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April 21, 2006

WinInfo Short Takes: Week of April 24

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- Exclusive: Windows Vista Interim Build, Beta 2 Update

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Short Takes
 
   - Microsoft Ships First SQL Server 2005 Service Pack
   - Microsoft Preps Live Drive Service
   - Apple Financials Betray Softening of iPod, Mac Sales
   - Opera 9 Beta Ships
   - No Surprise, But Visual Studio Express Editions Are Free Forever
   - Microsoft to Re-release Buggy Patch
   - Microsoft Denied IBM Documentation in EU Case
   - eBay Considers Microsoft-Yahoo! Partnership to Fend Off Google    
Juggernaut
  
  
       by Paul Thurrott, thurrott@windowsitpro.com

Exclusive: Windows Vista Interim Build, Beta 2 Update

Last week, I reported that Microsoft was preparing a Windows Vista
interim build to deliver to beta testers and Technology Adoption
Program (TAP) partners. That build has been delayed, but it's still
coming: Microsoft now plans to ship Vista build 5365.8.060419-1800
today.

Curiously, after posting my report last week, several other Web sites
posted information about an interim build, including screenshots
purporting to be of Vista build 5361. I don't have any information
regarding the validity of the reports, but I can tell you that build
5365 is still being delivered today. This will be the last interim
build before Beta 2.

"We are considering releasing updated Windows Vista code to Windows
Vista Technical Beta program participants as well as select TAP
customers, but do not have a date to share at this time," a Microsoft
representative confirmed. "As you know, in addition to the CTPs, we
sometimes provide a select group of testers with current prerelease
versions of Windows Vista based on their feedback and testing needs.
These builds are not CTPs. As we have said, the next CTP will conclude
the Beta 2 process and will be called Beta 2. We are on track to
deliver Beta 2 in the second quarter of this year."

According to my sources, build 5365 will include major changes to the
User Account Protection (UAP) feature. UAP is now linked to something
called "Secure Desktop," which is what the Ctrl+Alt+Del keyboard
shortcut will trigger as well. Microsoft changed the behavior of UAP to
bypass a potential flaw in the original implementation. It's unclear
whether such a major change will cause any further delays in Vista's
schedule.

Other new features in build 5365 include major changes to Windows XP
Backup and the Windows Recovery environment. The virtual folders and
saved searches functionality are further deemphasized and drop almost
all support for keywords.

Microsoft is also preparing to finalize Vista Beta 2 (currently set to
be build 5372) on May 22, two days earlier than scheduled. Microsoft is
planning to distribute Beta 2 at the Windows Hardware Engineering
Conference (WinHEC), which is being held the same week in Seattle.

For more information about Vista, check out the conclusion to my Vista
February CTP/Build 5342 review, "Where Vista Fails," in which I point
out the various broken promises and missing features that make Vista a
disappointing upgrade.
http://www.winsupersite.com/reviews/winvista_5308_05.asp

==== WinInfo Blog ====

   by Paul Thurrott, thurrott@windowsitpro.com

Something astonishing happens to me almost every time I go on a trip:
In the days leading up to the trip, I begin preparing my laptop with
all the applications and data I'll need. Then, the day before the trip-
-usually, late the night before I leave--something will go wrong with
my laptop. This just happened. While I was preparing for a trip to
Phoenix, Arizona, this week, my laptop began acting strangely. Outlook
would hang when I tried to import my desktop's system mail file and
FrontPage would crash when I tried to load the local version of my Web
site. I considered taking a second computer just in case, but then I
started reading about Microsoft's buggy MS06-015 patch. Could it be?
Sure enough, I had loaded HP scanner drivers on the system, and
removing MS06-015 fixed the problem. So I guess I have mixed feelings
about this: I was actually hit by a buggy Microsoft patch, which I
don't appreciate, but at least I was able to get it fixed before I
left. And sure enough, the laptop has worked great on the road.

Today, Microsoft will ship an interim build of Windows Vista, build
5365.8.060419-1800. It will go out to beta testers and Technology
Adoption Program (TAP) partners. When I first wrote about build 5365
last week, a bout of stupidity ensued. First, a site published a bunch
of screenshots allegedly of build 5361. Then, another site claimed to
have news about an interim build that was shipping "any day now"
(ahem). So the Windows enthusiast sites all linked to those stories
instead of to the WinInfo article that was out hours (or in the second
case, days) earlier. OK, fine. But then people started claiming that
build 5365 wasn't coming and that the build 5361 screenshots from the
first site were fake. (Which they could be, I guess. I don't know.)
Meanwhile, I've got people emailing me wondering why I'd publish a
story about a build that I clearly made up. Because, you know, that's
the kind of thing I do. Folks, if I publish a build number that comes
from sources within Microsoft, it's real. If the build doesn't happen,
as in the case of build 5365 last weekend, it's because something went
wrong internally at Microsoft. This week, build 5365 will finally be
released. I don't invent information and I guess I sort of resent the
accusation.

Speaking of Vista, my "When Vista Fails" article on the SuperSite for
Windows has generated a lot of discussion inside and outside of
Microsoft. This might sound disingenuous, but I'm almost always
surprised when that happens. I looked at this article as nothing more
than the fifth and long overdue final part of my Vista build 5308/5342
review. I wanted to finish it before the next interim build hit, but I
figured out last week I'd have to incorporate build 5365 into the
review as well. Most of the feedback has been highly complimentary, but
a few people have wondered whether I purposefully wrote something
antagonistic in a bid to attract readers. I wish I had that much
forethought, but the truth is I almost never correctly gauge what it is
that people want to see. If I had planned this as some explosive
exposé, I guess I would have published it separately from the review.
Maybe I'm overthinking this.
http://www.winsupersite.com/reviews/winvista_5308_05.asp

==== Short Takes ====

An often irreverent look at some of the week's other news

   by Paul Thurrott, thurrott@windowsitpro.com


Microsoft Ships First SQL Server 2005 Service Pack

This week, Microsoft shipped SQL Server 2005 Service Pack 1 (SP1), the
company's first major update to its latest database server. That's a
pretty impressive time-to-market accomplishment too, considering how
long SQL Server 2005 took to release. SP1 includes a "production ready"
version of Database Mirroring, the new SQL Server Management Studio
Express (SSMSE), and numerous other updates. Visit the Microsoft Web
site for more information and the free SP1 download.
http://www.microsoft.com/sql


Microsoft Preps Live Drive Service

Microsoft is working on an Internet-based virtual hard drive hosting
service called Windows Live Drive, which will compete with Google's
GDrive, according to Microsoft CTO Ray Ozzie. Windows Live Drive will
offer users "huge amounts of online storage" that the company says will
be accessible from anywhere, on any device. That's not very hyperbolic
compared to Google's description of GDrive, which promises "infinite
storage and infinite bandwidth." Now that's a promise.


Apple Financials Betray Softening of iPod, Mac Sales

This week, Apple released its quarterly earnings figures and the news
wasn't good. Although profits were up 41 percent or $410 million, year-
over-year for the quarter ending March 31, Apple's revenues fell short
of analyst expectations. More important, iPod and Mac sales growth has
fallen dramatically. This quarter, iPod sales grew 61 percent, but that
pales in comparison to the 558 percent growth the company experienced
last year. iPod sales were also lower than expected: Apple shipped 8.5
million iPods in the first quarter, not the more than 9 million
expected. Mac sales were even less impressive: Year-over-year, Mac
sales grew only 4 percent to 1.11 million units. That's slower growth
than the PC industry as a whole, and much lower than the 43 percent
gain the company made the same quarter last year. Have Apple's products
leveled out? It's starting to look that way.


Opera 9 Beta Ships

This week, Opera Software announced the first public beta of Opera 9,
its upcoming Web browser. Opera 9 features Widgets, which are mini-
applications that can run alongside the browser, and support for the
BitTorrent peer-to-peer downloading technology. Opera 9 also includes a
content blocker for removing ads and images, customizable integrated
search functionality, and thumbnail previews of pages and videos hidden
in various browser tabs. Opera 9 will be finalized later this year,
Opera Software says. Visit the Opera Web site for the free download of
Opera 9 Beta.
http://www.opera.com/index.dml


No Surprise, But Visual Studio Express Editions Are Free Forever

When Microsoft announced the availability of its free Visual Studio
2005 Express editions last November, the company said that the editions
would be free to customers for the first year. Surprise! They're really
free forever! What, you're not surprised? Well, fine then. This week
Microsoft revealed what everyone pretty much knew to begin with: The
Visual Studio 2005 Express editions--including Visual Web Developer
Express, Visual Basic Express, Visual C# Express, Visual C++ Express,
and Visual J# Express--are free with no time limit. Excited? If you
haven't grabbed the one you want yet, head on over to the Visual Studio
Web site. But there's no rush, they'll be free forever.
http://msdn.microsoft.com/vstudio


Microsoft to Re-release Buggy Patch

Last week's buggy Microsoft patch (MS06-015) will be replaced,
Microsoft says. The company plans to ship a new version of the security
patch by next week to help customers who have experienced problems (I'm
one of them; see WinInfo Blog for details). Users with HP scanner
drivers, certain NVIDIA video cards, and even Microsoft Internet
Explorer (IE) users have been having all kinds of problems since MS06-
015 was released. Although Microsoft initially downplayed the problem,
the company has finally owned up to the fact that it completely botched
this one. Microsoft says a new version of the patch is expected to ship
Tuesday, April 25, via Windows Update, Microsoft Update, and Automatic
Updates.


Microsoft Denied IBM Documentation in EU Case

A third US judge has denied Microsoft access to competitor
documentation, which was part of the software giant's quest to get
around a European Union (EU) decision. In New York, Judge Colleen
McMahon denied Microsoft's request for a subpoena of IBM documentation,
calling the request a "blatant end run" around the EU's legal
authority. Microsoft was previously denied similar requests in
Massachusetts and California. Nice try, guys.


eBay Considers Microsoft-Yahoo! Partnership to Fend Off Google
Juggernaut

Nothing brings erstwhile competitors together faster than a new threat.
Months ago, eBay began reaching out to Microsoft and Yahoo! to find an
ally who will help the online auction company compete with Google. eBay
and Google were one-time allies themselves, but eBay became alarmed
over the years as Google edged closer and closer to eBay's business
model by launching a classified advertising service that competes
directly with eBay's online auction service. I'm surprised it's taken
this long, but the computing world is finally coming around to the
notion that Google is, indeed, the new Microsoft: Google wants a piece
of every conceivable market, and it's not afraid to step on its
partners to achieve its goals. My guess is that Google will soon be one
of the most distrusted companies on Earth.

End of Article



Reader Comments
Once again Paul destroys his credibility (did he have any?) with that summary of Apple's financials.

cesjr April 21, 2006 (Article Rating: )


curious question... if you said that "Mac sales grew just 4 percent." then you said later "Have Apple's products leveled out? It's starting to look that way." did mac sales level off or did they grow? i'm confused because i would like to be able to take your word for it but when you sell more year to year that's considered growth. ahhh... which is it? level or growth?

iamkida April 21, 2006 (Article Rating: )


"if you said that "Mac sales grew just 4 percent." then you said later "Have Apple's products leveled out?"


Yes, this indicates they've leveled out. If the entire industry is growing at say 8 percent, and Apple experiences 4% growth, they are in market share decline. The entire economy is doing fantastic right now, most people are buying new machines and less-than-industry growth rates typically indicate installed-base replacement rather than new business.

This doesn't mean that Apple is on the verge of collapse like in the mid to late 90s. Rather that they could be approaching saturation for their products. If this occurs, they need to break into new markets in order to maintain profitability.

It's safe to see Apple thinks this way as well, as Boot Camp is an attempt on their part to find a new market segment. They'll try to sell hardware to the windows crowd or MacOS to the windows crowd. It appears they've gone with the first point (which doesn't preclude the second option at a significantly later date).

Anyway, in regards to the business fundamentals, this could put Apple stock into a protracted decline. There is a lot of "goodwill" based on the expectation of continued growth. If that doesn't occur you'll see a steady erosion of share price.

Realistically, Apple and Google are in exactly the same situation. The companies are acting in almost the exact same manner in their respective markets.

Christopher April 21, 2006 (Article Rating: )


I think a strong Apple will work in the entire industry's favor. Apple has been at the forefront of innovation and is among the best hardware designers. I think the company has an attitude problem, but I guess that's acceptable. Goolge too has some cool products, but I think they should just give up the "Don't be evil" facade. I know it helps the company a lot, but the events in China have proved that it's not true.

shark47 April 21, 2006 (Article Rating: )


"This quarter, iPod sales grew 61 percent, but that pales when compared to the 558 percent growth the company experienced last year. ..... Have Apple's products leveled out? It's starting to look that way."

Ho! Ho! Ho! Yeah, Paul, the annual increase in Apple's iPod sales has dropped from 558 percent to a measly 61 percent. They're on the ropes now! (chuckle, chuckle....).

nim55 April 21, 2006 (Article Rating: )


And the fun continues: MS06-015 isn't the only buggy Microsoft Patch this week! Woo hoo!!!

http://www.eweek.com/article2/0,1895,1952402,00.asp

"A Microsoft spokesman said the company is investigating new reports of patch-related glitches with the MS06-016 cumulative security update that fixes a remote code execution flaw in Outlook Express. He said the company will provide customer guidance once it figures out the reasons for the problems."

"Patch Tuesday" is more fun than Russian Roulette!

lotsamystuff April 21, 2006 (Article Rating: )


When I want information on flying to France, I'll read Paul's blog. When I want sound financial reporting, I'll turn to sources such as the financial pages of The Seattle Times:

"Shares of Apple jumped after the report on relief that the company's earnings weren't held back by slowing iPod growth and the switch to Intel chips in the Mac.

"It was a giant sigh of relief," said James Grossman, a fund manager at Thrivent Financial for Lutherans in Appleton, Wis. The firm oversees $65 billion including Apple shares. "It panned out a little better than some expected."

The stock rose $2.91, or 4.4 percent, to $68.56 in extended trading after declining 57 cents to $65.65 during the regular session.

"They held Mac shipments and even increased it slightly year over year in the midst of an architectural change without having to cut prices," said Barry Jaruzelski, a technology analyst for consulting firm Booz Allen Hamilton in New York."

Paul Thurrott: The FOX News of Tech Reporting.

lotsamystuff April 21, 2006 (Article Rating: )


"This doesn't mean that Apple is on the verge of collapse like in the mid to late 90s. Rather that they could be approaching saturation for their products."

No, they're experiencing a temporary slowdown as users wait for the Intel transition (including native versions of key applications) to be complete. iPods are still selling like...well, iPods, and there hasn't been a (major) new model to spur those sales on. When there is, Katie Bar The Door.

The fact that they've done this well in the midst of this changeover AND increased profits year-over-year is, IMHO, remarkable.

Again, let's hear what the experts have to say (from marketwatch.com):

"They essentially are the MP3 market," said Barry Jaruzelski, technology managing general partner at consultancy Booz, Allen, Hamilton. "So far, they haven't hit the top of saturation point."

"Analysts were largely realistic and upbeat about Apple's performance. Shaw Wu, of American Technology Research, maintained his buy rating on Apple's stock saying that the company's conservative outlook is "another attempt to reset unrealistic consensus revenue expectations."

Or unrealistic Thurrott expectations, for that matter.

lotsamystuff April 21, 2006 (Article Rating: )


"When I want information on flying to France, I'll read Paul's blog. When I want sound financial reporting, I'll turn to sources such as the financial pages of The Seattle Times."

"Paul Thurrott: The FOX News of Tech Reporting."

Of course, lotsamystuff. Praise PAul when he criticizes Windows. Otherwise, call him names. :-)

He doesn't talk about Apple stock prices anywhere. He is simply pointing out that every product has to reach a saturation point somewhere during its lifetime and the iPod seem to be close to that. nim55 and lotsamystuff, why are you going on such a defensive?

yahoo April 21, 2006 (Article Rating: )


"Google wants a piece of every conceivable market, and it's not afraid to step on partners in order to achieve its ends. My guess is that Google will soon be one of the most distrusted companies on earth."

They're only following the Microsoft model, Paul. Do you blame them?

lotsamystuff April 21, 2006 (Article Rating: )


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