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Longhorn could be tough sell for Microsoft

After five years without a major update to Windows, Microsoft will find plenty of willing buyers for Longhorn next year. Or will it?

Longhorn has already survived several major delays, intense scrutiny from the industry and a radical redesign of its features.

But the toughest test for Microsoft's next release of Windows is still to come: Will anyone buy it?

Even though it will be five years after Windows XP's debut, Microsoft could still face a tough sell when it releases Longhorn next year. With past updates, users had clamored for more stability and security, but analysts say people are pretty happy with Windows XP.

"Microsoft for the very first time is going to be faced with the challenge of being the player whose (operating system) is 'good enough'" as is, said Jupiter Research analyst Michael Gartenberg.

The challenge is one Microsoft has tackled for years with its Office software, but it's a relatively new problem for the Windows side of the house.

Microsoft managed to turn the launch of Windows 95 into a major event, with loads of mainstream press and consumer enthusiasm. However, subsequent releases have been considerably more subdued affairs, particularly the launch of Windows XP, which came just a few weeks after the Sept. 11, 2001, attacks. Even with its longest-ever time between OS releases, Gartenberg said, Microsoft will have to work to build demand for Longhorn.

News.context

What's new:
After several months of quiet about Longhorn, Microsoft is expected to start talking soon about the next version of Windows, which is slated to ship next year.

Bottom line:
Microsoft needs to come up with some strong selling points if it wants consumers and businesses to upgrade from Windows XP, an operating system analysts say is widely viewed as "good enough."

More stories on Longhorn

"Microsoft is going to have to find a way to take a page from the Steve Jobs playbook and make an operating system that not only looks interesting, but feels interesting," Gartenberg said.

Longhorn was supposed to achieve the sort of "quantum leap" Microsoft managed with Windows 95. The software maker began talking about Longhorn at a developer conference in the fall of 2003, years before the software would be ready. Microsoft spoke of it as a major advance, to which significant upgrades of other Microsoft software would be tied.

But faced with the prospect of having to further delay the OS, Microsoft decided last year to scale back its key components, and with them, some of Longhorn's ambitions.

The result is that Microsoft is on track to deliver a new version of Windows next year, but it has been unclear about what, exactly, the OS will contain.

"We know pretty much definitively that Longhorn is the next version of the Windows client," Gartenberg said. "Everything else goes downhill from there."

Things should become clearer next month when Microsoft offers an updated preview version of Longhorn at WinHEC, its Windows Hardware Engineering Conference, in Seattle. A more full-featured beta version has been promised by June.

What if you released an OS and no one came?
A lot has changed since Windows XP debuted in 2001. Wireless networking has become much more common, as have devices with Bluetooth. USB flash drives and other portable storage devices have essentially replaced the floppy disk, but they've brought along unique security issues.

Still, analysts say Windows XP has aged well, particularly with the Service Pack 2 upgrade that debuted last year and the Tablet and Media Center editions that have seen several updates in recent years.

"I don't hear anyone saying 'I've got to have Longhorn tomorrow,'" said Yankee Group analyst Laura DiDio.

Of course, a lot of that may have to do with the fact that Microsoft has been very quiet in recent months. Some details about Longhorn have emerged, but they shed only a modest amount of light on what Microsoft will use as the key selling points for its operating system.

At its lowest level, Microsoft is building Longhorn using the same code as Windows Server 2003 Service Pack 1, which lets the software maker take advantage of the security enhancements it made with Windows XP Service Pack 2--as well as the added support for 64-bit chips the company will debut next month, coincident with the release of SP1.

Microsoft has previewed two of the key technologies it has planned for Longhorn: its Avalon presentation engine and Indigo, its Web services architecture. Indigo is designed to let programs share data more easily, while Avalon should pave the way for programs that are more visually appealing. But most of the software that will take advantage of the technologies is not likely to arrive until sometime after Longhorn.

By the time Longhorn ships, Microsoft plans to have a new version of its Internet Explorer browser, though the company said last month that it will make IE 7 available for Windows XP, a break from the company's mantra that browser updates would require an upgrade of the operating system.

Microsoft has not talked in detail about its plans to integrate desktop search into Longhorn, but Gartner analyst Michael Silver said that's a clear requirement.

"People want that now and they have to look to third parties," he said, noting that Apple Computer will have significant search built into its Tiger operating system, which ships this year.

Mobile computing moves
At last year's WinHEC, Microsoft outlined some of the features it was evaluating that it said would improve mobile computing in Longhorn. Among the ideas it was toying with were the ability for notebook computers to have a second, easy-to-access interface for key tasks such as playing a DVD or consulting an address book. Another feature the company outlined was a synchronization engine that could make sure information is kept current between one or more PCs as well as on devices such as portable music players and flash memory cards.

The software maker also talked about a "mobility center" that would bring together controls for laptop-related settings--such as display, power management and networking--much as the Security Center does in XP Service Pack 2. A user could also create one profile that turned up performance for delivering a presentation, while a different "on the plane" profile might throttle down the power usage and turn off wireless connections. Such settings today must be changed individually and are scattered throughout the operating system.

It is unclear whether things such as the mobility center or DVD-playing interface are still on tap for Longhorn.

Longhorn will definitely include improvements for wireless networking, both Wi-Fi and lower speed cellular networks. A Microsoft representative said last week that simplifying home networking is "a key focus" for Longhorn. A new Network Explorer will show all the PCs and devices that are connected to a network, and the company plans to offer several options for securing a wireless network, something that remains quite difficult for most Windows XP users.

The company is also planning to bring back into the Longhorn client release some elements of its program to help businesses secure their network. The "Network Access Protection" feature, which helps businesses scan and update machines before they add them to a corporate network, has been moved around on Microsoft's roadmap several times. Most recently, the software maker took the feature out of this year's Microsoft Server 2003 "R2" release, leaving the impression it would not come into Windows until a server version of Longhorn in 2007.

However, Microsoft corporate vice president Jawad Khaki said in a Web chat last week that some elements of NAP would come in next year's Longhorn version.

"It will ship with some out-of-box capabilities to enforce policy compliance," he said. "Additionally, we are working with 40-plus partners who are industry leaders in antivirus, intrusion detection/prevention, network access devices and much more to support the NAP architecture."

Security, more broadly, is likely to be a key point of emphasis for both Microsoft's developers and its marketing pitch. The security work Microsoft did for the Windows XP Service Pack 2 upgrade shifted a good chunk of the Windows team off of Longhorn, though its efforts there have no doubt continued into Longhorn.

One thing that has changed, said Yankee Group's DiDio, is that businesses are significantly happier with Windows security now than they were a year ago. In a soon-to-be-published Yankee Group survey, Microsoft was given an average rating of 7.6 out of 10, up from ratings of well below five a year ago.

"We haven't had any major viruses or worms, knock wood, in the last few months," she said.

It is unclear whether that newfound support for Microsoft will make it easier or harder for the company to sell Longhorn as a security enhancement. On the one hand, customers are liking what they're seeing from the software giant. At the same time, they may feel more secure with the operating system they have than they might have felt a year ago.

The company is also looking to bring back some old ideas. It's working on a technology called "info-cards" in which consumers could securely store information that is to be shared with online commerce sites. Based on the WS-* Web services architecture, info-cards will help customers manage multiple identities, Microsoft said, much as people have multiple cards in their wallet: credit cards, bank cards and membership cards.

In many ways, the idea is a throwback to Microsoft's Passport authentication program, which met with only tepid interest from e-commerce companies and others. The software maker said it is talking with partners but would not say who it might have lined up in support of the info card plan.

DiDio said she sees an opportunity for Microsoft to expand the info card idea beyond the consumer and use it as part of an improved identity management option for businesses. She notes that one of the few bright spots for Novell in its recent financial report was the nearly $60 million the company pulled in from its new identity management product.

"Clearly you are going to see them expand on the idea of the info card," she said. "They always start with the consumer stuff and then go up to the server."

Keep it simple
Gartner's Silver said Microsoft should also make sure the upgrade process is as painless as possible, since many people are content with Windows XP. As a model, he pointed to a new compatibility tool Microsoft developed for XP Service Pack 2. The software tool works with machines that have not yet been updated to identify programs and behaviors that could be a problem once a machine is brought up to date.

"I think it's a good example of what they really need," he said. "OS upgrades are one of the more painful things people do. It's like ripping out your pipes every four years."

Though Microsoft has been quiet for many months about Longhorn, Gartenberg said he doesn't think that's necessarily a bad thing.

"Before you can start generating enthusiasm, you have to figure out what you are generating enthusiasm for," he said.

During the next 18 months, though, Microsoft will have to start gradually building its case for Longhorn.

"That's the challenge--to start getting the right people excited about it, without slowing down the wrong people, that is, the people just now deploying Windows XP, or SP2 on top of Windows XP."