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Microsoft CEO Steve Ballmer is onstage doing what he does best--revving the audience with the latest advances in Windows; touting the operating system's integration with other Microsoft products, low cost, and improved security; and downplaying Linux. Ballmer exudes confidence, and why not? Despite pressure from his open-source competitor, Windows sales continue their unabated growth.

In what year would you place the above scenario: 2000? 2004? 2010? There's no wrong answer. In the world of computer operating systems, it's easy to imagine a competitive landscape that's not much different several years from now than today, with Windows on top of the market, Linux coming on strong, and Unix holding on. "That's pretty much the makeup of the land," says IDC analyst Al Gillen.

Microsoft has its operating-system road map sketched out through 2007 in the form of its Longhorn release. For the Windows camp, the question isn't what new things are planned but what Microsoft will deliver. Already, features are dropping. The first to go: a next-generation file system dubbed WinFS that was too complex to complete during Longhorn's three-year development cycle.

Linux creator Torvalds doesn't foresee an overhaul of the operating system.

That's the thing about operating systems. They take years to develop, making it tough for new entrants to break through. Windows was first released 19 years ago, and Unix goes back 35 years. MVS and VMS have been around more than 20 years, though they've been renamed.

It's a hard market to crack," Linux creator Linus Torvalds says in an E-mail interview. "You need something really quite startlingly different. Either some new and radically improved usage model or hardware base ... or something that just works better. And the latter takes a long time to develop."

New operating systems may emerge, but the battle that's shaping up is between competitors we know. It's Windows versus Linux, and it's Microsoft's fight to lose. Windows server sales accounted for 34% of the worldwide $11.5 billion server market in the third quarter, with revenue climbing 13%, according to research firm IDC. On the desktop, Windows runs on 94% of PCs that ship.

Longhorn represents Windows' next major step forward. "This is going to be a very big release--the biggest release of this decade," Microsoft chairman Bill Gates promised when he demonstrated an early version of Longhorn in October 2003. Though WinFS won't make it in, Longhorn's presentation and communications subsystems are on track, and Microsoft will make them available for Windows XP and Windows Server 2003, too.