I'm sure that Microsoft's change in heart was in part due to efforts like InfoWorld's Save XP efforts, which put names to over 200,000 users who don't want to move to Vista. I'm even surer though that what really changed Microsoft's mind is that Linux, and not Windows, was taking over the red-hot UMPC (Ultra Mobile PC) market.
Microsoft admitted as much in its announcement at the Computex trade show in Taipei, Taiwan that it would allow computer manufacturers to pre-install Windows XP Home on "low-cost desktops" through June 30, 2010. A Microsoft spokesperson told ComputerWorld that "One thing Microsoft has heard loud and clear, from both customers and partners, is the desire for Windows on this new class of devices [UMPCs, MID (Mobile Internet Devices), and net top devices]. It is important to Microsoft that they meet the needs of their partners and customers, and this is why the Windows XP Home offering is being extended to include net top devices."
Since when has Microsoft given a hoot about what its partners and customers wanted? Microsoft's own brass couldn't stand Vista and Vista sales have tanked, but Microsoft only quietly squeaks out the news about XP Home's new lease on life and Vista is what they're still pushing.
No, what has really happened is that the smashing success of Asus with its Eee Xandros Linux-powered UMPC and other Linux equipped mini-notebooks like Everex's gOS-powered UMPCs caught Microsoft completely by surprise. It turned out people wanted inexpensive, hard-working Linux laptops rather than overpriced, underpowered Vista PCs.
If anyone thought this was a flash in the pan, that Asus just hit it lucky once, they haven't been paying attention. Intel is putting big bucks into its Atom family of processors, which have been designed for UMPCs, or as Intel would have it, MIDs. Intel has encouraged both the computer makers and the Linux companies in its Moblin initiative to run desktop Linux.
The Linux companies have picked up on this. Canonical, Ubuntu's dad company, has come up with an UMPC-specific version of Ubuntu 8.04, the latest version of this popular Linux distribution, for Intel Atom UMPCs. At Computex, by my count, more than a dozen new UMPCs were announced both from vendors you've never heard of and from big name companies like Acer and Asus. You can also expect to see Dell releasing its 'mini-Inspiron' with Ubuntu by June's end.
So, Microsoft has been forced by the success of Linux and the UMPC to extend XP Home's life. What it can't do much about is the price. The Linux systems are cheaper, and, since they can work and play well with business networks, which is more than XP Home could ever do, I see them getting popular for business users.
Who knows? At the rate things are going maybe Microsoft will be forced to extend XP Pro's life as well. In the meantime, the Linux desktop is growing faster than ever and Vista is looking more and more like Microsoft's stupidest operating system release ever. Yes, even counting Windows ME and MS-DOS 4.0.