After a ton of guesswork and rumors flying around, Microsoft has finally confirmed what much of the evidence was pointing to: there will indeed be six editions of Windows 7, just like there were for Windows XP and Windows Vista. Customers will be able to choose from Windows 7 Starter Edition, Windows 7 Home Basic Edition, Windows 7 Home Premium Edition, Windows 7 Professional Edition, Windows 7 Ultimate Edition, and Windows 7 Enterprise Edition. The news comes hot on the heels of the Windows 7 Ecosystem Readiness Program announced yesterday.

All editions will be available in worldwide markets except for Home Basic, which will be offered in emerging markets. Starter will be also available worldwide but only via OEMs.

"We know emerging markets have unique needs and we will offer Windows 7 Home Basic, only in emerging markets, for customers looking for an entry-point Windows experience on a full-size value PC," Mike Ybarra, General Manager for Windows said. "We’ll also continue to offer Windows Starter edition, which will only be offered pre-installed by an OEM. Windows Starter edition will now be available worldwide. This edition is available only in the OEM channel on new PCs limited to specific types of hardware."

Most users will only use Home Premium, Professional, and Ultimate, which is why Microsoft is expected to only offer upgrade paths for these three.

Here is how the different versions differ from each other:

Windows 7 Starter (worldwide via OEM only): up to three concurrent applications, ability to join a Home Group, improved taskbar and JumpLists

Windows 7 Home Basic (emerging markets): unlimited applications, live thumbnail previews and enhanced visual experience, advanced networking support (ad-hoc wireless networks and Internet connection sharing), and Mobility Center

Windows 7 Home Premium (worldwide): Aero Glass and advanced windows navigation, improved media format support, enhancements to Windows Media Center and media streaming, including Play To, multi-touch and improved handwriting recognition

Windows 7 Professional (worldwide): ability to join a managed network with Domain Join, data protection with advanced network backup and Encrypting File System, and print to the right printer at home or work with Location Aware Printing

Windows 7 Ultimate (worldwide): BitLocker data protection on internal and external drives, DirectAccess for seamless connectivity to corporate networks based on Windows Server 2008 R2, BranchCache support when on networks based on Windows Server 2008 R2, and lock unauthorized software from running with AppLocker

Windows 7 Enterprise (volume licenses): same as Ultimate, includes the following improvements: DirectAccess, BranchCache, Search, BitLocker, AppLocker, Virtualization Enhancements, Management, as well as Compatibility and Deployment.

We weren't crazy about the proliferation of Vista versions, so we have mixed feelings this time around. The Vista version differentiation is essentially a cash grab, and the same is true with Windows 7. We had hoped that with the new version, Microsoft might be a little less egregiously money-grabbing.

That said, the Windows 7 line-up does address some of the problems with the Vista line-up. Vista's delineation between versions simply didn't make a lot of sense. It assumed computers were used far more narrowly than is actually the case, and put the consumer in the unfortunate position of having to choose—"Do I go for remote desktop and shadow copies, or do I go for Media Center?"—or buy the considerably more expensive Ultimate edition.

The Windows 7 line-up fixes that major problem; by making pricier versions true supersets of cheaper versions, the decision making is a lot simpler. No longer is it necessary to make a choice between unrelated features. The reinstatement of the Professional branding (instead of Vista's Business brand) also provides a useful join-up with the familiar XP branding.

The relegation of Home Basic to emerging markets should also mean that—in first world markets, at least—the proliferation of versions isn't so immediately apparent. In conjunction with the cleaner segmentation, the choice betwen Home Premium, Professional, and Ultimate is now much clearer. Whether consumers were ever really confused by the different Vista versions is hard to say, but either way the problem should be greatly reduced in Windows 7.

On the other hand, the decision to make the crippled Starter edition available worldwide is quite extraordinary; the appeal even in emerging markets is unclear, and since even netbooks are more than up to the challenge of running Home Premium, the purpose of this is completely unclear. Many commentators have suggested that there should be a dedicated netbook edition, but even if one buys into that idea (we don't), Starter edition ain't it.

The new SKUs are certainly an improvement over the Vista ones, and for that we should be grateful. It is gratifying that Microsoft has listened to the criticism of Vista's versions and taken at least some of it on board. It's still disappointing that the company still feels the need to so openly maximize its revenue; this is not behavior that breeds goodwill. A reversion to the XP launch line-up of Home and Professional would be far more palatable. Windows 7's version line-up is certainly a step forward—but what we were really hoping for was an even bigger step backward.