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Acer: Vista is an excuse for Microsoft price increases

Vista is tailored to increase license revenues by introducing a basic edition no user will want, PC maker says.

Microsoft is raising the price of its software as it prepares to launch Vista, according to one of the leading PC manufacturers, Acer.

According to Jim Wong, senior corporate vice president of the Taiwan-based company, the issue is simply that the basic home edition of Vista, Home Basic, which is available for preorder on for 154.99 pounds ($293), is so basic that users will be forced to move to Vista Home Premium, at 189.99 pounds ($359). A Home Edition of Windows XP is currently available for 165.99 pounds, but has a recommended retail price of 176.99 pounds.

"The new (Vista) experience you hear of, if you get Basic, you won't feel it at all," Wong told PC Pro magazine. "There's no (Aero) graphics, no Media Center, no remote control."

Wong also said that the manufacturer's license for Vista Home Premium is 10 percent more expensive than for XP Home. "We have to pay more but users are not going to pay more," Wong said. This would mean an increase in the cost to PC manufacturers of 1 percent to 2 percent, according to Wong, in a business where the profit margin is around 5 percent or less.

At the top of the Vista lineup is the Ultimate Edition, which can be preordered for 325 pounds ($614) and, again, is significantly more expensive than the XP operating system it replaces. Windows XP Professional with Service Pack 2 has a recommended retail price of 289.99 pounds ($550), but is currently available for 234 pounds ($444).

Colin Barker of ZDNet UK reported from London.