Ultra-low-cost PCs have been drawing interest from governments and schools in emerging markets like India and Asia. For instance, the low-cost Asus Eee PC alone is estimated to sell around 120,000 units in India this year.

Ultra-low-cost PCs have been drawing interest from governments and schools in emerging markets like India and Asia. For instance, the low-cost Asus Eee PC alone is estimated to sell around 120,000 units in India this year.

Linux is the operating system (OS) running the current poster child for low-cost laptops like Asustek Computer’s Eee PC, released in January and costs just Rs 18,000. To counter this, Microsoft maintains that it wants to see Windows on ULCPCs, and wants “to provide the best possible Windows experience for the devices”.

Prasanna Meduri, director (Windows client business group), Microsoft India, says: “The feedback we’ve got from customers and partners is that they want Windows on low-cost devices.”

However, “the Vista operating system requires more horsepower than these machines have, but Windows XP Home could be a fit,” says an analyst.

This explains the extension of XP. For instance, Asus sells four versions of its Eee PC with a Linux-based operating system, but lists in the computer’s spec sheet that they all are Windows XP-compatible.

The results are showing. Says Francis Kao, product head (Notebook and Eee PC), Asus: “Microsoft approached us in the initial development phase of Eee PC. We had over 1,000 engineers working on the Eee PC. This May, we will release the Windows XP Home models with different storage capacities.”

The prices, however, are undecided but Kao admits “they could be higher than the Linux PCs as XP models will have more features”.

Linux was also supposed to be the OS for a forthcoming line of ULCPCs based on new Intel Atom processors, called Mobile Internet Devices (MIDs). However, since the MIDs are only expected at the year-end, this too could have been a reason for Microsoft to extend XP’s availability, say experts.

But what does XP’s extension mean for Vista? Microsoft maintains there are no plans to change Vista to make it more suitable for ULCPCs.