The $28 Question

When asked "Why Twenty Eight Dollars for Hyper-V?" at the MMS analyst meeting, Microsoft's VP Bob Muglia said something to the effect -- "Well, we thought about it a lot and $28 seemed to be the right answer." You might remember that the last time Microsoft had to make a pricing decision for an add on product was of course when it decided to bundle Windows Internet Explorer for free. That eventually became a full employment opportunity for lots of lawyers and government agencies with Microsoft narrowly escaping some dire consequences (during which time Netscape basically faded away). So if "zero" was the wrong price back during the browser wars, then what's the right price for the hypervisor wars? Has Microsoft found a price that strikes a balance on a lot of fronts while not being so high that it would drive away customers and twenty eight dollars seems to have been the answer nor so low that it invites nasty government regulator inquiries? Usually it's not clear exactly when a product goes from an innovation to a commodity. But in the case of hypervisors, the day the price hit $28 could be that day the hypervisor became a commodity.