Those free Windows 10 upgrades are over. Now what?

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  1. Spider

    Spider Super Moderator Staff Member

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    We've reached the end of Microsoft's unprecedented free upgrade offer for Windows 10. If you choose to upgrade an old Windows PC, you'll now have to pay. But good news: Those annoying GWX notifications are finally gone. [Updated]

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    By Ed Bott for The Ed Bott Report | July 30, 2016 -- 16:07 GMT (09:07 PDT)

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    The Get Windows 10 upgrade nags have officially ended

    [This article has been significantly revised and updated since its original publication in January 2016. The most recent update was July 30, 2016]

    Microsoft's ambitious plan to get Windows 10 running on a billion devices within the next few years depends to a large extent on the success of its free upgrade offer.

    When the company first announced the terms of that offer in May 2015, it literally included an asterisk and fine print. Those terms changed slightly over the intervening months, but one element has remained constant: the offer is good for one year after the availability of Windows 10.

    When they said "Offer ends July 29, 2016," they weren't kidding, either.

    If you click the Get Windows 10 icon today, you see a stark message: "Sorry, the free upgrade offer has ended."

    Here's the tl;dr version of this post if you don't want to keep reading:

    1. The free upgrade offer ended on July 29 and will not be extended.

    2. Any upgrades completed before that date will be valid for as long as the device lasts.

    3. There is a possibility that Microsoft will introduce some new upgrade offers this fall, but don't count on it.

    Anyone who has taken Microsoft up on its free Windows 10 upgrade offer before the expiration date has a "digital entitlement" (or "digital license" as it's called beginning with version 1607) tied to that hardware. That upgrade doesn't expire.

    If you haven't completed the upgrade and activated the installation, you're out of luck.

    Earlier this week, Microsoft told my colleague Mary Jo Foley that the Get Windows 10 (GWX) notifications will end. They added, "In time, we will remove the application."

    My morning-after testing confirms those details. If you decided to pass on the free Windows 10 upgrade, the GWX app remains installed, but based on my experience and the above statements it should no longer appear in the taskbar and its notifications appear to have been silenced.

    The Windows 10 download page, which is useful for anyone who needs the Windows 10 installation files to do a recovery or a clean install on a machine that already has a Windows 10 license, is still up. But the Upgrade Now button is gone, replaced by a notice that the free upgrade offer has ended.

    In fact, Microsoft's real goal with this upgrade offer isn't just to get its installed Windows 10 base to a billion. The long-term goal is to help close the books on Windows 7 in an orderly fashion before its 10-year extended support commitment ends on January 14, 2020.

    Some of those Windows 7 PCs will simply be retired, of course. But what about those that are only a few years old and have more than four years of usable life ahead of them? For Microsoft executives, the prospect that hundreds of millions of PCs will still be running Windows 7 on New Year's Day 2020 has to bring back unpleasant flashbacks of Windows XP's messy end.

    After 11 months, Microsoft said a total of 350 million monthly active devices were running Windows 10. (In its most recent earnings release, CEO Satya Nadella committed to "regularly reporting the growth of Windows 10 monthly active devices.")

    The shift to using monthly active devices as a metric is a big change for Microsoft, which previously reported on the number of licenses sold. In the first 18 months after releasing Windows 7, for example, Microsoft officials reported that they had sold 350 million Windows 7 licenses.

    Windows 10 hit the same milestone in less than a year, thanks in no small measure to that free upgrade offer.

    Many of those 350 million devices, perhaps one-third or more, represent new PCs. Another big chunk represents newer devices (less than three years old) originally sold with Windows 8 or 8.1. Windows 10 has succeeded in cutting the share of devices running those versions by more than half over the past year, and the share of PCs running Windows 8.1 should be in the low single digits by the end of 2017.

    But what about Windows 7? The most recent figures measured by the US Government's Digital Analytics Program show that the percentage of Windows PCs running that version has dropped significantly in the past year, going from 71.1 percent in the first quarter of 2015, before the release of Windows 10, to roughly 56 percent at the end of July 2016.

    That's still a lot of Windows 7 PCs, And even the carrot of a free upgrade was not enough to move that number more than another few percent in the final months of that offer, which explains why the offer wasn't extended.

    There's plenty of precedent for this, based on past behavior. For Windows 7 and 8, Microsoft offered significant introductory discounts and then ended them on schedule after a few months, with no extensions.

    Financially, this decision is unlikely to have much of an impact. Retail upgrades have historically represented a microscopic share of Microsoft's revenue (see the chart in this article), and most customers who might have been willing to pay for an upgrade will have taken advantage of the free offer by the time the Anniversary Update rolls around.

    Asking existing Windows 7 users to pay $99 or more after they've spent a year avoiding the free upgrade seems like a surefire way to guarantee that they never upgrade. That significantly increases the risk of an XP-style mess come 2020.

    On the other hand, the free upgrade offer never really applied to large businesses that run Windows Enterprise editions. For those customers who also have purchased Software Assurance for those volume licenses, the Windows 10 upgrade offer is, if not free, at least already paid for. The decision of whether and when to upgrade is driven by business needs, not by the cost of an upgrade license.

    In the new "Windows as a Service" model, Microsoft said it plans to deliver two or three new releases each year. The Anniversary Update, which is rolling out to Windows 10 users now, is the first release in the Redstone update series. It's no coincidence that it arrived a few days after the original upgrade offer ended. Another Redstone feature update is scheduled to arrive in the first half of 2017.

    Of course, the end of this upgrade offer doesn't eliminate the possibility of a new offer. If not free, then perhaps a discounted in-place upgrade. But an extension of the current offer is not going to happen.

    One important date to watch is October 31, 2016. That's when OEM sales of new PCs with Windows 7 Professional officially end. That date marks the beginning of a three-year period in which the population of Windows 7 PCs will presumably shrink quickly as old PCs die and are replaced by newer models running Windows 10 (or aren't replaced at all).
     

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