The real cost of Windows 7: $1,930?

When you include replacement hardware, admin costs, application testing, and replacing incompatible apps, Gartner’s VP of research, Michael Silver, believes that — in a hypothetical organization with 2,500 Windows users — the cost of upgrading from Windows XP to Windows 7 will run $1,035 to $1,930 per user. Silver’s cost estimate of migrating from Vista is a fraction of that number: from $339 to $510.

No doubt organizations already mired in Vista will roll out Windows 7 in a hurry for usability, compatibility, and performance reasons. But the value prop for the XP masses remains elusive.

[ Pound for pound, which is the better desktop OS, Snow Leopard or Windows 7? Find InfoWorld’s answer to that question in our PC vs. Mac deathmatch. ]

After last week’s saturation coverage of Windows 7, I will spare you the laundry list of changes and new features (check out our Windows 7 Deep Dive Report for that). But I ask you to imagine the hypothetical CFO of that hypothetical 2,500-user organization, staring at an upgrade cost of between $2,587,500 and $4,825,000. Glaring at that number, looking at it sideways, maybe turning it upside down. And this buys us … what, exactly?

Even as, post downturn, the desktop hardware upgrade cycle kicks into gear again — which Gartner says is already happening — the obvious fact that Windows 7 will be pre-installed on new hardware does not ensure migration. As InfoWorld’s Galen Gruman reported last week in “Was Windows 7 worth saving XP for?” a Hewlett-Packard exec said he expects many if not most businesses to “downgrade” Windows 7 to XP through much of 2010 (an option for some editions of Windows 7 until April 23, 2011).

It’s tempting to be dramatic and declare the Windows treadmill broken beyond repair. Steve Ballmer’s rather manic performance at the official Windows 7 launch last Thursday suggests that, in his heart of hearts, even he believes that the world has changed. I could push things even further and point to today’s “PC vs. Mac deathmatch: Snow Leopard beats Windows 7” as evidence that the Mac will eventually become the default corporate desktop.

But I’m not going to go there. Other Windows alternatives — desktop Linux, say, or Google OSes in the cloud — have their own huge obstacles. It’s a safe bet that by the end of 2011 it will be more of a pain in the butt for businesses to hang on to XP than it will be to upgrade to Windows 7, and eventually, we will slouch into the new OS.

Meanwhile, we can speculate all we like about Windows 8. But what, exactly, would make any new revision of a desktop OS a thrill? Until the industry discovers — as it has attempted to do for the past decade — a vastly more compelling way to integrate the Internet into everyday desktop user experience, the old desktop dynamic will continue to limp along. The treadmill may not be broken, but man, has it slowed down.

This story, “The real cost of Windows 7: $1,930?,” was originally published at InfoWorld.com. Follow the latest developments in Windows 7 and Windows at InfoWorld.com.