Who would pay outrageous prices at the Microsoft Store?

With great fanfare, Microsoft recently debuted a download store, where you can buy Microsoft products such as Office via download. But considering that many downloadable products cost 40% more than the DVD versions on Amazon, who would buy?

Every single product I saw cost considerably more for a download-only version at the Microsoft Store compared to Amazon. For example, at the Microsoft Store, Microsoft Office Ultimate 2007 sells for $679.95. On Amazon, you can get it for $399.99, or even less if you're willing to buy from an Amazon merchant --- I found one new copy selling for $249, which means less than half the price that Microsoft charges for a downloadable version.

For Office Professional 2007, you'll pay $499.95 for the download, versus $399.99 for the DVD from Amazon. And I found one Amazon merchant selling it for $129.99.

The list goes on --- you'll spend far less for virtually every edition of Office on Amazon than on the Microsoft Store, and you also get the benefit of having it on DVD rather than only via download.

Operating systems cost more as well --- $319.95 on the Microsoft Store versus $249.99 from Amazon, or even lower from Amazon merchants.

So what, exactly, was Microsoft thinking when it launched this store? Who would want to pay 40% more, have to put up with downloading hundreds of megabytes, and then not get a physical DVD?

Beats me, unless Microsoft adheres to the P.T. Barnum rule of retailing: There's a sucker born every minute.

Preston Gralla is a contributing editor for Computerworld, and the author of more than 35 books.