Microsoft Sets Pricing for Vista Variants

Microsoft Corp. (MSFT) announced on Tuesday U.S. prices for Windows Vista, the long-awaited new version of the operating system that sits on more than 90 percent of the world's personal computers.

Microsoft, the world's biggest software maker, also reconfirmed its plan to target a general launch of the product in January after making it available to large-volume business customers in November.

The software maker set the retail price for Vista at between $100 and $259 for users upgrading from older versions of Windows. The prices range from the basic version of Vista to the top-end "ultimate" edition.

For consumers looking to buy Vista without an upgrade, the products will cost between $199 to $399, Microsoft said.

Windows Vista, already five years in the making, has been postponed by Microsoft several times.

"Signs are good. Signs are positive in terms of our schedule, but we're always going to be vigilant about the feedback we get," said Shanen Boettcher, Microsoft's director of Windows product management.

Microsoft released on Friday a test version of Windows, dubbed Release Candidate 1, and made it available to more than 5 million customers worldwide.

Goldman Sachs (GS) analyst Rick Sherlund said the initial feedback on the test version of Vista is encouraging.

"While substantial progress has been made with Vista, the timing is still iffy in our view and feedback over the next few weeks will be critical," said Sherlund in a note to clients.

Boettcher said the company also plans to have a program in place, possibly using coupons or rebates, to allow consumers to upgrade to Vista at a discount if they buy a PC before the new operating system's release.

He declined to offer any specific details.

Microsoft has said it expects the Windows Vista Home Premium to be the mainstream product with more entertainment options, allowing users to record and watch high-definition television, burn and author DVDs and perform other multimedia functions.

The Home Premium edition, which will be sold as an upgrade for $159, is seen as a middle option for consumers, sandwiched between the Ultimate version with business-oriented functions and a bare-bones Basic edition that comes without some of the system's flashy new interface features.

Shares of Microsoft fell 8 cents to $25.76 on the Nasdaq.