Are the British getting Windows 7 at a discount?

Today, a number of sources are reporting that Microsoft will sell Windows 7 at a dramatic discount in the United Kingdom. Those sources point to pre-order pricing as evidence: folks in Britain can buy the full version of Windows 7 Home Premium for only £64.98—roughly $106. By contrast, Win7 Home Premium will set you back $199.99 in the States, and the upgrade version is $119.99.

What gives? There are several factors at play here. First of all, Amazon may actually be selling licenses for Windows 7 Home Premium E, which was supposed to lack Internet Explorer and not allow in-place upgrades (so a clean install would be the only option). Microsoft announced two months ago that E editions of Windows 7 would be sold "at upgrade prices" in Europe. That would already explain most of the discount.

Now, we reported a couple of weeks ago that Microsoft decided to scrap these editions, opting instead to sell regular editions—upgrade and full, just like in North America—with Internet Explorer and browser ballot screens. European customers who pre-order the discounted E versions should get full versions without having to pay the difference, which might explain why Amazon UK claims to be selling a full version of Windows 7 Home Premium. Unless Microsoft changes its mind, though, prices should go up across Europe before too long.

But wait a minute; Amazon sells Win7 Home Premium E in France for €117.81, which works out to $166. Are UK consumers getting a special rate compared to their mainland European counterparts?

Yes and no. The financial crisis has caused the value of the pound to drop against that of the euro, so prices now tend to be comparatively lower in Britain. The British government has also cut its value-added tax from 17.5% to 15% in an effort to spur consumption. Shopping for, say, Office 2007 shows a similar disparity between British and French pricing—$526 versus $648, respectively.

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