This story about XP being extended for some classes of systems is interesting - not so much from the "Vista Fails" standpoint, as from the "did MS miss this boat?" standpoint:

Microsoft said on Thursday that it will continue to allow Windows XP Home edition to be sold for a class of computers it calls "ultra-low-cost PCs." It's a category that covers machines with slower processors, smaller screens, and in many cases flash memory for storage, rather than a traditional hard drive.

So the bottom line is, I think MS just missed the advent of smaller devices. Apple is on top of this with the iPhone (yes, I know about Windows Mobile - but Apple seems to have kept things more consistent at the OS level with OS X). The next couple of years should be interesting ones in the smaller device space.

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