Microsoft is to extend the sales of Windows XP Home to OEMs beyond the current deadline of 30 June to accommodate the new breed ultra-low-cost PCs (ULCPCs).

Windows XP Home will be available for OEMs to install on ULCPCs either until 30 June, 2010, or one year after the availability of the next client version of Windows, code-named Windows 7 - whichever comes later.

Though Microsoft has not yet revealed when it expects Windows 7 to be released, it's safe to say the operating system either will be available before 30 June 2010, or Microsoft at least will have an idea by then of when it will be released.

"That is not an unreasonable presumption to make," said Kevin Kutz, director of Windows Client for Microsoft. The company has said it will release Windows 7 by the end of 2009 or early 2010, but has been vague about specific details or an exact release date.

Kutz stopped short of saying Microsoft is willing to extend the availability of a seven-year-old OS because it doesn't want to concede the ULCPC market to Linux, which many feel is the reason for the move. Instead, he said it's customers and partners who are driving the extension. "The feedback we've gotten from customers and partners is they want Windows on those devices," Kutz said.

At the same time he acknowledged that Microsoft, too, wants to see Windows on ULCPCs, and wants "to provide the best possible Windows experience for the device."

Still, if Microsoft is willing to allow OEMs to put a version of Windows on devices up to nine years past its release date when there will be not just one but two XP successors on the market, it's apparent the company recognises a threat from Linux in that market. Linux is the OS running the current poster child for the low-cost laptop - Asustek Computer's Eee PC, which was released in October and runs the Xandros distribution of Linux.

Linux also was supposed to be the OS for a forthcoming line of ULCPCs based on new Intel Atom processors that are due out later this year, laptops Intel is calling Mobile Internet Devices (MIDs). In the past, Intel had said the MIDs would run Linux and established an effort, called Moblin, to develop a version of the open-source software for the devices.

However, Intel's Gary Willihnganz, director of marketing for its Ultra Mobility Group, said this week that Windows XP and Vista will also run the Atom-based MIDs in addition to Linux. He even suggested that the devices will be designed with support for Vista in mind, by saying the new platform will "be enabled" for both XP and Vista.

Since Intel's MIDs are not expected to be available until after XP's current 30 June deadline, this likely inspired Microsoft to change its XP availability policy. On the ULCPCs that are currently available for the market, Vista is not an option because of its memory and hard-drive requirements. Kutz said Thursday that Microsoft has no plans to change Vista to make it more suitable for ULCPCs, and hinted that forthcoming ULCPCs will evolve to the point that they can run Vista.

"It depends on what an ULCPC becomes over time," he said. "Right now we're enabling as much flexibility and choice as possible."