Windows Secrets Newsletter • Issue 180 • 2009-01-08 • Circulation: over 400,000

By Dennis O’Reilly

Microsoft has acknowledged that it will allow system builders to pay for installed copies of XP through May 30, rather than shutting down the pipeline this month.

If you order from your preferred vendor by Jan. 31, you may be able to rely on XP for new systems almost right up until the long-awaited Windows 7 ships, an event that’s expected to occur within a few months.

Vista is looking more and more like the Edsel of the computer industry. Presumably as a result of slow uptake by corporations and individual users, Microsoft last month confirmed that it will allow OEMs and smaller-scale “system builders” to pay as late as May 30, 2009, for copies of XP ordered by Jan. 31. (Vendors won’t have to pay Microsoft until the systems sell. MS previously had been expecting payments for copies of XP by Jan. 31.)

The details of Microsoft’s new, flexible inventory program were first reported on the ChannelWeb site.

Combine this news with reports that Windows 7 may ship as early as mid-2009, and it looks like Microsoft is ready to relegate Vista to the binary scrapheap. Maybe the company’s recent $300 million marketing push for Vista wasn’t so successful as Microsoft claims it was.

As Mary Jo Foley states in her All About Microsoft blog, vendors of low-budget PCs such as netbooks were already being allowed to sell new systems based on XP through June 30, 2010, or one year after Windows 7 ships — whichever came first. Microsoft’s new policy now gives a reprieve to builders of mainstream computers, and to end users who want to buy systems running Windows XP, not Vista, indefinitely or until Windows 7 is a proven commodity.

Will the Windows 7 RTM make an early entrance?

The official release of Beta 1 of Windows 7 to the public is widely expected to occur next week. If all goes well with the remaining testing, indications are that the final, RTM (released to manufacturing) version will be available as early as August. Lending support to this theory is the fact that the end-user license agreement of Beta 1, like all recent prerelease versions of Windows 7, states that the software will expire Aug. 1, 2009.

This feature — as well as the use of the product’s built-in slmgr -rearm command to extend the beta’s trial period without an activation key — was recently explained by Marius Oiaga of Softpedia. Other sources predict that Windows 7 won’t ship to OEMs until October 2009, becoming available to end users the following month.

Early reviews of the Windows 7 beta, such as those summarized by the Telegraph of London, variously describe the new operating system as being not much different from Vista or representing an unspectacular-but-solid improvement. If Windows 7 turns out to have better performance and reliability than Vista, as some reviewers believe, the OS may gain a measure of relieved acceptance from end users after only a few months on the market.

Paying a premium to downgrade from Vista to XP

The extended availability of XP on new PCs will gladden the hearts of many Windows users. For a few unfortunates, however, the XP option is coming at great cost.

Eric Krangel reports on the Silicon Alley Insider blog that Dell has gradually been inflating its surcharge for “downgrading” a PC from Vista to XP. The bite rose last June from U.S. $20 to $50, then spiked in October to $100, and now is a whopping $150.

The fact that Dell’s customers appear to be willing to pay this amount or more to avoid Vista may be the greatest indictment of Microsoft’s unloved OS.

The reality is that the Redmond software giant has been forced by popular opinion to provide customers with a Vista-free option — an extended life for XP — more than two years after Vista’s rollout. Depending on your point of view, this concession can be interpreted negatively as an act of desperation or more positively as a burst of marketing acumen on the company’s part.

As usual, the truth is likely somewhere in between.

Dennis O’Reilly is technical editor of WindowsSecrets.com. He was formerly a senior associate editor of PC World magazine.