Microsoft Rushes Windows XP Gold

Microsoft is set to hand off the final version of Windows XP to eagerly waiting PC makers today in a ceremony filled with bells, whistles, and possibly helicopters.

The plan is to have representatives from all the major PC manufacturers — Dell, Compaq, Hewlett-Packard, IBM, and Gateway — to step off helicopters draped in banners carrying each vendor's logo, vendor sources said. Microsoft Chairman Bill Gates will then personally hand the representatives their own copies of the final, or "gold," version of Windows XP.

Computer makers will use the gold version to install Windows XP on new PCs. The new operating system is expected to ship to retail customers on October 25.

The Microsoft PR machine was in overdrive to prepare for the event, which is expected to take place at a soccer field near the company's Redmond, Wash., headquarters. The company would not comment on plans for the event.

Hoopla aside, Microsoft is expected to begin shipping the gold version of the Windows XP operating system code to all PC manufacturers today.

Earlier this week, Microsoft CEO Steve Ballmer said he expected the final version of Windows XP to be finished this week. Speaking at a technology conference in Sao Paulo, Brazil, Ballmer said he expected XP would be ready today and that production of new systems with the software could start as early as Monday.

Gold Rush

The new operating system could not come soon enough for a technology industry suffering one of the worst slowdowns in history. High-tech industry executives and analysts are looking for Windows XP to help kick-start consumer and corporate spending on PCs and related peripherals.

"Microsoft will deliver the gold on Friday," said Alan Weinberger, chairman and CEO of TechnologyNet, an industry buying consortium. "The quicker they can get Windows XP out, the faster they can help the business and the industry."

Most industry executives and analysts are hopeful that Windows XP will give a boost to the sagging PC industry in the fourth quarter of this year. Corporations are expected to begin upgrading to the new operating system beginning in the first quarter of next year.

Microsoft has been under pressure from lawmakers, privacy groups, and other industry heavyweights regarding the contents of the new operating system. Some industry analysts even speculated that the company is trying to get out the final version of Windows XP before the U.S. Department of Justice can intervene.

"If the release of Windows XP gets slowed down, it will not be good for the industry," said John Venator, president and CEO of CompTIA, an industry association. "Some folks, like the PC guys and certain users with certain applications, really need this upgrade."

Showdown With a Senator

Senator Charles Schumer, D-New York, has been the most outspoken lawmaker regarding Windows XP. Schumer wrote a letter in late July to Judge Charles James of the Justice Department's Antitrust Division requesting that the government's ongoing settlements with Microsoft include Windows XP in order to delay the launch date.

In the letter, dated July 29, Schumer said, "In building Windows XP, Microsoft appears to have hard-wired preferences for Microsoft applications over those produced by competitors. It seems that Microsoft intends to maximize its monopolistic power, using XP to enter new lines of businesses — such as digital photography, media players, and messenger services — while limiting the choices consumers have."

One company that supported Schumer's claims at that time was Kodak. The company said its own EasyShare digital photography system and service were not bundled with Windows XP in order for Microsoft to push its competing products.

Since then, Microsoft has made some concessions and decided to add more functionality to Windows XP in order to make it easier for users to use Kodak's EasyShare system while running the new operating system.

Privacy Matters

But the attack on Windows XP does not end there.

Privacy groups also have attacked the forthcoming operating system and have asked the Federal Trade Commission to force Microsoft to make changes to it. With their second formal complaint in less than a month, the privacy groups claim Microsoft is engaging in unfair and deceptive trade practices and violating FTC regulations.

The privacy watchdogs are especially concerned about Microsoft's Kids Passport feature, which they claim violates the Children's Online Privacy Protection Act.

In response, Microsoft said it wants to gain the trust of its partners and customers and it takes privacy very seriously.