Microsoft highlighted new multi-touch features on the range of new PCs as it launched Windows 7 in New York on Thursday.

Here’s a clip of a photo managing program, which allows you to sort through snaps and manipulate them manually, and a shot of the new Kindle application from Amazon, which lets people read a book onscreen, if that’s what they want to do.

The Windows 7 launch event was quieter than previous versions, focusing on slick new hardware and consumer-oriented features such as watching TV on the PC, creating home networks, making videos and playing music.

Early reviews of Windows 7 have been positive, but it will be a few months before it becomes clear if consumers really take to the new operating system.

-Matthew Bath is technology editor at Which? The opinions expressed are his own.-

Microsoft’s Windows operating system has been frustrating and delighting computer users in almost equal measure since it was first debuted by the software giant first in 1985. Fast forward through nearly a quarter of a century of powering the majority of the world’s personal computers, and Windows is about to hit another milestone.

Windows 7 launches on October 22, worldwide, and it’s safe to say that, as a firm, Microsoft will be collectively crossing fingers and toes that shoppers flock to the new version.

The successor to its Windows Vista operating system, Windows 7 promises to be faster, more reliable and make computing simpler than ever – so much so that like a proud parent, Microsoft hosting worldwide coming-of-age parties to help launch Windows 7 onto PC desktops worldwide.

Yet the key question is whether consumers, already stung by what many found a problematic Windows Vista, are as willing to take a punt on this latest version.

Certainly, it’s chalking up record sales – and Windows 7 has overtaken Harry Potter and the Deathly Hallows to become the biggest grossing pre-order on Amazon.co.uk of all time, and the online store says demand for the new operating system remains strong.

So why are shoppers pre-ordering in droves? Partly, it’s because Microsoft fumbled the ball with Windows Vista, leaving some users frustrated and fed-up with an operating system that felt sluggish and crash prone. A chance to jump to a shinier ship is welcomed. Partly, last time lots of people stayed away from the Windows Vista party following negative reports, remaining with the perfectly functional Windows XP instead.

The surge in sales tells only part of the story, however. Which? has talked with shoppers who tell us they are confused by Microsoft’s different versions (with six different prices at the last count), and there are lots of questions around whether the upgrade really is worth the hassle.

Certainly, a lot of the features seem fairly cosmetic on the surface, and some will appeal to only a handful of users. If you’re one of the chosen few to own a touchscreen PC and monitor, then the new multi-touch features in Windows 7 will have you clapping (and pinching and swiping) your hands with glee as your monitor turns into the equivalent of an outsized Apple iPhone.

Other features – such as easier home networking and interface tweaks to make navigation simplier are all good, but seem slight. Rather, Microsoft has been significantly reworking the technology that happens under the hood of Windows, making it less crash prone, faster, and hopefully a better experience.

If you’re happily using Windows Vista, though, then there really isn’t a compelling reason to upgrade as the new features are hardly lengthy.

And if you’re using Windows XP, then Microsoft has a different message for you: your PC is unlikely to run Windows 7 well, and you’ll have to fork out for a new computer. That’s an expense in these economic times that many consumers might find a little tough to swallow.

And, finally, amidst all Windows shopping it’s easy to forget that most new operating system launches are hit with bugs, glitches and incompatible software. That’s normal, but not any less frustrating.

So, if you are looking longingly through the Microsoft-shaped window, our advice is clear. Resist the temptation to upgrade straight off the starting blocks and wait for Microsoft and other software makers to find and fix the niggles and bugs, then feel free to jump in to Windows 7.

Apple’s new Snow Leopard operating system has hit the ground running, according to research data released Thursday

Sales during the first two weeks of Snow Leopard’s release “far exceed those of the last two Apple operating systems,” market research company NPD said. The group tracks U.S. retail sales. Snow Leopard launched Aug. 28, available as an upgrade at an affordable price of $29.

According to NPD, Snow Leopard sales were more than two times higher than those for the initial release of Leopard back in 2007, and almost four times higher than the Tiger OS in 2005.

“Even though some considered Snow Leopard to be less feature-focused than the releases of Leopard or Tiger, the ease of upgrading to Snow Leopard and the affordable pricing made it a win-win for Apple computer owners - thus helping to push sales to record numbers” NPD’s Stephen Baker said in a statement.

Apple is the No. 4 PC maker in the U.S., according to research group Gartner, with 8.7 percent of that market.

Arch foe Microsoft’s new Windows 7 operating system goes on sale October 22. It starts at $119.99.

Thousands of Microsofties yucked it up at the expense of rival Apple at their annual get-together at Seattle’s Safeco field on Thursday.

Saturday Night Live star Seth Meyers set about the old foe, which had its own festival of self-congratulation yesterday.

“Who at Apple let an 8-year-old girl name their new operating system Snow Leopard?,” Meyers asked, according to one employee spreading the good word on Facebook. “What, was Unicorn taken? Was Pony not available?”

Fair point, perhaps. But what’s this? A preview of the first TV ad for Microsoft’s new Windows 7 operating system, airing on prime time tonight. It features a young girl and a — admittedly kitsch — unicorn.

Some tech links to start the week:

I am seriously considering changing my byline to Zing, what with all the media attention a certain search engine is getting.

The New York Times looks at the ups and downs of turning brands into verbs. The jumping off point is Bing, Microsoft's effort at verbal one-upsmanship over Google, Twitter and over generic daily activities. The software giant must alter deeply ingrained computer habits to succeed. In the meantime, my original questions about Bing remain.

The more substantial news this week would be if Microsoft finally inks a search and advertising partnership with Yahoo Inc. It's not easy to overcome deal speculation fatigue -- it's been a year-and-a-half since Microsoft sought to acquire Yahoo outright, and a year since it dropped back to Plan B and sought out a more limited partnership deal. Boomtown reported Friday that Microsoft is down to a few short strokes away from signing.  Henry Blodget makes the point that Microsoft may have to pay up far more than the $1 billion it was offering a year back for such a deal.  Closing a deal now suggests renewed desperation on Microsoft's part after the paltry gain it received from Bing in June market share statistics for U.S. web search.

Beyond the personalities and the history that have kept Yahoo and Microsoft apart, there is the little matter of an advertising recession  that will delay any short- or medium-term rebound in either company's online advertising fortunes. AOL Chief Executive puts any resurgence in online advertising out to 2011 in an interview published by Reuters on Sunday.

UBS has published its quarterly survey of corporate technology spending intentions. The study of 100 U.S. and European CIOs finds these buyers slightly more optimistic about their budgets during the second quarter than they were earlier this year.  Among the more interesting findings:

• U.S. spending appears to be improving while European discretionary IT spending is declining.
• IBM and HP/EDS will take the lion's share of any increased spending by CIOs on computer service, while Accenture, CSC and Indian software services companies all stand to see far less.
• Only a handful of software companies can expect to see increased net spending in the next 12 months: Microsoft, SAP, Citrix and Oracle , to a far lesser degree. Out of favour are technologies such as security, software as service and voice recognition.
• Dell saw a big gain among buyers more likely to spend with it.  The Q2 survey showed 21 percent of buyers more likely to buy, up from 12 percent in Q1. UBS pins this increase on Dell's willingness to slash pricing.

The biggest surprise is the gulf emerging between the U.S. and Europe over plans to upgrade to the next version of Windows 7, due out in October, UBS finds. More than half of Europeans have no plans to upgrade to Windows 7, while closer to a quarter of U.S. buyers have yet to make plans. (Click to enlarge graphic)

(Images: Microsoft, UBS Research)

Here are some of the day’s top stories in the media industry:

Microsoft takes on Google as Office moves to Web (Reuters)
Jim Finkle reports: “Microsoft will offer for free to consumers Web-based versions of its Office suite of programs, including a word processor, spreadsheet, presentation software and a note-taking program. Microsoft will also host one Internet business version of Office at its own data centers, charging companies a yet-to- be-announced fee.”

Six in 10 companies plan to skip Windows 7 (Reuters)
“Many of the more than 1,000 companies that responded to a survey by ScriptLogic Corp say they have economized by cutting back on software updates and lack the resources to deploy Microsoft’s latest offering.”

MySpace to Take Entertainment Tack (WSJ)
“In a brief interview, News Corp. Chief Executive Rupert Murdoch said MySpace needs to be refocused ‘as an entertainment portal.’ Mr. Murdoch described his vision for MySpace as a place where ‘people are looking for common interests,’” writes Julia Angwin.

15-Year Old Analyst Trashes TV, Newspapers, Radio, And…Twitter (Business Insider)
“A 15 year-old working in Morgan Stanley’s London office has written what may be the firm’s most popular research report in years,” writes Henry Blodget. “In it, he explains that none of his friends read newspapers and few watch TV. He also, interestingly, says none of them use Twitter, because no one reads the tweets texting costs money.”

McGraw-Hill trying to sell BusinessWeek (Reuters)
Jui Chakravorty Das and Robert MacMillan report: “McGraw-Hill Cos Inc is trying to sell BusinessWeek magazine, a source told Reuters on Monday, at a time when media advertising sales are slumping and would-be buyers for newspapers and magazines are scarce. McGraw hired boutique investment bank Evercore Partners Inc to manage the sale, said the source, who was familiar with the situation but not authorized to discuss it publicly.”

In other news:

• At $6.5 Billion, Facebook is Now Worth More than CBS (Mashable)
  
• Magna Forecast: Ad Recession to Drag On (E&P)
  

A lot may be riding on the release of Microsoft’s newest operating system, Windows 7, which is due in October, not the least of which is an expected rush of advertising to support everything from the software itself, to the computers it will run on to the rival computers it will not run on.

This surge of business is seen coming just as the holiday shopping session gets under way and could help spark the economic turnaround that some suggest will come later this year.

Or maybe not.

According to a survey by ScriptLogic, six in 10 companies plan to skip buying Windows 7. Some will pass on the added cost of the upgrade, while others are concerned about compatibility with existing applications.

Perhaps consumers will be less squemish about Windows 7 than businesses. Then again, neither were exactly thrilled about Microsoft’s last upgrade — Windows Vista….

Keep an eye on:

• McGraw-Hill hires Evercore as bankers in effort sell BusinessWeek (Bloomberg)
• Pandora gets financing (TechCrunch)
• Microsoft’s Bing - so far so good, trafficwise (New York Times)

Hewlett-Packard and Dell, the world’s No. 1 and No. 2 PC makers, weighed in Thursday on Microsoft’s Windows 7 operating system, which is expected early next year.

Michael Dell, on a conference call following the company’s quarterly earnings report, was asked whether Dell is seeing any changes from enterprise customers related to Windows 7. He said:

We’re starting to get pretty excited about Windows 7 and believe it’s going to be an important catalyst for growth. Having said that, it will also push purchases until Windows 7 comes out.

Microsoft sounded a similar note at the Goldman Sachs Technology and Internet Conference. CFO Christopher Liddell said Windows 7 could help PC sales bounce back next year. He also expects some users to delay buying a new computer to wait for Windows 7:

We might see a bump (in PC sales) next year, just as a result of lower demand this year. It will be helpful, but it will not outweigh the general macro-economics.

Earlier in the day at the Goldman conference, HP CFO Cathie Lesjak was also asked about the impact of Windows 7 on consumer and corporate demand:

We didn’t think there was going to be a Vista moment. We don’t think there’s going to be a Windows 7 moment either… We are not expecting that there’s going to be this huge hockey stick effect when Windows 7 comes out. The good news is we’re hearing positive things about Windows 7.

Stripped down, low-cost netbooks may be the hottest thing going in personal computers these days, but there continues to be debate about their ultimate impact on the income statement. Almost all of the world’s major PC companies have by now dived into the netbook market, including Hewlett-Packard, the world’s No. 1 PC maker.

HP CFO Cathie Lesjak was asked at the Goldman Sachs Technology and Internet Conference whether the company expects to see a netbook impact on average selling prices (ASPs) and margins.

“I think you really need to separate ASP pressures from margins. Because first off we actually believe that netbooks in the long term are going to… generate incremental revenue and ultimately incremental profits … The netbook also has a lower bill of materials… If you’ve got good cost structure … long term we actually think this is positive for PC revenue and profit.”

Lesjak was also quizzed about the impact of Microsoft’s new Windows 7 operating system - which the software company says will be out by January 2010 - on consumer and corporate demand.

We didn’t think there was going to be a Vista moment. We don’t think there’s going to be a Windows 7 moment either… We are not expecting that there’s going to be this huge hockey stick effect when Windows 7 comes out. The good news is we’re hearing positive things about Windows 7.

Last week, HP slashed its full-year forecast, saying it expected weak market conditions to persist. Lesjak said Thursday she was “very confident in the earnings goals that we laid out for you in the earnings call last week and confident that we’ll generate strong cash flow in 2009.”

After watching Bill Gates deliver Microsoft’s keynote address at the Consumer Electronics Show for 12 years, CEO Steve Ballmer finally got his moment in the sun on Wednesday.

We were rooting for you Steve, but next time, tell your friends not to steal your thunder.

First, it was Verizon CEO Ivan Seidenberg leaking the news that the U.S. phone company has picked Microsoft as its default mobile search provider. It’s a big win for Microsoft, which has been lagging behind Google and Yahoo on the Web, but Ballmer didn’t get to be the first to tell the world. Seidenberg stole the spotlight, announcing the deal at a Citi investor conference earlier on Wednesday. We were hoping Microsoft would take back the limelight by giving us more details when it was Ballmer’s turn at CES, but alas, all the CEO said was, “I’m also thrilled to announce a new long term partnership with Verizon to offer our live services on all Verizon phones.”

Besides the Verizon deal, Ballmer also announced at CES the beta test launch of Windows 7, Halo Wars, a Windows Live deal with Dell, and a bunch of other stuff. But most of it, while good news, didn’t seem to wow the crowds at the Palazzo Ballroom in the Venetian hotel.

The funniest moment of the keynote, in our opinion, was when Ballmer joked about the advice Bill Gates gave him for his first-ever keynote. Ballmer flashed a message on the screen from Gates that said “There are always two conventions going on during CES - make sure you go to the right one.” The other conference is the adult entertainment expo, of course (if you didn’t know).

He then followed with supposed messages from President-elect Barack Obama, disgraced Illinois governor Rod Blagojevich and others, including this faux gem from Yahoo CEO Jerry Yang:

“Why do you keep ignoring my Facebook requests?”

(Photos: Reuters)