Analysts predict interim Windows

Microsoft will slip out an interim desktop version of its Windows operating system before 2004 under pressure from some customers who signed up for its new enterprise licensing plan, several analysts predict.

Microsoft will slip out an interim desktop version of its Windows operating system before 2004 under pressure from some customers who signed up for its new enterprise licensing plan, several analysts predict.

Microsoft’s current roadmap calls for the next release of Windows for the desktop to appear in the second half of 2004, officials say. That release is code-named Longhorn, and Microsoft has promised to pack a number of new technologies into the operating system that coincide with its web-based .Net initiative.

However, industry watchers say Microsoft is poised to miss the deadline for Longhorn, which would leave customers that signed up for its new annuity licensing plan, known as Software Assurance, paying for a product that they may not receive. Those contracts, which last three years, require customers pay an annual fee each year during the life of the contract for access to bug fixes or new operating system releases.

“If people sign up for Software Assurance and no new [desktop] versions of Windows are made available during the three-year period, there could be some customers that pay but get no value out of it,” says Alvin Park, research director at Gartner.

One New Zealand manager is not surprised at the possibility of an interim desktop OS, and regards it as a positive sign from Microsoft.

Enza IT manager Adam Hunt believes it would be too easy to say “I told you so”, but says the news suggests a new level of customer responsiveness from Microsoft. Since the troublesome and protracted introduction of Software Assurance the company has “grown up”, he believes.

Microsoft New Zealand head Ross Peat says he has no knowledge of Longhorn delays nor of an interim Windows release. He says, however, that software development is a “challenging field”, particularly with large releases such as Longhorn. If Longhorn isn’t ready in time, the company has the option of smaller, interim releases, he says.

Hunt says Software Assurance is more about maintenance than new versions and is comparable to maintenance agreements with other software companies such as Oracle.

Customers who buy Windows under Microsoft’s Enterprise Licensing Agreement or through other Software Assurance plans pay 29% of the cost of Windows on the desktop and 25% of Windows for the server each year during the life of the contract. If a customer bought Windows through Software Assurance in late October 2001, when Windows XP was released, they would be eligible for an upgrade through October 2004.

Microsoft offered customers a discount if they bought Windows under the new licence by July 31 of this year, and Gartner’s Park estimates that at least 35% of Microsoft’s enterprise customers took advantage of that deal.

At least two analysts say that Longhorn won’t actually reach customers until the second half of 2005, and as a result will force Microsoft to release an interim product that it can deliver to Software Assurance customers whose contracts expire before then. “There’s really no doubt about it,” says Tom Bittman, another Gartner researcher.

Rob Enderle, research fellow with Giga Information Group, says “there’s every likelihood” that Longhorn won’t meet Microsoft’s late-2004 deadline. The company is working to add more security to the software and is spending more time analysing code, which is slowing down the process of shipping new code to customers, he notes.

A Microsoft US spokesman was firm that it wouldn’t ship a desktop Windows product that wasn’t already on its roadmap. “There’s no plan for anything to come out before the next version of Windows, which is Longhorn,” says Jim Cullinan, group product manager with Microsoft’s Windows division.

Microsoft has a history of delaying Windows releases. The Windows .Net Server 2003 was originally scheduled to ship about six months after Windows XP, which would have put it on the market in May of this year. Microsoft has twice moved back that date and now expects to ship the product to manufacturers before the end of the year, which would set it up to reach most customers in early 2003.

Enza’s Hunt says in the past three months he has found Microsoft New Zealand to be forthcoming and much more approachable. ENZA, which is a 100% Microsoft shop, hasn’t signed up to Software Assurance and is piloting Linux for several applications. However, Microsoft has told him that if Linux is best for Enza, that’s what the organisation should go with.

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