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The week in review: XP arrives

Microsoft officially launches the long-awaited Windows XP, the newest version of its operating system and what could be the company's most important product in more than six years.

Microsoft finally took the wraps off Windows XP, but now the real wait begins: Will consumers and businesses sign on to the new operating system?

Hailed as one of the company's most important products, Windows XP was feted at a lavish extravaganza in New York. Microsoft has a lot riding on XP's success: The operating system ushers in new features tied to Microsoft's long-term strategic plans for media player software, digital photo tools and online services.

The new operating system carries monumental significance for the high-technology industry and the future of the Internet. In a multi-day special report, CNET News.com reporters examined the company's multifaceted strategy from legal, economic and practical perspectives. The package takes an in-depth look at Microsoft's .Net strategy and whether Windows XP adoption will effectively act as the gatekeeper for a whole new era of networking computing.

People interested in buying Windows XP may be surprised by the hefty package of downloads for updating the new operating system. Depending on the version of XP--Home for consumers or Professional for businesses--people will be assailed with 20MB or more in downloads. Some fix security holes, others resolve glitches and a few add new features.

Read about all the news surrounding the unveiling of Windows XP here.

Browser battles
The redesign of MSN.com, Microsoft's popular portal site, has inspired the anger of Web users who choose to surf the Net on a browser other than Internet Explorer. The redesign, as first reported by CNET News.com, was found to effectively lock out third-party browsers from viewing the MSN site.

As a concession, Microsoft late Thursday said it had reopened the MSN site to rival browser makers, but as of Friday morning, the most recent browsers from Mozilla.org and Opera Software still could not access MSN. Netscape users also continued to report access problems.

The troubles also have stirred up further anticompetitive concerns. Late Thursday, the Washington-based trade group ProComp joined the outcry against the browser lockout by asking state and federal trustbusters to get involved. The continuing antitrust lawsuit against Microsoft, now moving into what should be its final stage, got its start in the mid-1990s because of concerns that the company was using its dominant position in operating systems software to gain an unfair market advantage for its Internet Explorer browser.

In other news, Yahoo has sneaked into the browser wars right under the noses of AOL Time Warner and Microsoft. The Web portal's new "Yahoo Essentials" takes over Microsoft's Internet Explorer by turning Yahoo into the browser's default home page and search engine, redirecting any keywords entered into the IE address bar into Yahoo's search results.

If Yahoo's aggressive move is successful, copycats could emerge that also seek to take over IE, threatening to spark a renewed tug-of-war over the browser interface that could wipe out much of Microsoft's inherent advantage in controlling the underlying software.

Server wars
Hewlett-Packard has been struggling in the Unix server market, but the company plans a counterattack on Sun Microsystems and IBM with a new server featuring twice as many processors as HP's current top-end Superdome.

In 2003, HP will upgrade its 64-processor Superdome with a 128-processor goliath using HP's PA-RISC 8800 chips. The 8800 chips combine two CPUs on a single slice of silicon, a technique pioneered by IBM with its new Power4 chip.

HP already seems to be winning the bidding war for the disaster-recovery division of computing services company Comdisco, with the company accepting a higher bid from HP and the Department of Justice seeking to block a rival bid by SunGard Data Systems.

The division, called the Availability Solutions Group, helps companies plan for and deal with disasters such as earthquakes or attacks such as that of Sept. 11. Comdisco's board and creditors' committee approved HP's $750 million bid and withdrew support for an earlier $825 million bid from SunGard.

Despite big obstacles, SunGard isn't dropping its bid for the division. The company reiterated its belief that the Department of Justice's lawsuit was without merit, said the parties involved in the suit have agreed to resolve the case by Nov. 15, and said it was willing to increase its current $850 million bid.

HP and IBM already provide some disaster recovery services, but SunGard specializes in them. The services typically involve the provision of backup, PC-equipped office space, as well as servers and storage systems that can be used when primary systems are unavailable.

Apple harvest
Apple Computer unveiled the iPod, a digital music player that can store 1,000 songs on its hard drive. The product, the size of a deck of cards, costs $399, has a 5GB hard drive, connects to a Mac using FireWire, includes a 10-hour lithium polymer battery, offers 20 minutes of anti-skip protection, and works with Mac OS 9 and Mac OS X. It will be available Nov. 10.

Apple also quietly discounted one iMac model to $499 through dealers here and in New York, apparently in memory of those affected by the Sept. 11 terrorist attacks. Many local dealers cheered the discount, which shaves $400 off the original price of the now-discontinued model.

Once viewed as the enemy by the Mac community, Microsoft is getting closer to delivering one of the most important applications for Apple's new operating system. The software giant took the last big step in development when it released Office for Mac OS X "gold code" to manufacturing. It also set Nov. 19 as the date for the application suite to go on sale. In addition, Microsoft clarified pricing for Office v. X and reported 90,000 downloads of the Word X Test Drive.

Also of note
AT&T's bid to buy Excite@Home's broadband Internet access business took another step backward, as a bankruptcy judge said he was loath to approve it in the face of strong creditor criticism...The 18 states working with the Justice Department to prosecute Microsoft retained veteran attorney Brendan Sullivan to lead their cause...Napster laid off 16 people, or about 15 percent of its employees, in the first serious staff cuts in the company's meteoric history...Across the United States, H-1B visa workers from Central and South Asia are expressing concerns about discrimination, and some are worried about a broader backlash against foreign professionals...Bill Gates spent a day on the set of "Frasier" at Paramount Studios filming an episode of the prime-time TV show set to air Nov. 13.

Want more? Check out all this week's News.com headlines.