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. Last Updated: 07/27/2016

Internet Now the Key to the Operation

Since the launch of its Windows 3.0 operating system in 1990, Microsoft has grown used to being master of all that it surveys and its dominance looks set to continue with tomorrow's launch of Vista, the latest update to Windows. But Microsoft now has some interlopers to worry about: Google, open-source software and the Internet.

The launch of Vista is a big deal for the computer industry. Personal computer manufacturers, chip manufacturers and makers of every computer-related peripheral from manuals to mice rely on Windows updates that persuade users to upgrade machines. In the five years since the release of Windows XP -- the longest gap Microsoft has ever left -- the PC industry has suffered.

Vista will have consumer appeal, although perhaps not as much as previous releases of Windows. With Vista, Microsoft is getting closer to what it has always promised: an intuitive, easy-to-use, graphical interface. Design and organization are better than XP and it is easier to search for data.

Microsoft is also touting the security features of Vista. That is welcome and will endear Vista to corporate IT managers.

But despite its long gestation period, Vista is not a fundamental change to the Windows we know and very occasionally love. There is no imperative reason to upgrade. Given the Internet's disruptive effect on how people use computers, Vista may mark the point when Microsoft's operating system monopoly, or at least the importance of that monopoly, begins to slip away.

When it first emerged, the Internet was like a library: You could search for information but not interact with it. That began to change when web-based e-mail -- like Hotmail -- began to compete with desktop e-mail software like Microsoft's Outlook Express. Google recently launched a web-based word processor and spreadsheet.

The danger for Microsoft is that, as people do more on the Internet, the desktop computer and its operating system become less relevant. Satisfactory web browsing needs a high-speed Internet connection but not much desktop computing power.

Microsoft is not threatened directly: Computers still need Windows to function. But users will not upgrade so often and competitors will be able to chip away at Microsoft's dominance. The open-source Linux operating system, which can be used freely and modified, has taken some market share, particularly for use on servers.

All of this is good news for consumers. Those who want the improved features can upgrade to Vista. And those who do not want them have, for the first time in a decade, a realistic choice. The vista looming for Microsoft is one of competition and change.

This comment was published as an editorial in the Financial Times.