I suppose any reduction is good, but $10 isn't much for something purchased every few years (or simply bundled on an expensive new machine), especially when it comes from a company that could easily afford to give the OS away for free.
I don't know if this is true. Microsoft would have a very hard time keeping their revenue and profit where they are, much less growing them, which is what the street wants to see, if they gave away their OS.
If they suddenly lost their OS revenue the stock would take a dramatic hit, I doubt they could afford to do this.
Given that they can't afford the hit on their stock price that loosing their OS revenue would bring, can you show how they can afford this?
Windows isn't the only revenue that counts (e.g. people may not upgrade other software either, if they haven't upgraded Windows). And revenue isn't the only effect on long-term viability. They are no doubt spending a lot to maintain Windows right now. If they gave a free upgrade to Windows 7, they could pretend Vista doesn't exist and eliminate most of its support costs; simply tell all customers that Vista will not be supported because Windows 7 is free and is compatible.
[1] http://www.guardian.co.uk/business/2009/apr/23/microsoft-rev...
That sounds nice in theory. In practice there are many companies that change OS's very slowly as it cost alot of money and time to test internal apps and systems on each new OS.
I'd bet that even if Windows 7 was free there would be a substantial client base that would still stick with Vista, XP and 2000 because they don't want to have to upgrade thousands of computers.
Frankly the boxed OS prices for Windows are moot.
Individuals get the new OS license with the new computer and businesses go through resellers. 7 isn't any 'cheaper' than Vista for any significant number of Microsoft's customers.
Honest question though: How many people do you know who still build desktops? It seems everyone I know has gone laptop + external monitors in the past few years. (with hand-built 'server' machines all running linux)