Why The Big Story Is Software

How Microsoft's Vista and Apple's Leopard will fare


I don't need to be much of a fortune teller to predict the key tech news of early 2007. Microsoft's (MSFT ) two big efforts of the past few years, the long-overdue Windows Vista operating system and Office 2007, go on sale on Jan. 30. And Apple (AAPL ) will follow a couple of months later with the Leopard version of its OS X software for Macs.

These sophisticated and highly polished releases are a big deal, and I will be writing about them in detail in coming weeks and months. But ultimately, operating systems such as Vista and Leopard will diminish in importance.

For the past quarter-century, there has been a trend toward ever more complex software running on ever more powerful computers. In 2006, Web-based programs that can run on less powerful computers and simpler software began to emerge as serious contenders. In place of Microsoft Office, we may soon see people adopting productivity suites from Google (GOOG ), startup Zoho, and others—at least for use in homes and schools. Web-based programs have always had one big drawback: an inability to work when not connected to the Internet. But in the coming year, such programs will acquire richer features and become more useful, even when you are offline.

The important point is, Web programs need only a browser to work. The more popular they get, the less relevant Vista and Leopard, with all their fancy new bells and whistles, become. And because the new Web programs are all based on industry standards, even the choice of a browser is less important. For the past 10 years, Microsoft has designed all of its Web efforts to favor its Internet Explorer browser. But the new programs bundled under Microsoft's Office Live brand are designed to work equally well on ie and Mozilla's Firefox.

TOO BAD THIS SPIRIT OF COOPERATION and commitment to standards has not spread to digital entertainment, which promises to be another hot area. In September, Apple said it was building a product code named iTV. It's designed to bridge the chasm between the Net, where lots of digital movies and video are available, and tv sets, where most people want to watch this content. The product is due out in early 2007, but we still don't know much about its capabilities. My guess is that it will be at best a partial solution, limited to video that either has no copy protection or is purchased from the iTunes Music Store. Apple, like nearly everyone else in the business, wants to keep content within the walls of its store and its players.

One result of this approach is that a consumer who wants to watch the same content on a TV, a PC, and a handheld may end up paying for it three times. This is stifling the growth of digital entertainment, and the situation won't improve much in 2007. Far more content will be available from the Internet, but watching it isn't going to get much easier. Real progress will require a major collaborative effort among the companies that create computers, consumer electronics, and entertainment, which doesn't seem to be in the offing.

The picture is a lot happier in the wireless arena. Whether you're looking for e-mail on a handheld or video streamed to a laptop, your choices are going to get both more numerous and better. Many cities, Philadelphia and San Francisco being the largest, are building extensive municipal Wi-Fi networks that will work with laptops and a growing number of handhelds. Verizon Wireless (VZ ) and Cingular (T ) are expanding their high-speed data networks, and Sprint (S ) is rolling out a network upgrade that provides true mobile broadband.

Of course, technology tools and toys are only one aspect of our lives and far from the most important one. As in past years, I want to end 2006 by wishing all of my readers a happy, healthy, and prosperous New Year.

For past columns and online-only reviews, go to Technology & You at businessweek.com/go/techmaven/

By Stephen H. Wildstrom

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