Microsoft Denies Profiting Directly From XP Downgrades

A Los Angeles woman last week filed a lawsuit against Microsoft seeking compensatory damages and class action status alleged that the software maker was reaping “tremendous profits” from Windows XP downgrades. But Microsoft denies that it profits from selling downgrades for its OS from 2001.

Microsoft has yet to officially comment on the lawsuit filed by Emma Alvarado, who bought a Lenovo PC and is upset by the $59.25 charge she had to pay to downgrade from Vista to XP, but company spokesman David Bowermaster wrote in an email, “Microsoft does not have a downgrade program. It does offer downgrade rights as part of some Windows Vista licenses, including Windows Vista Business purchased through the OEM channel.

“Microsoft does not charge or receive any additional royalty if a customer exercises those [downgrade] rights. Some customers may choose or need to obtain media or installation services from third parties to install the downgrade version.”

In other words, it seems that it Microsoft is absolving itself from accusations that it profits directly from XP downgrades. Of course, Microsoft still requires users to purchase a Windows Vista license, and one of the top-tier ones at that. Only Vista Business and Vista Ultimate licenses may downgrade to Windows XP Professional, which is a part of a complaint, which read, "Customers have been forced to purchase the most expensive version of [Windows XP] in order to 'downgrade' from the Windows Vista operating system."

Microsoft doesn’t offer downgrade options with the most popularly sold version of Windows Vista -- Home Premium. So, those who want to go with XP are immediately facing a more expensive version of Vista.

"Microsoft mandates that customers who want to downgrade to XP must purchase the license to Vista Business or Vista Ultimate," said Dell spokesman David Frink last December, in a ComputerWorld story. "[That's] typically about a $130 premium, though some retail outlets charge more."

Late last year, Dell tripled its Windows XP downgrade fee to $150, showing a further premium for the downgrade option.

Microsoft now plans to discontinue new licensing of Windows XP on July 31, 2009 (except for netbooks). With many expecting Windows 7 before the end of this year, it goes without saying that Microsoft would want to minimize the length of time it has to support three different generations of operating systems.