10 Predictions For Microsoft In 2008

1. Microsoft will extend the February 2009 system builder deadline for Windows XP Professional.

In a sign of the still-strong demand for Windows XP, Microsoft in September extended the deadline for sales of new direct OEM PCs with XP installed from Jan. 31, 2008 to June 30, 2008. Many system builders expect (and hope) that the vendor will soon decide to extend their current Jan. 31, 2009 deadline by at least six months.

Microsoft has come a long way in terms of listening to what their customers and partners want, and it wouldn't be surprising to see them extend the system builder deadline for XP, said John Kistler, principal at J&B Technologies, a St. Louis-based system builder. "Microsoft is now really in tune with its customers' and partners' needs," he said.

2. Windows Genuine Advantage will continue to cause grief for users

WGA is designed to combat piracy by installing software on users' PCs that periodically checks to see if their copies of Windows are authentic before allowing them to download updates. But in 2007, technical glitches and human error caused at least two major incidents in which thousands of Windows users were mistakenly identified as software pirates.

The glitches were hardly surprising, though, as WGA has been a source of much frustration for customers and partners ever since Microsoft introduced it in 2005. Microsoft in January acknowledged that since it was launched, WGA had flagged more than a fifth of Windows users attempting to validate their copies of Windows, but that the rate of WGA false positives was less than one-half percent.

Microsoft recently said its WGA team has changed the way it rolls out updates to the back-end servers and has also been fortifying the infrastructure on which WGA is based. But given WGA's history, customers and partners that believe that false positives are a thing of the past are probably also planning to leave cookies out for Santa on Christmas Eve.

3. Microsoft will continue to cause insomnia for VMware executives

When Microsoft unveiled the public beta for its Hyper-V virtualization hypervisor last week, shares of VMware plummeted. If a beta release can have that sort of impact, the arrival of Hyper-V, currently slated for 180 days after the launch of Windows Server 2008, will have an even stronger effect, according to some Microsoft partners.

Microsoft plans to spark widespread adoption of its virtualization products through competitive pricing, and is positioning virtualization as a key feature of Windows. Ron Herardian, president of Global System Services, a Mountain View, Calif.-based solution provider, expects Microsoft to successfully take market share away from VMware through licensing and by tying virtualization to Windows.

"Microsoft, just by announcing Windows Server 2008 and Hyper-V, is freezing the market. If Microsoft announces it will be embedding virtualization and providing attractive licensing terms, people are going to wait," said Herardian.

Chris Amaris, CTO at Convergent Computing, an Oakland, Calif.-based solution provider, said next year will be when customers begin to ponder the question of whether to stick with VMware or go with Hyper-V. And since the Microsoft offering is going to have a better price point, "that's how they're going to get their foot in the door," said Amaris.

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