I read this PressPass article this morning from Microsoft.  Apparently Microsoft plans to reduce the prices on several versions of retail editions of Vista with the launch of SP1.

"Since its release, Windows Vista  has seen solid sales through the first year of availability, primarily through the sale of new PCs. Stand-alone retail sales, while not representing a large percentage of the business, represents an area of opportunity for additional growth the company sees based on the new editions introduced in 2007. To help reach that goal, Microsoft today announced price reductions on several consumer stand-alone editions."

However, as Mary Jo Foley put it, "don't get too excited about those Vista price cuts".

Adrian Kingsley-Hughes posted some information he has about the actual price cuts.

• The price of the upgrade version of Windows Vista Ultimate will drop from $259 to $219.

• The upgrade of Vista Home Premium will drop from $159 from $129.

There doesn't appear (at this time) any information about the full retail version of Home Premium, which seems to be the choice of many consumers.  When I buy a Windows operating system, I want the full version not an upgrade, but that is just my personal choice.  Vista's price point is one of the biggest faults of Vista, and we can only hope Microsoft has learned their lesson with this.

Microsoft needs to take all this into consideration when the next version of Windows is ready.  Forget all the different SKU's that most people have no clue about the differences of.  Make one version, price it reasonably, and get it out there.  Also, give consumers a family pack of 3 or so licenses for a discounted price.  There is no value for me to upgrade all the PC's in my house to Vista.

It will be interesting to see how this develops.