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Microsoft says the next version of Windows - the company's cash-cow operating system that powers the vast majority of the world's PCs - will include features it expects to appeal to cost-conscious New Zealand businesses.

The new iteration of Windows, branded Windows 7, is due to be released for general use by January next year, at which point it will replace its unpopular predecessor, Windows Vista, as the default system supplied to shoppers buying a new PC.

Vista, which has been in the market since early 2007, has proven to be a turn-off to many home and business computer users because of hardware compatibility issues in its early days and its poor performance on cheaper, low-powered PCs.

The backlash against Vista even forced Microsoft to extend the availability of its predecessor, Windows XP, which has been in the market since 2001 but remains the preference for many new PC buyers.

Feedback from Windows 7 test users, however, suggests the new version of the operating system has addressed the problems that plagued the Vista launch.

A beta, or test version, of Windows 7, has been available for public download since last month with the general consensus from users being that it is a solid, if unspectacular, improvement on Vista.

"Windows 7 is fairly unexceptional in the sense that, yes, it has some nice improvements over Windows Vista, but, no, none of them are particularly major changes," was IT journalist and blogger Paul Thurrott's summary.

"In this sense, Windows 7 is much like your typical Microsoft Office release, a nicely tweaked version of the previous release," he wrote in a review published on his website. "That said, Windows Vista is clearly in need of a spit-shine, not to mention a public execution, and Windows 7 will provide Microsoft with a way to do both."

Microsoft New Zealand last month demonstrated Windows 7 running effectively on a variety of computers including low-priced "netbooks" - small laptop devices which are increasingly popular with PC buyers.

Given the growth in sales of netbooks, many of which are now sold with competing Linux operating systems, Microsoft is under pressure to make Windows 7 an attractive option to install on the devices.

The company says it has improved the performance of Windows 7 relative to Vista, and reduced its demand for computing resources and memory, through numerous tweaks to the operating system's code.

Yesterday Microsoft released details of the different consumer and business-focused versions of the operating system it will be selling, at the same time scotching earlier rumours it could release a netbook-specific version of Windows 7.

The company said enhancements built into the new operating system "allow small notebook PCs to run any version of Windows 7, and allow customers complete flexibility to purchase a system which meets their needs".

It has not yet revealed any details of pricing for the Windows 7 options.

New features in Windows 7 include an overhaul of the operating system's "task bar" with the addition of large icons to launch applications. Microsoft has also introduced what it calls "jump lists" - a pop-up list of items and actions associated with a certain application.

Meanwhile a function called "Aero Peek" allows Windows 7 users to "peek" behind open windows on their desktop - a kind of souped-up version of "Show Desktop" button in XP and Vista, aimed at providing a more intuitive look at active applications.

Ben Green, Microsoft New Zealand's Windows client business group manager, said as well as improving the user experience for Windows users, 7's features should offer local businesses ways to improve productivity, cut costs, and reduce the time workers spend performing some PC tasks.

One of these features, he says, is "BranchCache," a system for locally storing and retrieving files which may be downloaded from a central server via a company network by several staff members all working at the same remote branch office.

"We think there is an opportunity here for productivity and cost savings for New Zealand businesses that have a lot of branch offices [and where] there are high bandwidth costs," Green said.

"In New Zealand we have a lot of branch offices, and in some cases not the greatest speed of connection. [High bandwidth expenses] are a cost to add to the business, so branch office caching will be pretty exciting for businesses in New Zealand."

Whether the caching feature - and other functionality such as improved security and support for the increasingly popular trend towards virtualisation - are enough to prompt businesses to rush deploy Windows 7 remains to be seen.

Green says Microsoft is pleased with the uptake of Vista which he says has now been installed by more than 10 per cent of New Zealand's large businesses and shows up as the operating system being used by a quarter of visitors to the country's busiest website, Trade Me.

"Two years after launch, given how long people hold on to PCs, we're really happy with the uptake of Vista. That said, the majority of computers out there are still [running] XP," he said.

"We know that Windows Vista is significantly more secure than XP in terms of vulnerabilities. Nevertheless there's a perception lingering around Vista."

It is a perception Microsoft will be hoping Windows 7 will change.

GIVE IT A GO

Operating system enthusiasts wanting to sample Windows 7 for free only have a week left to download the "beta" version for testing and feedback.

Go to www.microsoft.com/windows and click on the "Download the beta" link under "Windows 7".

Beta software is by definition less than perfect. Its aim is to give the developer feedback so improvements can be made and bugs fixed before the final version is released to customers. With that in mind Microsoft recommends users back up files and do not install the new operating system on "mission critical" computers.