is once again delaying its much-ballyhooed release of security fixes for its Windows operating system.
The interim release of an update for Windows XP, called Service Pack 2, is still due for an August release, as last announced by the company, a Microsoft spokesperson confirmed Thursday. But Microsoft missed its deadline to deliver a final version to computer makers Wednesday, wire services also reported Thursday. The company decided to push that date back by a couple days or a couple weeks to meet quality standards, the spokesperson explained.
The delay comes on the heels of Microsoft previously delaying SP2's release from earlier this summer to this month. Shares of Microsoft recently fell 26 cents, or 0.9%, to $27.80.
Microsoft is touting Service Pack 2 as a big security fix for its virus-prone operating system. But whether it will be a so-called revenue event remains unclear because Microsoft will offer Service Pack 2 for free to users of Windows XP, the latest version of its operating system.
Some analysts have speculated it could drive more upgrades to Windows XP and Office 2003, the latest version of Microsoft's productivity suite.
"I think it does help people feel more comfortable migrating to XP," said Friedman Ramsey Billings analyst David Hilal, noting that some customers typically wait for the first two service packs to come up before upgrading to Microsoft's operating system. "Maybe it does help the business do a little better and provide a little upside to the coming quarters."
But Hilal didn't model any specific revenue increase from Service Pack 2 in his projections, he said, although part of his model assumes continued adoption of Windows XP. (Hilal has an outperform rating on Microsoft and his firm hasn't done any banking with the company.)
Tony Ursillo, an analyst with Loomis, Sayles & Co., attributed even less importance to Service Pack 2.
"It's gotten more attention because of the vulnerability of Windows in the past year to virus and worm activity," said Ursillo, whose firm holds Microsoft shares. But "they don't charge for it. It hasn't been a deterrent to anyone buying PCs."
Ursillo added that he doesn't see how the update could drive Windows upgrades. "I'm not sure what people would be waiting for because they're already more vulnerable.
Windows 2000 and every release prior to that -- those are more vulnerable than XP," he pointed out.
"I think this delay is getting more attention than it deserves," Ursillo concluded.
The update is one of the most concrete results of Microsoft's trustworthy computing campaign launched about two-and-a-half years ago, but it's unlikely to completely eliminate the threats of viruses and worms. "There wasn't a silver bullet that I was jumping up and down about," Hilal said of the SP2 demo he saw last week at the company's annual analyst day. "It all seemed to be good stuff."
The update includes a one-stop security control panel for users to determine if all of their security software, including firewall and antivirus software, is up to date. The company worked with third-party vendors such as
to include information about their products in that panel.
In addition, the update will change the operating system's defaults so that the firewall is automatically turned on rather than off. Previously, users had to turn on their firewall and often didn't. The update also aims to cut down on "phishing" -- scams to steal personal information in which criminals lure people by email to spoofed Web sites designed to look like those of legitimate companies. The update will display the spoofed Web site's actual address and not just the fake one that the spoofer wants victims to see.
But another addition in SP2 -- a pop-up blocker -- comes late to the game, as rival
has offered that feature to block pop-up advertising on its browser toolbar for some time.