I'm making an educated guess here and sure that this applies to some circumstances and not others..... it's based on a cruise we just returned from (Princess Grand).
We booked only five weeks before departure and paid $529 each for guaranteed category (FF outside cabin obstructed view) but with no cabin assignment. I asked our TA (who is a cruise only specialist) about upgrades after seeing them mentioned here and she said to sit tight and see what happened. My GF was concerned about not having a cabin assignment when we got close to the sailing date but I wasn't concerned.
Here's what happened:
The cruise appeared to be close to totally booked but many of the rooms were being held for some sort of travel agent booking - it's the deal where TA's get to sail at a special price during a traditionally slow week (we sailed Oct 12 - Oct 19) and the focus for Princess is to get TA's exposed to a ship they have not previously sailed on.
Apparently there were quite a few rooms released a few days before sailing. The fact that very few schools are on break at that time of year and the northern states aren't yet into the cold winter season may also be a factor in lower bookings.
About five days before departure we were given a cabin assignment - E110 on the Emerald deck - an upgrade from our previous category. E110 is unobstgructed view near the bow where the upper portion of the outside promenade walk is - the outside area is closed to walkers at night and it is an unobstructed view.
Two days before sailing we got the really good news: we were upgraded AGAIN! This time it was to C102 on Caribe deck. It's all the way towards the bow on the port side and has a partially covered/partially open balcony. We absolutely loved having a balcony and would find it difficult to sail without one in the future. It was a bit of a hike to the room to reach things but the extra exercise was welcomed by some of us {;-)
MY GF made an interesting observation that may be relevant - we were celeberating an anniversary that week. When you set up your Express Check-In profile on the Princess web site (highly recommended for many reasons), there's a space to indicate whether you're celebratin an anniversary, just married or having a birthday that week. Nearly every balcony cabin in our wing (Port side forward) had ballons outside the room indicating that the occupants were celebrsating one of thes three occasions. It seems unlikley that everyone on the wing actually paid for baclony cabins - I'm guessing that some upgrades are given to folks who have a special occasion during the week of the cruise.
It's worth noting that a week before sailing we woul still have been required to pay a $600 per person upgrade fee to get a guaranteed balcony cabin.
