WinInfo Daily UPDATE, February 27, 2004

Short Takes
- Some Questions Answered About Windows XP Reloaded
- And No, I Don't Know How You Can Get the Longhorn Beta
- Microsoft WMV 9 Gets Nod for HD-DVD
- So Much Money, So Little Time
- Microsoft Drops Unfair Contracts in Japan
- Longhorn to Offer Security-Monitoring Tools
- Xbox Next to Skip Hard Disk?
- EU Scales Back Microsoft Punishment to Make It Stick
- DOJ Files Suit to Prevent Oracle Takeover of PeopleSoft
- Web Predator Gets 30 Months in Prison
- Gates Tops Forbes List, but Buffet Is on His Heels
- Cold War Fun: United States Fought Russia with Software Bugs

==== Short Takes ====
An often-irreverent look at some of the week's other stories, by Paul Thurrott, [email protected]

Some Questions Answered About Windows XP Reloaded
I asked Microsoft to clarify the Windows XP Reloaded situation but the company isn't ready to discuss this product. (See http://www.winnetmag.com/article/articleid/41858/41858.html for my original report about XP Reloaded.) "We look forward to outlining all the details but at this time we don't have anything to announce," a Microsoft representative told me yesterday. But I think I can answer a few of the most common questions I've received. First, XP Reloaded will ship in late 2004 and will consist of free, downloadable consumer-oriented updates to XP. So if you're already an XP user, fear not; this release won't involve any Apple Computer-style upgrade price gouging. Microsoft won't rename the OS XP Reloaded; instead, the add-on kit for existing XP users will be called XP Reloaded (although that might not be the final name of the add-on kit, either). And no, XP Reloaded isn't XP Second Edition and won't be marketed as such. However, a new version of Windows Media Player (WMP) is part of the deal; we can expect to find out more about that release--and the other XP Reloaded components--in the coming months. Until then, Microsoft is more interested in concentrating on the security-oriented XP Service Pack 2 (SP2), which is understandable. Stay tuned.

And No, I Don't Know How You Can Get the Longhorn Beta
I can rarely identify the number-one email request I get, but these days the answer is pretty obvious. The request goes like this: "Hi, Paul; thanks for your site. How can I get the Longhorn beta?" Sadly, you probably can't--at least not yet--and here's why. First, Longhorn, the next major version of Windows, is currently in pre-beta (which used to be called alpha, but Microsoft actually refers to as "pre-alpha," which doesn't make sense) and is available only to a limited group of testers. The company gave Microsoft Professional Developers Conference (PDC) 2003 attendees build 4051, and Microsoft Developer Network (MSDN) Universal members can download that build now. Since build 4051, Microsoft has produced 10 to 15 more Longhorn builds but temporarily stopped daily builds in late December; that process is expected to ramp up again soon. We'll see a developer preview refresh build at Windows Hardware Engineering Conference (WinHEC) 2004 this spring and beta 1 in late summer. But if you haven't previously been a Windows technical beta tester, don't expect to see a publicly available Longhorn build any time soon. My sources tell me that Longhorn won't be generally available to the public until the beta 2 release, which isn't due until sometime in 2005.

Microsoft WMV 9 Gets Nod for HD-DVD
The DVD Forum has approved the popular Microsoft Windows Media Video (WMV) 9 format as a mandatory technology for any device seeking the high-definition DVD (HD-DVD) logo. In other words, to use the logo, next-generation DVD players and other DVD-playback devices must support WMV. This move is a huge coup d'etat for Microsoft, which is trying to get its video and audio formats accepted as industry standards, and for consumers, who'll be able to purchase more advanced DVD movies in the future as a result.

So Much Money, So Little Time
With a war chest of approximately $53 billion in cash, Microsoft is in an enviable position, but I have to wonder what its shareholders think about all that extra money lying around doing nothing. In fact, Microsoft's cash pile climbed an astronomical $10 billion in the past year alone and shows no signs of slowing. This week, Microsoft officials noted that the company will soon reveal its plans for the cash, which Microsoft has kept on hand largely to pay for antitrust-related lawsuits. With its most expensive payouts behind it, the software giant is now set to put that money to use. One obvious payout would be a larger shareholder dividend, which would likely be appreciated. Or maybe the company could reduce software prices by 10 percent. Just a thought...

Microsoft Drops Unfair Contracts in Japan
Rather than face yet another legal battle, Microsoft has agreed to drop the license provision that got the company into trouble with the Japan Fair Trade Commission (FTC). Microsoft said it would remove from its Windows licenses for Japanese computer makers a clause that prevents the companies from suing Microsoft, even if they discover that Microsoft is distributing their patented technologies. In typical Microsoft fashion, however, the company denied any wrongdoing, even as it changed its policy. "Microsoft believes that the patent-related provision is lawful under Japanese, US, and EU law," a company spokesperson said.

Longhorn to Offer Security-Monitoring Tools
Longhorn will include security-monitoring technologies that go well beyond similar, basic controls in XP SP2, which will ship later this year. In the Longhorn release, Windows will detect "irregular system behavior"--over the network or internally--and respond accordingly, Microsoft Chairman and Chief Software Architect Bill Gates said, calling the technology "Dynamic System Protection." This technology will also track which security patches have been installed, dynamically change the Windows Firewall configuration to fend off any detected attacks, and change network-adapter security settings when needed. The goal is to make sure Windows is as secure as it can be without requiring the user to fumble around trying to find and change settings. As with most helpful technologies of this nature, some detractors won't trust Microsoft to do the right thing, so I'll be interested in seeing how this feature develops.

Xbox Next to Skip Hard Disk?
According to various rumors, the next version of the Xbox (currently dubbed Xbox Next) will forgo a hard disk and instead use a less-expensive flash-based memory-storage scheme. Flash-memory-maker M-Systems' announcement this week that it will provide storage products for Xbox Next led to the rumors, but whether the company will simply make small, portable memory-storage units similar to the ones various companies (including Microsoft) ship for the current Xbox is unclear, and no one is providing any details. I guess we'll have to wait and see...

EU Scales Back Microsoft Punishment to Make It Stick
In a pragmatic move, the European Union (EU) will require Microsoft to offer a version of Windows without WMP only in Europe, fending off criticism that its antitrust case against the company will have ramifications in the wider global market. On a more important note, the limitation will make it more difficult for Microsoft to win on appeal because it removes one of the company's main arguments--that the European sanctions could be too far-reaching and affect Microsoft's global product development. Antitrust regulators from the 15 EU member nations will meet in mid-March to discuss the EU's ruling against Microsoft, after which time they'll finalize the remedy, which will likely include a fine of some sort. According to a draft version of the ruling, Microsoft violated EU antitrust laws twice--by tying its WMP to Windows and by withholding information about how competitors' software can easily connect to Windows Server products. Microsoft still hopes to settle the case, but time is running out: The EU will announce its final ruling and remedies by March 24 at the latest.

DOJ Files Suit to Prevent Oracle Takeover of PeopleSoft
The US Department of Justice (DOJ) filed suit this week to prevent database giant Oracle from completing a hostile takeover of PeopleSoft. The DOJ argued that Oracle's $9.4 billion bid for PeopleSoft would harm competition. Generally speaking, when the DOJ attempts to block a merger or takeover, the companies involved walk away from the fight. But this situation promises to be different (and therefore far more interesting). Oracle says that it will continue its fight and will challenge the DOJ's decision. "We believe that the government's case is without basis in fact or in law, and we look forward to proving this in court," an Oracle spokesperson said yesterday.

Web Predator Gets 30 Months in Prison
This week, a federal court sentenced a Florida man to 30 months in prison and 3 years of supervised probation for using misspellings of well-known Internet domain names to redirect users to pornography Web sites. Charged under the Truth in Domain Names Act, the man eventually pleaded guilty to 49 counts of using domain names to redirect children to sites featuring nudity or sexually explicit content (one example is the domain dinseyland.com, which is similar to the Disneyland Web site domain). After the sentencing, the man apologized to the adults and children he misled. Frankly, I think someone should jettison this guy into space, but hey, I don't run the country.

Gates Tops Forbes List, but Buffet Is on His Heels
Gates (worth $46.6 billion) is still the richest man in the world (whew, you're thinking, right?), but his buddy Warren Buffet, the investment guru from Omaha, Nebraska, is right on his heels with $42.9 billion and might soon surpass Gates. Eight of the top 10 billionaires are from the United States and five are from the Walton family, which owns Wal-Mart. Another Microsoft billionaire, cofounder Paul Allen, is in fifth place.

Cold War Fun: United States Fought Russia with Software Bugs
Given all the recent problems with computer viruses and worms, you might find the following tidbit interesting: In the early 1980s, Ronald Reagan approved a Central Intelligence Agency (CIA) plan to sabotage the Soviet Union's economy by covertly transferring to that country technology that included malicious bugs. One deliberate software error caused a massive explosion in a Siberian natural gas pipeline, according to recently unearthed reports. "The result was the most monumental non-nuclear explosion and fire ever seen from space," Thomas Reed, a member of the National Security Council at the time and author of the upcoming book "At the Abyss: An Insider's History of the Cold War" (Presidio Press, 2004), said. "While there were no physical casualties from the pipeline explosion, there was significant damage to the Soviet economy. Its ultimate bankruptcy, not a bloody battle or nuclear exchange, is what brought the Cold War to an end." And you thought those buffer overflows were no big deal.

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