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LOS ANGELES--Microsoft has high hopes for its .Net initiative, but not everyone is sold on the idea. Research firm Gartner Group poured some water on the coals of the software giant's ambitious plans, saying they see only a fleeting hope for a swift evolution to Web-based computing.

Analysts speaking at Gartner's annual Windows conference here extinguished much of the hype surrounding what they called a "remarkably confusing" marketing blitz around .Net.

.Net is a broad project through which Microsoft hopes to provide tools, software, and services that will help turn the Internet into a giant network for delivering applications and services to all kinds of devices from PCs to cell phones.

Potential Potholes

With Microsoft facing a number of potential speed bumps ranging from increased competition to the outcome of its antitrust appeal, Gartner warned information technology managers not to expect its Web services model to become a reality too soon, using the term "vaporware" as loosely as they did "visionary."

However, analysts did say that as a world of Web services inches nearer, the software giant will have many important product releases--as well as changes to its business structure--that IT managers using Microsoft products should prepare for.

".Net is still a vision," said Gartner analyst Tom Bittman. "It has some details, but at this point there are a lot of gaps to fill."

At its conference, "Windows 2000 and Beyond: Riding the Microsoft Roller Coaster," the Stamford, Connecticut-based research group offered a projected time line of Microsoft's evolution to Web-based computing, one that fills in many of the gaps in the .Net strategy. Much of its success hinges on Microsoft's ability to attract support from other large IT industry players and to deliver on its product roadmap, the analysts said.

"This is fundamentally a brand new platform," said Gartner analyst Mark Driver, comparing the migration to .Net as more drastic than the switch from MS-DOS to Windows. "This is the tiger changing its stripes."

XP Offers a Peek

The release of the desktop software suite Office XP on May 31, which will be followed later this year by the Windows XP desktop operating system, points toward some progress for .Net, Gartner analysts said. Still, these releases offer only small pieces of what Microsoft has promised its .Net effort.

It won't be until 2003 or beyond that the first operating system really tied into the .Net framework will reach consumers and business customers. Known today by its code name, "Blackcomb," Microsoft has alluded to a launch of this new operating system and software for sometime in late 2003.

"This is where things get really fuzzy," said Neil MacDonald, a Gartner analyst covering Microsoft. "Blackcomb is basically the bucket for everything that doesn't get into XP."

Making predictions for that far ahead is difficult since Microsoft's .Net framework has yet to gain widespread backing from other IT hardware and software vendors, something that Sun Microsystems already has achieved with its Java language, which will compete with .Net for the attention of developers.

Besides dealing with new technology, Gartner analysts said that Microsoft customers could also expect to be working with a new type of company in the next few years. One of the major changes will affect the way Microsoft charges its customers for software and services. While Microsoft's product pricing will remain relatively constant over the next few years, customers will end up paying about 50 percent more each year due to changes in its licensing model and the addition of subscriptions fees for upgrades and maintenance, said Gartner analyst Alexa Bona.

Breaking Up Is Hard to Do

The industry could also expect to see Microsoft transformed by major acquisitions, strategic partnerships, and a likely breakup, Gartner analysts said.

Growth in non-core businesses, such as consulting, would play into a breakup of the company, the research firm said. Offering little more than intuition, Bittman said that a breakup could happen either by the hand of the government or by Microsoft itself, as the company fights to maintain its grip on the consumer market and expand its role in the enterprise.

"It is a scenario that we've looked at," said MacDonald. "While Microsoft has said that at this point it doesn't need to break up, the probability of this scenario is not zero."

Gartner argues that pressure over antitrust concerns will continue to hamper Microsoft's ability to make acquisitions and tie new products into its operating system. "Every time Microsoft does anything now people start talking about antitrust implications," MacDonald said. "If Microsoft found that it was unable to make acquisitions simply because every time it did it came under antitrust scrutiny, I think they may [divide]."

A U.S. Court of Appeals is expected to rule any day now in Microsoft's appeal of its antitrust case, in which a district court judge found the company to be a predatory monopolist and ordered that it be broken in two. The appeals court decision could result in the case being sent back to the district court or upward to the Supreme Court. Either way, as Gartner sees it, Microsoft will likely divide in order to conquer.

"The [Department of Justice] and the government are going to continue to have a choke hold on Microsoft regardless of the outcome of the current court case," MacDonald said.

While Gartner's many scenarios may hold water, the future of Microsoft and its Web efforts, as any good analyst firm would admit, could also look entirely different.

David Chappell, a consultant and Microsoft pundit who headed a seminar at Gartner's conference, said that much of the company's success relies on .Net gaining traction in the consumer market. One key to that success will be the deployment of a Web services initiative code named "Hailstorm," which includes building-block services for user authentication, messaging, and calendaring.

So far, critics and competitors have raised a number of concerns over Hailstorm--principally that it may cripple users' privacy by giving Microsoft, as well as any hacker who can break into the system, access to personal information.

Fitting of many of the other challenges the software giant faces, Chappell notes, "If they can't succeed with that, their whole business goes away."

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