How scared is Microsoft of Linux?  There's a hint or two of its fear in the fact that MS is preparing a special slim-and-trim version of Windows XP, within the next month or two, to run specifically on Asus's Eee PC.  You'd think maybe it could have done this slimming-down sooner -- something that Linux already does without breaking a sweat.

Based on an in-depth examination of XP on the Eee published in Australian PC, plenty of evidence turned up that XP needed to be put on a diet to make the best use of the current iterations of the Eee.  With just the bare OS installed, that gobbled a little over half of the Eee's 4 GB flash storage.

For comparison, the version of Xandros Linux that comes with the Eee uses about the same amount of space -- but also includes all of the applications you'd need to get going.  The cut-down XP, when it ships, is supposed to also include Microsoft Works (yecch) as part of the bargain -- and frankly, given a choice between Works or OpenOffice.org, I'll take the latter any day.

Given that a whole crop of similar machines from other manufacturers are on the way -- like MSI's Intel Atom-powered Wind subnotebook -- it sounds like the next Linux vs. Windows territorial showdown will be in that space.  On the one hand, we have Linux's relatively smaller cost and system footprint; on the other, the familiarity and popularity of Windows (whether XP or not), which still drives sales in a way that Linux doesn't.  At least, not yet.  But the attention devoted to the Eee and the other devices that follow in its wake are finally threatening to change that.