MICROSOFT is cutting the price of Vista at retail in what would appear to be an act of desperation to get sales moving. Home Premium and Ultimate editions will be discounted as of when Microsoft ships the first service pack of the OS.

Microsoft made the announcement on its website, in the form of a Q &A with Brad Brooks, corporate vice president for Windows consumer product marketing (must have a big business card).

Says Brooks:

“Windows Vista has been on the market for more than a year now, with more than 100 million licences sold in its first year. While this is great progress … we’ve observed market behaviour that suggests an opportunity to expand Windows stand-alone sales to other segments of the consumer market. Over the past year, we conducted promotions in several different markets combining various marketing tactics with lower price points on different stand-alone versions of Windows Vista. While the promotions varied region to region, one constant emerged – an increase in demand among consumers that went beyond tech enthusiasts and build-it-yourself types.”

Microsoft watches these things like a hawk so if it says lower prices will change Vista prospects, it probably knows of what it speaks, but from an outsider perspective, it might be the performance and lack of compelling features that has hurt Vista. After all, the current sticker price is the equivalent of a night out – how tight can people be? µ