Microsoft Bill For 'Vista Capable' Put At $8.52 Billion

the ongoing "Vista Capable" class-action lawsuit

University of Washington economist Keith Leffler estimates that it would cost Microsoft between $3.92 billion and $8.52 billion to upgrade notebook and desktop PCs that the company labeled "Vista Capable" but which were not able to run the full version of the Windows Vista operating system, Computerworld's Gregg Keizer reported Thursday.

The software giant disputes that figure as "absurdly" valued in a court filing that along with Leffler's report was unsealed by U.S. District Court Judge Marsha Pechman Wednesday.

Microsoft launched Windows Vista in January, 2007 following a nine-month marketing campaign with components manufacturers, computer makers and retailers. During that period, Microsoft and its partners placed "Vista Capable" labels on notebooks and desktops that while able to run the entry-level Home Basic edition of Vista, in many cases could not run more advanced versions of the operating system.

Plaintiffs in the lawsuit, which is set for trial in April, say that because Vista Home Basic does not include features like the Aero Glass graphic user interface present on more advanced versions, the operating system shouldn't have been called Vista in the first place. And because the "Vista Capable"-stickered computers they bought didn't have the hardware necessary to move to versions which had those supposedly Vista-defining features, like Vista Home Premium or Vista Business, the plaintiffs say they were defrauded.

The "Vista Capable" labeling campaign began on April 1, 2006. Leffler estimates that 19.4 million PCs -- 13.75 million notebooks and 5.65 million desktops -- were labeled "Vista Capable," according to the unsealed report.

Leffler came up with his total upgrade costs by calculating how much it would cost to upgrade each of the 19.4 million PCs with 1 GB of memory and graphics cards or onboard chipsets able to run Aero, according to Keizer. Leffler put the maximum cost of upgrading the desktops at $155, while positing that the notebooks' integrated graphics would be more tricky to replace and would cost between $245 and $590 per unit. The total price tag for Microsoft would thus range from $3.92 billion to $8.52 billion and in some cases would include complete replacements of notebooks that could not be feasibly upgraded, Leffler testified.

Microsoft in its response argued that giving litigants "a free upgrade to Premium-ready PCs would provide a windfall to millions."