XP update yields to settlement terms

Microsoft on Thursday will release a long-anticipated test version of its revamped Windows XP that includes changes meant to benefit consumers and increase competition.

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Microsoft plans to release a long-anticipated test version of an update to Windows XP on Thursday, a company representative said.

The update, or Service Pack 1, will ship to about 10,000 testers, according to the representative. As previously reported, it will include features intended to make it easier for consumers to choose third-party software over Microsoft's own products, in compliance with a settlement brokered in Microsoft's 4-year-old antitrust case.

The service pack will introduce four options for managing, customizing or removing Internet Explorer, Outlook Express, Windows Media Player, Windows Messenger, Microsoft's version of the Java Virtual Machine, and competing so-called middleware from other companies.

Microsoft is moving ahead with the change, even though U.S. District Judge Colleen Kollar-Kotelly has not approved the November deal cut between Microsoft, the Justice Department and nine of 18 states. Nine other states and the District of Columbia have continued with litigation. Lawyers for plaintiffs and Microsoft next go to court June 19 for closing arguments to the proceeding that could lead to stiffer sanctions against the software giant.

The service pack will also introduce support for new technologies--such as Mira "smart" display devices, Tablet PCs and the Freestyle digital media interface--and will radically change how much control consumers or PC makers have over middleware components.

Even as Microsoft prepares the biggest service pack for its most-important operating system ever, analysts question just how many consumers will eventually apply the update.

"The problem with service packs--and this one is probably more important than most--is it doesn't register with most current owners in terms of downloading it or using it," said NPD Techworld analyst Stephen Baker. "Some of the improvements or enhancements in these things don't get disseminated."

Consumers applying Service Pack 1 will only get a peek at one of the new technologies, Mira. Mira devices rely on the remote desktop protocol included in Windows XP Professional. Most consumers received Windows XP Home on their PCs. Only customers with XP Professional with Service Pack 1 will be able to use Mira devices when they become available later this year.

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The updates incorporating support for Tablet PC and Freestyle, a second XP interface for accessing the operating system's digital media functions via remote control, will be available only to PC makers installing the update.

Microsoft typically does not issue a service pack to such a large number of testers, but the number of new technologies and changes affecting middleware customization mandate a broader testing process, the company said. PC makers also need extra time to test different middleware configurations on their systems and prepare Freestyle computers and Tablet PCs for the holiday buying seasons.

With the new middleware customization feature, PC makers will have more choices in terms of Microsoft applications or third-party software such as AOL Instant Messenger and RealNetworks' RealOne player. This process requires longer testing, particularly because analysts predict a second landgrab for the Windows desktop. Following a Windows licensing change last summer, Microsoft competitors cut deals with PC makers for placement on the Windows XP Start Menu or desktop.

"All the PC guys have always said they wanted an opportunity to control the desktop, to control what people see," Baker said. "They have the opportunity to sell those pieces of the puzzle to cover costs. I am sure they will jump on that opportunity as fast as they can."

Microsoft expects to issue a final version of Windows XP Service Pack 1 sometime in late summer, but the schedule is uncertain depending on testing. Already, the Redmond, Wash.-based company missed its tentative May release date for the service pack test version.