Demand Still Strong For Vista-XP Downgrades

"Downgrade rights are our most popular OS selection. I'd estimate that at least 75 percent of Vista licenses are going to XP," said Joe Toste, vice president of marketing at Equus Computer Systems, a Minneapolis-based system builder.

With downgrade rights, Microsoft gives customers that buy PCs with Vista Business or Vista Ultimate the option of rolling back to XP Professional. Many Microsoft channel partners have been offering downgrades to Vista customers as a value-added service, and system builders have until January 31, 2009 to sell PCs with XP pre-installed.

Microsoft in June 2007 gave its Gold Certified OEM partners the ability to perform Vista downgrades online through an automated process. But after January 31, non-Gold Certified system builders who want to offer XP to customers will have to endure a time-consuming slog through a downgrade process that involves phone calls to Microsoft and validation of PCs on a one-by-one basis.

A Microsoft representative contacted by ChannelWeb declined to comment on whether non-Gold Certified OEM partners will be able to offer automated Vista downgrades. But one system builder told ChannelWeb that Microsoft reps recently told him he'll have to follow a 10-step downgrade process, and manually downgrade PCs from Vista to XP.

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"There is no way for us to do this in bulk. So, if a customer orders 200 desktops with Vista Business, and wants to downgrade them to XP Pro, we have to go through this with each individual system," said Andrew Kretzer, director of sales and marketing at Bold Data Technology, a Fremont, Calif.-based system builder.

Although downgrade rights are part of the Vista EULA and have no expiration date, Microsoft is currently scheduled to stop providing the media for downgrades to OEMs on July 31, 2009. The Microsoft spokesperson said customers will still be able to access their downgrade rights after that date by contacting Microsoft, but didn't specify how that process would work.

"That's one of the most bizarre things I've ever heard," said one system builder, who asked not to be named. "Can you imagine the kind of resources Microsoft would have to allocate to handling downgrade rights phone calls? It doesn't seem like that would make sense for them financially."

There has been some industry speculation that Microsoft is on track to ship Vista's successor, Windows 7, in mid-2009, although Microsoft's official stance is that it'll arrive in late 2009 or early 2010. With many organizations having decided to skip Vista and wait for Windows 7, a mid-2009 Windows 7 launch would give Microsoft a way to shift industry attention away from Vista as well as the downgrade rights issue.