We may be getting out of our long recession, but we are not out of the woods yet. Recession-friendly gadgets such as netbook will still be very attractive to consumers in these tough times. But if you are expecting for netbook prices to drop anytime soon, we’ve got bad news for you. Microsoft and its partners are expected to raise netbook prices on consumers with the release of Windows 7. Microsoft’s Steve Ballmer claimed that the company had misread the market conditions when it  tried to reduce Windows prices to induce demand. It seems Microsoft has not gotten anything tangible out of the move and is planning to increase prices to make up for the profits lost:

Ballmer also explained that the company’s goal is to raise PC prices in the next year. That’s due both to expected popularity of a new class of higher-end and higher-priced netbooks, a new pricing strategy around Windows 7 that the company hopes will result in far more upgrades to premium skus, and a reversal of a strategy in the last year to cut prices to spur demand in emerging countries.

I do agree that Microsoft seems to be putting more effort in to make Windows 7 a success that Windows Vista wasn’t. But I am just not sure Steve Ballmer is taking the right approach here. Increases prices on consumers will not increase demand. A lot of people will be complaining once they realize what a pain in the neck Windows 7 could be. It’d make sense for companies to increase high-end laptop prices, but it’s absolutely comical to believe that somehow raising netbook prices will increase demand for these gadgets. Netbooks are recession friendly gadgets. They are designed for individuals who are looking for portability and affordability. Raising prices without adding more features will only make people want to go with Linux or Android systems.

Windows 7 looks to be a great operating system, and it’s certainly getting closer and closer in look and feel to Mac OS. I am just not sure putting it on a netbook and then asking for more money will be the answer for Microsoft. There is nothing wrong with Microsoft trying to increase its profits, but I certainly hope they have improved Windows 7 enough to make people want to upgrade. As someone who got burned with my Vista upgrade, I am doubtful.

Your take: is it a smart move to increase Windows 7 netbook prices?