Windows Woes Have Microsoft On Defensive

There's been so much bad news for Windows lately, it's enough to give even a money-minting monopoly the blues.

Microsoft's big corporate customers are unhappy about the lag between releases. CEO Steve Ballmer has been issuing mea culpas, most recently at a July meeting with financial analysts on Microsoft's Redmond, Wash., campus. "We will never repeat our experience with Windows Vista again," Ballmer said. "We will never have a five-year gap between major releases of flagship products." Customers don't want to digest a new operating system every year, Ballmer said, but they don't want to wait half a decade, either. Wall Street hasn't revalued Microsoft's stock for years, keeping its share price in limbo as the pace of innovation in its flagship product slowed.

Security problems continue to dog Windows, four years after Microsoft revamped its entire engineering process to prevent leaky Microsoft code from dragging down its customers' data centers--and Microsoft's reputation. But the bug fixes are still coming fast and furious. Just last month, Microsoft patched 23 vulnerabilities in Windows and Office, flagging 16 with its most critical rating.

Meanwhile, Apple, whose R&D budget is about a tenth of Microsoft's, is making Vista look dated before it even arrives. Apple's Mac OS X is considered leaps and bounds ahead of Windows XP and includes many features, such as workable desktop searching and automatic RSS feeds, that won't arrive in Windows until Vista.

Return to main story, In Depth: The Next Windows After Vista Will Demand Radical Rethinking From Microsoft