Well, the prices for Windows 7 are here and this is how it fares out.
Is Windows 7 cheaper than Vista? YES (thank God). If Microsoft had priced this the same as the previous OS that would have been a seriously stupid maneuver.
Starting today, if you pre-order Windows 7 as an upgrade, the Home Premium Edition (which is what most people would go for) is just a tick under $50. See below.

The full versions start with Home Premium at $199.99. That’s still steep, but it is cheaper than Vista. See below.

What do you not get with Home Premium?
- XP Mode
- Domain Join feature
- Automatic backup
- BitLocker
- Thirty-five language choices
The only one you’d miss is the auto-backup feature, but there are several auto-backup solutions out there to cover that.
See a detailed comparison chart here.
What versions of Windows qualify you for the upgrade?
Windows Vista or Windows XP. Yes, XP qualifies be it Home or Pro Edition. Is says so right on the Office Depot sale page for this product.

A near-60% discount on the purchase of Home Premium means this is the cheapest Windows upgrade we’ve seen in a very long time.
I use Windows 7 RC on a daily basis. It’s stable and solid. And now, thankfully, cheap (at least for the upgrade).
This upgrade offer lasts from today, June 26 to July 11.
Where to get it?
The links go directly to the Windows 7 pre-order page for the respective vendor.
[UPDATE]
Several more vendors are now available including TigerDirect, BestBuy, NewEgg and more.

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