Microsoft today will announce its plans for the various Windows 7 product editions it will sell when that OS is released to the public sometime this year. The announcement was eagerly awaited because of the confusing and broad range of Windows Vista product editions, with their overlapping feature sets.

I'm thrilled to reveal that it's good news for a change. Unlike with Vista, where Microsoft crowded the market, Windows 7 will ship in just a handful of common-sense product editions. And also unlike with Vista, these product editions are all supersets of each other, so there are no overlapping feature sets (which is good) and simpler upgrading (which is even better).

For this version of the OS, Microsoft and its PC maker partners will market just two mainstream product editions, Windows 7 Home Premium--the recommended choice for consumers--and Windows 7 Professional, which is aimed at enthusiasts and IT professionals.

Here's how the complete product line breaks down (where each product edition is a superset of the one before it.)

Windows 7 Starter. This version will be sold only through PC makers to users in emerging markets. As with previous Windows Starter Edition products, it is limited in some ways: You can run only three applications at once, you don't get Windows 7's full mobility capabilities, and you can participate in but not create a Home Group.

Windows 7 Home Premium. The volume Windows 7 offering for consumers builds on Starter and includes Mobility Center, Aero Glass, advanced windows navigation features like Aero Snap and Aero Peek, and multi-touch, as well as the ability to both create and participate in Home Groups. Home Premium will be sold at retail and be included with new computers.

Windows 7 Professional. This version builds on Home Premium and adds features like domain join, Group Policy controls, location-aware printing, advanced backup, EFS, and offline folders. Pro will be sold at retail and be included with new computers.

Windows 7 Enterprise. As before, Enterprise is aimed at Microsoft's Software Assurance (SA) volume-license customers. This time, however, Enterprise is a superset of Professional and adds much-heralded Windows 7 features like Direct Access, Branch Cache, BitLocker, and BitLocker To Go.

Windows 7 Ultimate. For those few customers who simply must have everything, Windows 7 Ultimate offers all of the features from Enterprise but loses the volume-licensing requirement. So you can think of Ultimate edition as Enterprise for consumers (and other retail customers).

So you may be looking back over this list and thinking, well, hold on a second there: That's five product editions. Are they really simplifying anything? Yes, they really are. Microsoft and its partners will focus most of their efforts selling Home Premium and Pro to the retail and consumer markets, and Enterprise to volume licensing business customers. Ultimate and Starter are, by definition, niche products that are available only to address low-volume but important markets. But what really makes this work is the "Russian doll" structure where each version is a true superset of the one below it. With Windows Vista, Home Premium had some features that Business did not and vice versa. That made choosing a product edition difficult.

A few other product edition notes: It will be possible to electronically upgrade from any Windows 7 product edition to a higher-end product edition, and to do so quickly and easily. So even a Starter edition user will be able to upgrade all the way up to Ultimate if they so choose.

Vista users will face simple upgrade choices: You can go from Vista Home Basic or Home Premium to Windows 7 Home Premium or any higher product edition, for example. XP users? They can only "upgrade" by performing a clean install of Windows 7--Microsoft will not support an in-place upgrade--but there will be utilities to smooth the process and get data transferred over easily.

There's a lot more to come around pricing and upgrading, of course, but I'm told Microsoft will have more news soon. For now, what I'm seeing is a very, very positive step.

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