Microsoft is aiming to get the final version of Windows XP out this winter, but if it misses its target, the sofware company may delay the operating system's launch until next year.
Much depends on whether the company can meet its target date for releasing the Windows XP final, or gold, code to computer makers. Computer makers contacted yesterday said that late last week Microsoft told them it would release the final code for XP - an upgrade to Windows 95, 98, Me and 2000 - in late July or early August.
If Microsoft meets that target, the company can launch Windows XP this year as planned. By releasing the software to manufacturers by the end of July, some PC companies could start selling it at the tail end of "the back-to-school" season, which is the second-busiest buying period of the year.
But Microsoft described its window for delivery as tight, telling several PC makers that if the date slipped, Windows XP's launch would be pushed back to 2002. Postponing it that long would also mean missing the busiest consumer shopping season, and the end-of-the-year budget blowout at corporations.
"Microsoft broke the news on Thursday or Friday last week that if (gold code) went beyond early August, they would hold back Windows XP until early '02," one PC maker said. "We were briefed at a fairly high level and exited the meeting with the impression all bets were off for this year."
The issue apparently revolves around Xbox and Microsoft's concerns that marketing for Windows XP could interfere with the gaming console's introduction.
"If they found themselves in a position where they were messaging on Windows XP and Xbox at the same time, they would give on XP," Guernsey Research analyst Chris LeTocq said. "Microsoft would push back XP until next year."
The date that Microsoft releases the final code to Windows XP is crucial for PC manufacturers, which typically take anywhere from four to eight weeks getting the software onto new computers. The later the delivery date, the more likely computer makers - and retailers selling shrink-wrapped copies of Windows XP - will miss the lucrative US holiday sales period.
Windows XP initially will ship in two versions: consumer and professional. Given how revolutionary the consumer upgrade is from earlier incarnations, "even early August doesn't give us much time for the holidays," one PC maker said. "Any later, and it's game over."
The issue is testing because computer manufacturers must certify the shipping version of Windows XP for a variety of PC configurations. The more lead time, the less likely PC customers will encounter troubles with the operating system later on.
The Xbox factor
Several PC makers expressed surprise that Microsoft would consider delaying Windows XP because of Xbox, but LeTocq said it makes sense.
"Do you want to be doing those two messages at the same time?" he asked. "Microsoft is betting a whole bunch on Xbox. If they can't get the Windows XP messaging out in time, that is a recipe for consumer confusion."
Piper Jaffray analyst Ashok Kumar agreed.
"They don't want to steal thunder from the Xbox announcement," he said. "Microsoft initially will be selling (Xbox) for about a US$150 loss per box." The company needs to get game developers and the gaming community excited as quickly as possibly to recoup part of its investment, he added.
