Microsoft

Microsoft has halted distribution of a tool aimed at making it easier to put Windows 7 on Netbooks amid allegations that the utility makes improper use of open-source code.

The software maker said on Tuesday that it has pulled down the Windows USB/DVD Tool while it investigates the issue, which was raised last week by Windows blogger Rafael Rivera on his Within Windows blog.

In his blog post, Rivera said Microsoft appears to use code from a tool called ImageMaster that is licensed under the GPLv2 open-source license. The General Public License, like other open-source licenses, allows code to be freely used by others, but has its own set of terms and conditions, such as sharing any modifications made to the code.

Microsoft confirmed it has launched a review of the matter and taken the utility off its online Microsoft Store until that inquiry has been completed.

"Microsoft is looking into this issue and is taking down the (Windows 7 updating) tool from the Microsoft Store site until its review is complete," the company said in a statement. "We apologize to our customers for any inconvenience."

Though somewhat arcane, the utility is important because it solves a technical challenge in upgrading the operating system on Netbooks and other PCs without an optical drive.

Microsoft had been exploring for months different ways of trying to help users of Windows XP-based Netbooks move to Windows 7. The tool, which was released last month alongside Windows 7, allows users to take a downloadable copy of the operating system and create a bootable drive.

The issue is also a thorn in Microsoft's efforts to show that it can play nice with the open-source community. As ZDNet blogger Mary Jo Foley notes, this isn't the first time Microsoft has been accused of misusing GPL code.

The latest dust-up comes as Microsoft is celebrating the third anniversary of its deal with Novell, one of Microsoft's biggest--and most controversial--efforts to blend its world with the open-source world.

Under that deal, Microsoft agreed not to sue Novell customers for their use of its Linux distributions.

Microsoft has also released a number of products under various open-source licenses itself, though typically not under the GPL, which it sees as one of the more restrictive licenses. Redmond has been particularly critical of terms in version 3 of the GPL.

The software maker did release a few Linux drivers under GPLv2, although it appears its hand may have been forced there. Some have suggested the drivers contained GPL code, meaning that they would have necessarily needed to be released back under the GPL.

Microsoft has taken a number of different approaches to open-source software, particularly Linux. The software maker has at times accepted the notion of a heterogeneous world where Linux and Windows co-exist, pledging to do better to make sure IT administrators can manage mixed environments.

At other times, Microsoft executives have lashed out, painting open-source software as violating hundreds of Microsoft patents. In its lawsuit against TomTom earlier this year, Microsoft for the first time made those accusations in court, alleging that TomTom's implementation of Linux in its GPS systems infringed on Microsoft patents. The two companies quickly settled the matter, although terms were not disclosed.

Microsoft made two enterprise moves on Monday, one expected and the other a bit of a surprise.

As promised, the company used its TechEd event in Berlin to release Exchange 2010, the latest version of its e-mail and calendar server software. Microsoft finalized the code for the product last month and had said it would launch at TechEd.

Meanwhile, the company also announced it is buying the Teamprise technology from SourceGear. Teamprise allows developers using Eclipse and those working on non-Windows operating systems to build applications using Microsoft's Visual Studio product.

"We know our customers face daily challenges with management, collaboration and development in heterogeneous environments. The industry must take steps to make interoperability a stronger business asset for our customers," senior vice president and developer unit head S. Somasegar said in a statement. "With the acquisition of the Teamprise assets, we're taking a step forward on this journey, providing customers with a viable cross-platform development solution that will help produce business results more quickly."

Microsoft didn't announce financial terms of the deal, but did say the Teamprise technology will be integrated into Visual Studio 2010.

At TechEd Europe, Microsoft also talked about enterprise adoption of Windows 7 and Windows Server 2008 R2, highlighting some early customers of the two products.

"We remain just pleased and humbled by the very warm reception we're seeing," Microsoft vice president Tami Reller said in a Webcast on Monday.

As part of the same Webcast, senior vice president Chris Capossela sounded off on Cisco's announcement of updated collaboration tools that could take on Exchange.

"Rather than stitching together acquired products and calling that a solution, we've built Exchange form the ground up," he said.

Judging by its initial sales, Windows 7 is certainly proving more popular than Vista.

Credit: Microsoft

Microsoft sold 234 percent more boxed editions of Windows 7 than it did Vista in the initial releases of both products, according to research released Thursday by NPD Group.

In actual dollars, Windows 7 has also been more successful than Vista. However, early discounts on pre-sales copies and a lack of a promotional boost behind Windows 7 Ultimate led to revenues only 82 percent greater than those of Vista.

"Ultimate was a much bigger part of what Microsoft did with Vista, whereas this time I think they not only kept the price very high, but really kept the focus on the Premium product and the Premium three-pack," explained the author of the report, NPD's Stephen Baker, to CNET News. "Most of the promotional fire that they've put out there has been focused on those, for example, 'Buy a computer, get a $50 copy of Home Premium.' The pre-sales were all pretty much focused on Home Premium."

The numbers provided by NPD include both the initial sales of Windows 7 following its release on October 22 and pre-sales data from the discount program that Microsoft launched in July.

NPD declined to release actual sales figures for Windows 7, but the percentages help tell the story.

Web statistics firm Net Applications also found early adoption of Windows 7 to be strong.

Sales of PC hardware running the new OS didn't fare quite as well. Though growth in PC sales for the Windows 7 launch was at its highest level for the entire third quarter, it wasn't as strong as during the Vista launch, showing a 6 percent decrease from Vista's initial days.

A mixture of different factors affected the sales of Windows 7 PCs, notes Baker. Vista was launched in January, which traditionally offers a better sales environment than October. Also, the new OS was hurt by sales of PCs with older operating systems, which made up 20 percent of all sales during Windows 7 launch week. In contrast, PCs with older operating systems made up just 6 percent of all sales when Vista hit the market.

Baker doesn't think the current recession had a bearing on the lower PC sales for Windows 7's launch. "We've seen pretty strong sales growth on computers all year regardless of the recession," he said. "People have been buying more units of PCs all year than they had in 2008. At least from a unit perspective, we haven't really seen much impact on the consumer PC market from the recession."

When I wrote on Monday about the ins and outs of what counts as proper licensing of Windows 7, I was worried that it might turn into a flame war. But, instead, readers sent in a whole bunch of really good questions on the intricacies of licensing Windows 7 that went beyond the basics I had covered.

Things like dual-boot machines and systems with beta versions of the operating system raise all sorts of interesting licensing challenges.

Before we dive into the edge cases, though, here's a recap of the basics on Windows 7.

For those upgrading their PC, they can choose from Home Premium, Professional or Ultimate editions. There is also a family pack that includes three upgrade licenses for Windows 7 Home Premium.

Many people will have to do what is known as a custom or "clean" installation, which involves backing up one's data, installing Windows 7, then restoring the data and re-installing all applications.

All users of XP will have to go this route, as will those moving from a 32-bit version of Vista to a 64-bit version of Windows 7 (or vice versa), as well as those who are moving from a higher-end version of Windows Vista to a lower-end version of Windows 7.

Those moving from Windows Vista to the same version of Windows 7 (or to Ultimate) can do what is known as an "in-place" upgrade, which preserves files and applications.

Anyway, on to the tough cases. Here are some of the questions that readers sent me, as well as the answers I heard back from Microsoft.

Q: I installed the release candidate version of Windows 7 on a reformatted hard drive that previously had Windows Vista installed. Can I use the Windows 7 Home Premium Upgrade version to install a licensed copy?
A: Yes. You can do a custom installation ("clean install") to Windows 7 using the upgrade. The Windows 7 installer will detect you have the RC installed, enabling you to do this.

Q: Try as I might, I haven't been able to find any reliable information on whether I can upgrade from Vista Home Premium Edition (that came with my HP Laptop) straight to Windows 7 Professional/Ultimate, or whether it is only possible to upgrade from "Vista Home Premium" to "Windows 7 Home Premium."
A: You can do an in-place upgrade from Home Premium to Ultimate, provided you aren't switching from 32-bit to 64-bit or vice versa. Going from Home Premium to professional, however, requires a custom installation. (For a chart of which versions can be done via in-place upgrades, check out this Microsoft Web page.)

Q: I have Vista Basic on two computers and XP on the other one. So all I would have to do is use a Windows 7 upgrade disc on all three computers? Does one disc do one computer or will it do all three? I live in Canada, not the U.S.
A: In both the U.S. and Canada, your best bet is probably the Windows 7 family pack, which offers a license to upgrade up to three PCs.

Q: Can you use an upgrade disk to run XP (or Vista) in dual-boot (meaning that one partition or hard drive has the older operating system and the other partition or drive has Windows 7?
A: Microsoft treats a dual-boot machine as if it were two PCs, so you can only use the upgrade if you are installing over an existing Windows partition. So, unless you have two licenses already on that system, you will need a full copy of Windows 7.

Q: What about upgrading a Mac?
A: In order to qualify to use the upgrade version, Mac owners need to be running a previously licensed full copy of Windows (not just a beta version). That applies whether one they are using Windows in Boot Camp or using a virtualization product like Parallels or VMWare's Fusion.

We've seen slides and videos of Microsoft's Courier dual-screen booklet in action, but nothing has quite explained how all of these things actually work. This document explains Courier's interface, gestures, and features more in-depth than ever before.

This story originally appeared on Gizmodo.

Microsoft said on Wednesday that it is notifying approximately 800 workers that their jobs are being eliminated as the software giant completes the layoffs it announced earlier this year.

In January, Microsoft said it would cut approximately 5,000 positions before the end of the next fiscal year, which ends in June. With the latest cuts, Microsoft said it has essentially completed those layoffs. Microsoft CEO Steve Ballmer said in May that it was mostly, but not entirely, done with the job eliminations.

Actually, though, the latest cuts will push Microsoft past that 5,000 number. Once these cuts are made, it will have eliminated approximately 5,800 jobs since January, said Microsoft spokesman Lou Gellos.

Wednesday's job cuts were spread across multiple businesses and around the globe, Gellos said. Microsoft didn't announce any specific products that are getting the axe as a a result of Wednesday's cuts, although it has cut a variety of products in recent months, including Microsoft Money, Windows Live OneCare and, just this past week, its small business accounting product line.

There could also be additional cuts, even as Microsoft does some hiring in key areas. Although January's layoffs were the company's first across-the-board cuts, it regularly reviews its businesses and makes adjustments as necessary, Gellos said.

"We'll manage our businesses closely and do the things that we need to do," Gellos said.

Update 12:05 p.m. PT: As noted by TechCrunch and others, among those let go on Wednesday was Don Dodge--one of Microsoft's key voices in Silicon Valley and a director on the company's emerging business team. Dodge wrote about the turn of events on his personal blog Wednesday.

Aiming to stay relevant, Microsoft is introducing a new look for its MSN.com home page.

Although MSN gets far less attention than the company's Bing or Windows Live efforts, the home page remains an important economic engine for Microsoft's online business, as well as a significant source of search traffic for Bing.

"We believe it's an important asset for Microsoft," said MSN general manager Bob Visse.

The site is still the top portal in about 25 of the 46 markets, with about 600 million unique users globally and 100 million in the U.S, where it trails Yahoo in popularity.

The redesign, which has been in the works for months, bears quite a bit of resemblance to the one that Microsoft had been testing in France.

Microsoft late Tuesday began rolling out the new MSN home page (click for preview), which it says will become widely available in the U.S. early in 2010.

With its new look, the home page has about half as many links as the previous incarnation, focusing instead on a few categories, such as video, news, shopping, and search.

The old site had dozens of text links at the top and bottom of the page for everything from horoscopes to white pages to a free trial of MSN's dial-up Internet service.

"It doesn't take a rocket scientist to see this is a very cluttered and busy site," Visse said of the existing page.

The company has, in the past, tried to make changes that its users saw as too radical, such as a 2007 overhaul of Hotmail that the company was forced to significantly scale back. Visse said he isn't as worried about that, given that users were already complaining that the site was both dated and overstuffed with links.

"We were, frankly, at a point where customers are complaining about the clutter," he said.

Microsoft is also trying to tap into the popularity of social networks, adding a column on the right-hand side that lets users peek at their Windows Live, Twitter, and Facebook feeds, and even update their status or post a tweet. As before, users can also see a preview of their Hotmail in-box.

But it will take its time in jumping on the Web apps bandwagon, with plans to offer several Silverlight-based apps on the right-hand side of the redesigned page at a later date. In the past, MSN users have not customized their pages to a large degree, and so Microsoft is going to take a wait-and-see approach before it decides whether it will roll out more apps than the Windows Live, Twitter, and Facebook apps available at launch.

By contrast, Yahoo, perhaps MSN's largest competitor, has bet the farm on the popularity of Web apps on the home page, redesigning the entire Yahoo experience with that in mind. It's still early, but since the redesign went live Yahoo has seen a 20 percent increase in the amount of time spent on the home page, it said last week.

The company has decided to scrap altogether a more radical overhaul that it tested in Brazil. That site, geared towards Brazil's highly social online population, allowed people to share videos by dragging the video screen onto a contact in one's social network.

"It was too radical, even for that audience," Visse said. "It's not going to ship for a final release."

MSN was among the Microsoft units hit by companywide layoffs earlier this year, but things have stabilized, Visse said.

"I wouldn't say we are growing headcount, but we aren't reducing," he said.

Correction, 6:35 a.m. PDT: This story initially gave an incorrect launch date for the new MSN home page.

Microsoft said Monday that it's cutting by a third the subscription prices for the hosted versions of Exchange, Sharepoint, and Office Communications Server.

The software maker plans to cut the monthly per-user cost of licensing all three products from $15 to $10, while the cost of licensing individual products is also dropping by as much as 50 percent. The move comes as Microsoft faces continued pressure from rivals, including Google.

Last week, the city of Los Angeles voted to go ahead with a deal to shift many employees to Google Apps from Microsoft Office.

In an interview, Microsoft Vice President Chris Capossela said the move has less to do with competitive pressure than that "it's the price that customers are really excited to buy our suite at."

,p> "We're pretty excited about the price and not so much focused on free services or the price Google or others might charge," Capossela said.

In addition to the price drop, Microsoft is also touting several new customers and announced its plan to bring the year-old Microsoft Online services to more than a dozen new countries.

The company is announcing its commercial launch in Singapore, as well as trials in Brazil, Chile, Colombia, Czech Republic, Greece, Hong Kong, Hungary, Israel, Malaysia, Mexico, Puerto Rico, Poland, Romania, and Taiwan. Microsoft also expects to have commercial availability in India later this year.

Among the new customers are McDonalds, Aon, Lions Gate Entertainment, and Rexel Group. They join existing customers, such as Blockbuster, Coca-Cola and Autodesk as those paying Microsoft to run hosted versions of its products. Microsoft formally launched Microsoft Online at a San Francisco event a year ago.

Next week, Microsoft will also formally launch Exchange 2010 at its TechEd Berlin developer event. Microsoft said last month that it had finalized the product. Traditionally, Microsoft has developed products first as a server and only later, if at all, customized them to run in hosted form.

Exchange 2010, though, was designed first as an online service and then crafted into a product that businesses can run on their own servers.

There's a bit of a tempest in a teapot brewing over what one can and can't do with a Windows 7 upgrade disk.

My hope with this post is to help things simmer down as opposed to boiling over, but we'll see. So here goes.

The upgrade version of Windows 7 (as opposed to the higher-price full version) lets one move from any properly licensed version of Windows XP or Windows Vista to Windows 7 on that same computer. Only certain of these upgrades, however, can be done as a simple update--what Microsoft calls an "in-place upgrade." Users moving from Windows XP, switching from 32-bit to 64-bit versions, or moving from a higher-end version of Vista to a lower-end version of Windows 7 can use an upgrade disc but will have to do a more cumbersome upgrade, known as a custom, or "clean," installation.

The difference between an in-place upgrade and a "clean" installation, in this instance, means backing up one's data, installing Windows 7, restoring the data, and reinstalling all Windows programs. Windows 7 upgrade disks can be used to do this clean installation and will recognize the previously installed version of Windows. So if you don't have any previously installed Windows on the machine, you will want to get yourself a full copy of Windows 7.

While it might be technically possible to use the upgrade disks to do an installation of Windows 7 without a previous version, doing so, as Microsoft points out, is not properly licensed.

Some of the confusion has come after enthusiasts noted a way to get an upgrade disc to install on a fully erased hard drive.

Again, the main issue here is whether one is properly licensed to do so. If you have a licensed copy of Windows XP or Vista for that computer, you are good to go, and Microsoft technical support should be able to help you activate that machine. If not, you may be able to get it to install, but you could well run into technical or legal hurdles.

I think that ZDNet blogger Ed Bott put it well in his post on this topic:

The answer is really simple. If you qualify for an upgrade license, then yes, you can use any number of work-arounds to install the operating system legally. If you don't qualify for an upgrade license, then those same workarounds might technically succeed, but your license is not valid.

Will you get away with it? Probably. But if you're running a business, you run the risk that an employee will turn you in to the Business Software Alliance, which could lead to an audit, civil charges, and eventually some stiff penalties.

It should also be pointed out that beta test and pre-release versions of Windows don't count as a previously licensed version of Windows, but if you have the RC installed over a previous version, for example, you can do a custom upgrade rather than having to reinstall XP or Vista before installing 7. (The upgrade version can detect the previous versions used before Windows 7.)

Nor is it allowed to count the version of Windows that came installed on a previously bought PC, if that's not the machine you're upgrading. (Retail boxed copies can be transferred from one machine to another; ones that came pre-installed on the PC are licensed only for that machine.)

This is also relevant to Mac users who want to run Windows 7 on their machines. Such users also need to have a previously licensed full copy of Windows to properly qualify for upgrade pricing, whether they are using Windows in Boot Camp or using a virtualization product like Parallels or VMWare's Fusion.

I hope that this overview helps more than it adds to the confusion. Either way, please let me know.