Week in review: Vista off in the distance

Microsoft grabbed headlines this week after announcing it will push back the Windows Vista launch until January.

Microsoft dominated this week's headlines after announcing it will delay the release of its long-awaited Vista operating system until after this year's holiday shopping season.

The software giant said Tuesday that it would push back the consumer version of Windows Vista until January 2007 from a previous target of late 2006.

Microsoft will still wrap up development of the operating system this year and make it available to volume-licensing customers in November. But a delay of a few weeks in Vista's schedule meant that some PC makers would be able to launch this year and others would not. As a result, Windows chief Jim Allchin said, the company is delaying the broad launch of the product.

Fresh on the heels of the Vista delay, Microsoft confirmed later in the week that it is also pushing back the mainstream launch of Office 2007 to next year. As with Vista, the company hopes to finish the code for Office 2007 this year and will make it available to business customers that have signed up for the volume-licensing program.

Microsoft said the Vista launch was delayed for the benefit of computer makers, retailers and other partners. But analysts and others immediately challenged that assessment. Some said missing the holiday season was bad news for the whole industry and PC makers in particular.

Others analysts said Microsoft's pain will likely be Apple Computer's gain, because the Mac maker is already strong in areas where Microsoft has promised to deliver key improvements with Vista: security and features such as video and photo editing and search.

Meanwhile, the news created quite a stir around the virtual water cooler, with Web reaction running the gamut: Some were critical of Microsoft, saying the move is disappointing consumers, partners and stockholders. Others commended the company for taking the extra time to launch a solid product right out of the box.

CNET News.com readers were among the many to voice opinions. Among the 90 Talkback comments on the breaking Vista delay story, one theme was an overall lack of surprise, given Microsoft's track record of delays.

"Boy, didn't see that coming! (insert sarcasm here)," wrote reader Jeffrey J.

Others, like Ej Passeos, commented on the bad timing of the delay, which for "shareholders living with this long-time, non-moving stock," should be the final straw.

"I know many people who have set 'Christmas' time as the approximate time they would purchase a new computer," he wrote. "The timing here is appalling, unacceptable, and worth of heads rolling."

Following the Vista delay, word surfaced of a planned management shakeup at Microsoft. On Thursday, Steve Sinofsky was formally named as head of its Windows division as part of a reorganization to better align its Windows unit and its online MSN operations with its Live strategy. Some are wondering that the move came just a few days after the Vista delay.

The latest Vista delay highlights a mounting challenge for Microsoft--finding a way to update its most important product on any kind of reasonable schedule. With all the setbacks, it will be more than five years between Windows XP and Windows Vista. And for even that delivery schedule, Microsoft had to scale back many of the major advances that were planned for the new operating system.

That said, Microsoft has been playing catch-up with the changing times, readying a full slate of software and hosted services for building Web applications on a range of devices, from desktop PCs to mobile phones. Some of those were showcased this week at Microsoft's Mix '06 conference in Las Vegas.

Following his keynote speech at the gathering, Microsoft Chairman Bill Gates spoke to CNET News.com about the push into hosted services, competition with Google, and mobile computing.

Also at the conference, another Microsoft executive said U.S consumers bought more Windows Media Center-equipped PCs than the standard edition of Windows XP last month, and sales of Media Center will reach 10 million by the end of March.

They've got game

One of the big stories from the in San Jose, Calif., this week was the confirmation of a November release for the PlayStation 3. In a speech Wednesday, Sony Computer Entertainment President Phil Harrison also said the company is committed to a simultaneous worldwide launch of the PS3 in Japan, the rest of Asia, North America, Europe and Australia. Sony will produce about a million PS3s per month and capacity will ramp up quickly, he added.

The question Sony will have to face until November, and for at least a year afterward, is whether the head start Microsoft got with its November 2005 launch of the Xbox 360 console will be too much for Sony to overcome.

Also at the conference, Microsoft announced that it plans to increase its weekly distribution of the Xbox 360 game console by at least twofold.

The software giant said the addition of a new manufacturing partner, Celestica, will allow it to ship "two to three times" more Xbox 360s to retailers each week. Celestica joins Wistron and Flextronics in manufacturing the system and components for Microsoft.

The announcement coincides with Microsoft's release of its new spring line of games. The company also announced additions to its downloadable digital-content zone, Xbox Live Marketplace, which it says is being used by more than 85 percent of connected Xbox users.

Other issues discussed at the conference were mobile gaming and challenges for the little guys to compete with giant publishing houses like Electronic Arts; and the serious-game genre, and what those involved must do to keep it alive and strong.

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