Microsoft could end up shelling out $8.5bn (£6.1bn) to settle with all of the customers involved in the Vista Capable lawsuit.

The lawsuit claims Microsoft defrauded customers by promoting PCs and laptops as 'Vista Capable' when they could only run Windows Vista Home Basic, which the plaintiffs have contended, is not the 'real' Vista, in large part because it lacks the Aero user interface. Microsoft has denied that it duped consumers, and has countered that Home Basic is a legitimate version of Vista.

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The estimated figure was contained in documents published by the US court, which is handling the lawsuit against the tech company. Microsoft dismissed the estimate in a filing of its own yesterday, saying it was "absurdly [valued]" and if damages were granted, added that it would be a "windfall to millions".

Keith Leffler, a University of Washington economist and expert witness for the plaintiffs, calculated that it would cost a minimum of $3.92bn (£2.86bn) and as much as $8.52bn (£6.1bn) to upgrade the 19.4 million PCs sold as Vista Capable to hardware able to run the premium versions of Windows Vista.

In a heavily-redacted report, Leffler said he had used data provided by Microsoft to arrive at the number of ‘Vista upgradeable' PCs sold in the US from April 2006, when the Vista Capable campaign started, to January 2007, when Vista hit retail shelves and the program ended.

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Of those PCs, 13.75 million laptops and 5.65 million desktop computers were classified as Vista Capable but not able to meet the more stringent requirements for the 'Premium Ready' label, Leffler estimated.

By the criteria set by Microsoft and passed to computer makers, Vista Capable meant that the machine was able to run at least Windows Vista Basic, the entry-level edition of the line. Such a system, however, might not be able to run a more powerful version, or if it could, might not be able to execute all its features. A Premium Ready logo, on the other hand, indicated that the PC was able to run higher-end versions, such as Vista Home Premium, Vista Business and Vista Ultimate.

Leffler arrived at his minimum and maximum upgrade costs by estimating how much it would cost to upgrade each Vista Capable machine to 1GB of memory and a graphic card capable of running Aero. It would cost a maximum of $155 (£113) to upgrade each desktop, and between $245 and $590 (£179 and £431) to upgrade each laptop.

NEXT PAGE: Upgrades would be a windfall for millions

Microsoft could end up shelling out $8.5bn (£6.1bn) to settle with all of the customers involved in the Vista Capable lawsuit.

The wide range on laptop upgrade costs, which in turn produced the large difference between Leffler's overall minimum and maximum numbers, were due to the more expensive replacement of a portable's graphics chipset. In some cases, Leffler said, the laptop would not be able to be upgraded sufficiently to handle any edition of Vista but Home Basic, and alluded to the need then to replace the system with a new machine.

All told, it would run Microsoft $833m (£609m) to upgrade the Vista Capable desktop PCs, and between $3.08bn and $7.69bn (£2.25bn and £5.62bn) to fix the affected laptops.

Those numbers dwarfed the $1.5bn (£1.1bn) that Leffler had earlier estimated Microsoft earned from the sale of PCs marked as Vista Capable. Microsoft's lawyers may have been comparing the figures when they blasted the plaintiffs' call for upgrades.

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"Plaintiffs seek a remedy that would give them a Premium Ready PC even though they paid for a non-Premium Ready PC," said Microsoft.
"To give class members free upgrade to Premium Ready PCs would provide a windfall to millions because no one can know who among the class (a) intended to upgrade to Windows Vista, or (b) wanted a Premium Ready PC, or (c) would have chosen to pay more for a Premium Ready PC just so they could run Windows Aero," Microsoft argued.

The lawsuit is currently set for an April trial.

See also: Ballmer forced to testify in Vista Capable suit