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In an attempt to maintain market share and not lose out on the swelling
netbook market, Microsoft is planning to offer a stripped-down version of
Windows 7, called Starter Edition.

Windows 7 Starter Edition will be a crippled version of Windows 7 that will
only be able to run three concurrent applications and will lack many of Windows
7’s advanced features.

The big question is, Will customers be willing to pay for an OS that is arguably
less capable than Windows XP Home edition, which is currently found on the
majority of netbook computers? Netbooks have proved to be a challenge for
Microsoft—the company has had to make special exceptions to get netbook vendors
to put a Microsoft OS on those systems, the end result being a step backward
down to Windows XP.

Further adding insult to injury for Microsoft was that most netbooks simply
did not have the horsepower to run Windows Vista, creating the impression that Vista
is too bloated and slow to be efficient. Microsoft aims to fix perceptions and
other problems with Windows 7 Starter Edition, but one wrong move here could
derail Windows 7.

How will Apple respond to the launch of Windows 7 Starter Edition? I can
picture the cute commercials now. Imagine a Mac commercial where the PC guy is
shown juggling a couple of balls, the Mac Guy walks in juggling dozens of balls
and throws one ball in the PC Guy’s direction, and the PC Guy drops everything.

If Microsoft wants to capitalize on the netbook market and fight off the
coming Apple netbook, the company will need to take a different approach. Here
is what I suggest: First off, make sure that Windows 7 Starter Edition has a
flawless browser—after all, most netbooks are for Web browsing. Second, make
sure that Windows 7 Starter Edition runs Web applications efficiently—which
will be the future for netbook computers. Third, offer Windows 7 Starter
Edition for FREE and offer it now.

By offering it free, Microsoft could trounce all of the Linux distributions
and build a large upgrade market at the same time. Also, Microsoft could limit
Windows 7 Starter Edition to Intel’s Atom processor, making sure it stays only
in the netbook market. What’s more, the free OS would be immune to most of
Apple’s criticism—after all, it’s free.

Microsoft could further its war on Apple by creating a dual-boot version of
Windows 7 Starter Edition that would run on Apple’s forthcoming netbook,
perhaps taking some of the polish off of Apple and creating an Apple netbook that
is more business-friendly. After all, if it’s free and if it’s dual boot, then
why wouldn’t an Apple user give it a try?

Many may wonder, would Microsoft be giving away a ton of profits by
providing a free OS? Probably not. A free version of Windows 7 Starter Edition
could build a level of excitement for Windows 7 proper not seen since the
launch of Windows 95. Also, Microsoft could ramp up its applications store to
sell products specifically meant for Windows 7 Starter Edition. Finally,
Microsoft could offer discounts to registered users of Windows 7 Starter
Edition for upgrades to Windows 7.

With a little less greed and a little more thought, Microsoft could turn
Windows 7 into the must-have OS by simply giving away the Starter Edition.