Microsoft hopes to cash in on netbook users

As you might recall, we learned last month that the cheapest Windows 7 flavor available worldwide will only support running three applications concurrently. According to Bloomberg, Microsoft will target that release at netbooks—even though cheap little laptops should have no trouble running higher-end editions of the operating system. What's the idea there?

Apparently, Microsoft will intentionally limit the basic netbook release in order to get consumers to "trade up" to full-featured editions, thus raising average selling prices. Microsoft's CFO makes no apologies for the strategy:

"The challenge for us clearly is to get the average selling price up," Microsoft Chief Financial Officer Chris Liddell said last week. "We see Windows 7 at as an opportunity. We'll have the ability for people to trade up, which would give us a price more similar to what we would normally get for a consumer."

Microsoft Consumer Product Management Director Parri Munsell told Bloomberg that upgrading from Windows 7 Starter to higher-priced editions will be easy, because "all the required software will already be installed on the machine and it just takes a few minutes to switch from one version to the next." That sounds like Microsoft could revive the online Windows Anytime Upgrade program it once offered to Vista users. (Thanks to DailyTech for the tip.)

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