Microsoft gears up for server software launch

SEATTLE: Microsoft Corp. MSFT.O , the world's largest software maker, said it completed work on its flagship server software for managing computer networks, which will ship next month after a series of delays. The new server software is also being launched at a time when Microsoft faces stepped-up competition from Linux, the free operating system that is being adopted by an increasing number of businesses for their network computing needs.

Microsoft said that Windows Server 2003, previously known as Windows .NET Server, was released to manufacturing on Friday, which means that computer makers will start loading it onto machines ready to ship and that Microsoft will start making boxed CD-ROM copies.

More than 5,000 software engineers worked over three years to develop the new software, Microsoft said. Similar to its strategy for bundling features into each new product upgrade, the new Windows server software will be able to handle file, printing, e-mail, web pages and applications on top of basic networking functions.

Other features, such as messaging and the ability for groups to work on a single file or document, will be available as add-on features while the specialized database storage server, SQL, will remain separate.

"Windows Server is the foundation for our overall server business," Bill Veghte, Microsoft's vice president in charge of the servers group, said in an earlier interview. Veghte said the new server would offer twice the performance of its predecessor and require a third less administrative staff.

Although some customers have described the new server software as "version 3.0" referring to Microsoft's pattern of getting its software right on the third try, one analyst hailed the software a comprehensive upgrade. "The improvements in performance all across the board are substantial," said Peter Pawlak, lead analyst for server applications at Directions on Microsoft, an independent research company in Kirkland, Washington.

Microsoft is marketing the software on the basis of its potential to lower network costs for businesses at a time when corporate information technology budgets are being squeezed. Microsoft and Linux, which both work on Intel Corp.'s INTC.O microprocessors, have both been chipping away at Sun Microsystems Inc.'s SUNW.O share of the Unix server hardware and software market for the past few years.

Other features of the new server software include the ability to handle a larger array of multiple processors, greater memory as well as advanced 64-bit processors -- areas where Linux has been gaining ground.

Microsoft has had to push back the launch of the Windows Server software several times, most recently last year when it opted to beef up the security of the product. That delay came after Microsoft adopted a company-wide crusade of "Trustworthy Computing" to make its products more reliable and secure. Microsoft's server software has been a frequent target of hacker attacks and malicious programs, most recently in January with the 'SQL Slammer" worm that slowed Internet traffic worldwide.