I am not complaining. Just Curious. Why is the their price difference between

  • Thread starter Thread starter Greg P Rozelle
  • Start date Start date
G

Greg P Rozelle

I am not complaining. Just Curious.
Why is the their price difference between an Oem Version, Upgrade
Retail Version, Full Retail Version?

Also,
How can it cost Microsoft more money to make a Full Retail Version
than Oem version?

Thank You,

Greg P Rozelle


Disclaimer
My advice is as-is. It could trash your system.
 
Their are costs such as packaging, and volume discounts offered to OEM
customers. Upgrades are cheaper because the install requires a previous
version of windows, and offers you a discount for having one.
 
Why is the their price difference between an OEM Version, Upgrade
Retail Version, Full Retail Version?
Click to expand...

The upgrade is cheaper than the full version because you are required to
have a previous version of Windows to qualify for the upgrade licensing.
When you install using the upgrade license, the license for the older
version of Windows is then considered to be part of the new Windows
installation - in short, you lose the license to the older version of
Windows when you use it to qualify for an upgrade license.
How can it cost Microsoft more money to make a Full Retail Version
than OEM version?
Click to expand...

Aside from packaging and documentation, Microsoft has to support retail
versions of Windows. Support for OEM versions of Windows is done by the OEM
that sold you to OEM copy. Also, I don't believe that all OEM copies of
Windows are put on the holographic CDs (are any of them?). That would
definitely make the OEM CDs cheaper to produce.

--
Mike Kolitz MCSE 2000
MS-MVP - Windows Setup and Deployment

PATCH YOUR WINDOWS NT/2000/XP/2003 COMPUTERS!
http://www.microsoft.com/technet/security/bulletin/MS03-026.asp
 
Greg wrote
Mike,
Side Note-It would be interesting to know how much Microsoft.
makes per each copy of xp. Whether Retail, Upgrade or Oem.
But Microsoft would not say.
Click to expand...


Buy some stock and ask the company directly at a shareholders meeting.
 
Mike Kolitz said:
Aside from packaging and documentation, Microsoft has to support retail
versions of Windows. Support for OEM versions of Windows is done by the OEM
that sold you to OEM copy. Also, I don't believe that all OEM copies of
Windows are put on the holographic CDs (are any of them?). That would
definitely make the OEM CDs cheaper to produce.
Click to expand...

The generic OEM version sold by Microsoft to the smaller manufacturers
and assemblers are on the holographic CDs. Pricing of these is
comparable to the retail upgrade prices.

Larger OEMs actually produce their own CDs and for Windows XP these
are pretty much always "System Recovery" CDs which contain an image
file of the installed XP as it was at the factory.


Ron Martell Duncan B.C. Canada
--
Microsoft MVP
On-Line Help Computer Service
http://onlinehelp.bc.ca

"The reason computer chips are so small is computers don't eat much."
 
I am not complaining. Just Curious.
Why is the their price difference between an Oem Version, Upgrade
Retail Version, Full Retail Version?
Click to expand...

Difference between Upgrade and Full Install pricing is because with
the upgrade you are given credit for having the previous license.
That previous license is merged into the upgrade license and once it
has been used as part of an upgrade it cannot legitimately be used
separately on a different computer.

Also,
How can it cost Microsoft more money to make a Full Retail Version
than Oem version?
Click to expand...

Support. Plus a bit for manufacturing and packaging.

The two free support calls, if used, represents an average cost to
Microsoft of somewhere between $80 and $100 as I understand it. ($40
to $50 per call)


OEM versions are in shrink-wrap packages whereas retail versions come
in a full retail box. Also with the major OEMs they produce their
own CDs so there is almost zero direct cost to Microsoft. Just the
R&D costs (billions) plus administration and overheads (including
activation).


Ron Martell Duncan B.C. Canada
--
Microsoft MVP
On-Line Help Computer Service
http://onlinehelp.bc.ca

"The reason computer chips are so small is computers don't eat much."
 
| The two free support calls, if used, represents an average cost to
| Microsoft of somewhere between $80 and $100 as I understand it. ($40
| to $50 per call)

$40 to $50 per call when they probably average less than ten minutes each?
That's at least $250 per hour *cost* for each tech on duty. Multiply that by
the number of tech hours worked each year and you'll come up with some
astronomical numbers.

I'd like to see Microsoft's detailed justification for that on paper. They
can't charge off more than a fair pro rata amount of overall support costs to
the freebies since they're hauling in enough money on paid support to make
Croesus jealous.

Larc



§§§ - Please raise temperature of mail to reply by e-mail - §§§
 
from the said:
| The two free support calls, if used, represents an average cost to
| Microsoft of somewhere between $80 and $100 as I understand it. ($40
| to $50 per call)

$40 to $50 per call when they probably average less than ten minutes each?
That's at least $250 per hour *cost* for each tech on duty.
Click to expand...

Sounds about right to me (+/- factor of 2) - remember those techs need
equipping and training, housing, etc. Now if MS just move them =all= to
India ...
 
Greg said:
I am not complaining. Just Curious.
Why is the their price difference between an Oem Version, Upgrade
Retail Version, Full Retail Version?

Also,
How can it cost Microsoft more money to make a Full Retail Version
than Oem version?

Thank You,

Greg P Rozelle


Disclaimer
My advice is as-is. It could trash your system.
Click to expand...

Also, keep in mind that what a vendor choses to price their product is
sometimes (often) not related to the cost of production. Most vendors
will charge as much as the "market" offers.
 
I do know Vendors get discounts.
I also know that a computer here charges $60.00 an hour

Only Two Support Calls for a Full/Upgrade Version-That's Ridiculous.

However, This gives me an idea for a Longhorn Version.

This version will be a Full Version with no support offered,
if disk is damaged/defective it can be exchanged.


Greg P Rozelle
Also, keep in mind that what a vendor choses to price their product is
sometimes (often) not related to the cost of production. Most vendors
will charge as much as the "market" offers.
Click to expand...


Disclaimer
My advice is as-is. It could trash your system.
 
Greg said:
I am not complaining. Just Curious.
Why is the their price difference between an Oem Version, Upgrade
Retail Version, Full Retail Version?

Also,
How can it cost Microsoft more money to make a Full Retail Version
than Oem version?
Click to expand...


A major point is that OEM carries no charge on Microsoft for the cost of
providing support - even paid support. Which is quite a lot. And no
right to transfer on, so it may be seen as limited to the modest life of
one machine, whereas a retail one might well be spread over the life of
two

Difference between Upgrade and Full is more in the nature of a loyalty
discount on Upgrade - as is common in software.

In other words - commercial considerations, AKA what the market will
bear (or at least pricing to maximise total profit)
 
Ya, and that box's plastic casing is sealed so much you need a steak knife
to get into it!

--
Check out http://www.kellys-korner-xp.com for amazing tweaks and fixes

Member of "Newsgroups are for everyone"

5 Steps to computer safety:
1) Use a good quality anti-virus, and keep it up-to-date.
2) Use a firewall. The one in XP works fine, but there are better ones out
there.
3) Keep Windows up-to-date. It's your choice whether or not you want the
recommended updates, but the critical updates are just that - critical.
4) Beware of adware and spyware. There are many programs that will help to
protect your computer, but it's up to you to prevent it as well. Make sure
you read the agreement of the software before you install it. It should
tell you if it will be installing any additional programs.
5) Be cautious of attachments. Microsoft NEVER sends out attachments via
email. Always scan all attachments before opening them.

Email address is fake to prevent SPAM.
Real email address is pcyr2000 AT hotmail DOT com
Change the obvious to the obvious.
------------------
 
Larc said:
| The two free support calls, if used, represents an average cost to
| Microsoft of somewhere between $80 and $100 as I understand it. ($40
| to $50 per call)

$40 to $50 per call when they probably average less than ten minutes each?
That's at least $250 per hour *cost* for each tech on duty. Multiply that by
the number of tech hours worked each year and you'll come up with some
astronomical numbers.

I'd like to see Microsoft's detailed justification for that on paper. They
can't charge off more than a fair pro rata amount of overall support costs to
the freebies since they're hauling in enough money on paid support to make
Croesus jealous.
Click to expand...

I have it from the usual "reliable sources" that Microsoft looses
money on their paid support calls. Not a lot, but some.

While many calls are only 10 minutes, others can require an escalation
to advanced technical support and may eventually require several
people working for days in order to resolve the issue. It does not
take many of these calls to boost the average.

The general "rule of thumb" for direct service billing is that the
chargeout rate should equal 2.5 times the hourly wage of the employee
doing the work. Among the things to be covered include:
- unbillable time. Not every support person will spend every minute
of their working day on a paid support call. There will be some
unbilled time, if just for coffee and washroom breaks
- payroll overheads and benefits (employer's portion of medical,
workers comp, etc etc etc etc)
- paid absent time (annual vacation, official holidays)
- supervision and administration
- equipment and supplies (desk, computer, phone, paper)
- building and facilities (heat, light, taxes, cost of construction,
janitor)



Ron Martell Duncan B.C. Canada
--
Microsoft MVP
On-Line Help Computer Service
http://onlinehelp.bc.ca

"The reason computer chips are so small is computers don't eat much."
 
Back
Top