Thanks to the Windows Anytime Upgrade functionality in Windows 7, users can electronically upgrade from any Windows 7 product edition to any higher-end product edition, and do so quickly and easily. So even a Starter edition user will be able to upgrade all the way up to Ultimate if they so choose. This feature is now completely automated and takes only ten minutes or so to accomplish. You don't need to worry about having an upgrade DVD handy, or wait for media to arrive in the mail.

[ Read more about Windows Anytime Upgrade in my exhaustive Feature Focus article. ]

Upgrading from Windows Vista

Windows Vista users will face the simplest upgrade choices: You can go from Vista Home Basic or Home Premium to Windows 7 Home Premium or any higher product edition, for example, and thanks to the common underpinnings, these types of upgrades can be performed in-place, with no loss of applications or data files. The upgrade process is a bit slow, especially compared to the speed of a clean install of the OS, but the results should be excellent. "We're going to make this as simple and clean as possible," Veghte said.

[ Learn how to upgrade from Windows Vista to Windows 7. ]

Upgrading from Windows XP

As for XP users, they can only "upgrade" by performing a clean install of Windows 7--Microsoft will not support an in-place upgrade--but there will be utilities to smooth the process and get data transferred over easily. It's not as straightforward as the Vista upgrade, but XP users will be able to migrate to Windows 7 on the same hardware without losing any valuable data.

[ Learn how to migrate from Windows XP to Windows 7. ]

32-bit to 64-bit?

As was the case with Windows Vista, Microsoft will not support in-place upgrading of any 32-bit Windows version to any 64-bit Windows 7 product edition. You will need to do a clean install instead.

Still to come...

Simplifying the Windows 7 product lineup is a very, very positive step and it goes a long way towards righting the wrongs of the Windows Vista product editions matrix. If you're truly cynical, you may look at the list of Windows 7 product editions and decry the fact that there's only one fewer version this time around than was the case with Windows Vista. But in truth, consumers will typically only need to choose between two different versions this time around. And that's a good thing. We're quick to criticize the software giant when it screws up, so we should be just as quick to praise them when they get it right. This time, they did get it right.