Seattle PC builder beats Microsoft with free Windows 7 upgrade offer

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Computerworld - A Seattle-area PC seller will offer free Windows 7 upgrades to customers who buy new Vista-powered machines starting next week, beating Microsoft Corp. and its biggest hardware partners to the punch by months.

Puget Sound Systems Inc., an Auburn, Wash.-based system builder that sells PCs nationally, will launch its own Windows 7 upgrade program next week, said Jon Bach, the company's president, today.

"This is completely independent of any Microsoft [upgrade] program for Windows 7," said Bach.

Beginning next week, Puget customers who purchase PCs that cost at least $1,000 and are equipped with the 64-bit edition of Windows Vista Ultimate will be eligible for a free upgrade later this year to the 64-bit version of Windows 7 Ultimate. During a Friday interview, however, Bach said Puget would consider also offering upgrades from Vista Home Premium to Windows 7 Home Premium.

"We're seeing more and more people who are hesitant to purchase a PC because they're hearing good things about Windows 7 and wonder whether they should wait three-fourths of a year before buying," said Bach, explaining why Puget is jumping into the upgrade offer. "We see this as an opportunity to do something exciting when there's not a whole lot of things happening in the business at the moment."

However, Puget requires that the customer return the system to its Washington facility for the upgrade. The company does that to make sure that the upgrades go smoothly. Buyers will be responsible for shipping costs both to and from Puget.

"This will cost us about $200 per system," Bach said. "That's about what our margins are, so this is something we're looking at as break-even. But it's a way for us to get some exposure."

The free upgrade offer is currently set to expire June 15, although Bach said that the date might change, depending on what Microsoft announces as Windows 7's release nears.

Bach selected the mid-June expiration of Puget's program because he expects Microsoft to kick off its own Vista-to-Windows 7 upgrade program near the end of June. "As soon as that [program begins], we would rather they foot the bill," said Bach.

According to the usually reliable TechARP.com Web site, Microsoft will offer free or discounted Windows 7 upgrades to users who buy Vista PCs after June 28, 2009.

Microsoft's Windows 7 program, which the company has not publicly named or even acknowledged, would be similar to 2006's Vista Express Upgrade; it provided free or discounted Vista upgrades to people who purchased PCs powered by Windows XP between Oct. 26, 2006, and March 15, 2007. Vista Express didn't go as smoothly as Microsoft would have liked, however, as customers blasted manufacturers such as Dell Inc. and Hewlett-Packard Co. when they had to wait months for their upgrade.

Puget will start upgrading Vista PCs to Windows 7 within 30 days of the latter's public launch, said Bach, and it will be taking machines on a first-come, first-serve basis. Depending on the volume of returned systems, turn-around time could stretch to as long as a week, he acknowledged.

Microsoft has not spelled out a ship date for Windows 7. After the Jan. 10 launch of the new operating system's public beta, it has been working on a "release candidate," which some have speculated will be available in early April.

More information about Puget's Windows 7 upgrade program can be found on the system builder's Web site.