It’s hard to argue that Windows Vista hasn’t been a disappointment for Microsoft. And it hopes the next version, Windows 7, will reverse its fortunes.

Despite the fact that early reviews of Windows 7 provide reasons for hope, the success of it is far from certain. One of the biggest unknowns: whether or not Microsoft’s new Windows Anytime Upgrade will sink or swim.

Windows 7 will come in six flavors, two of which (Home Premium and Professional) will be widely available to consumers via retail licensing. Other flavors will be made available to OEMs and in select markets.

What is Windows Anytime Upgrade? Put simply, it will enable consumers to upgrade to a more feature-rich flavor of Windows 7 by purchasing a license online, which will ‘unlock‘ the functionality of the version purchased (which is already present but deactivated).

Microsoft hopes that this will make it possible for users to more easily select their desired version of Windows 7; it will also give OEMs the ability to bundle less expensive versions of Windows 7 with their machines.

The big question, however, is whether or not Anytime Upgrade is a good idea. From a consumer standpoint, it’s a mixed bag. While it sounds great than an OEM can bundle Windows 7 Starter on a netbook while maintaining competitive pricing, for instance, Windows 7 Starter has been described as ‘crippled‘ since some of its limitations include the ability to only run 3 applications at once; anything more than that requires an Anytime Upgrade.

Needless to say, Microsoft runs a real risk of making consumers feel nickel and dimed. While the economics of Microsoft’s model make sense from Microsoft’s standpoint (it it looking for ways to remain competitive on price and hopefully maintain margins in the face of pressure on its core business), one has to wonder if this is an otherwise sensible model that really isn’t so sensible in the OS market.

After all, previous versions of Windows never had limitations like this and although various versions of Windows did exist, I’d bet that few mainstream consumers can explain the difference between Windows Vista Home Premium and Windows Vista Ultimate. That’s because they weren’t missing core functionality and being reminded to upgrade.

Even if Windows 7 is a great improvement over Vista, Microsoft has to be very careful in my opinion. The Anytime Upgrade model, if abused, could turn an otherwise good OS into another disappointment.

Photo credit: impresa.mccabe via Flickr.