In an effort to avoid the compatibility problems that plagued Windows Vista, as many as 10,000 hardware and software companies already are working on products that will work with Windows 7 when it arrives later this year, a senior Microsoft official said.

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"At the Release Candidate, we had over 10,000 commercial companies -- this is hardware and software -- 10,000 companies participating and developing on Windows 7 and committing their support," said Bill Veghte, Microsoft's senior VP for Windows development, who spoke earlier this week at the company's TechEd North America 2009 conference in Los Angeles.

"We need to make sure the ecosystem is really, really ready," Veghte said on Monday.

"This is something we spent huge, huge cycles on, and is something that at a personal level is one of the three biggest things where I've been putting a lot of time around making sure that we've got the right quality milestones," said Veghte.

Microsoft has good reason to be concerned about compatibility. Windows Vista's January 2007 debut was marred by the fact that a number major products from high-profile vendors like Adobe, Intel, IBM, and Symantec didn't work with Vista. Adobe, for instance, didn't release a Vista-compatible PostScript driver until months after the OS hit the market.

The glitches were a major reason behind Vista's failure to build momentum in the enterprise market, where software and hardware compatibility is a major factor in customers' purchasing decisions. Ultimately, only a handful of Fortune 500 companies upgraded their business PCs to Windows Vista. Most have stuck with the older Windows XP operating system.

Veghte said he's confident the problem won't repeat when Windows 7 rolls out later this year. "We are very, very close" to achieving full Windows 7 compatibility with virtually all major hardware and software players, he said.

Veghte disclosed that Microsoft expects to finish work on Windows 7 by about mid-August and make a final version of the OS available to consumers and businesses in time for this year's holiday season. The company is counting on the release to help it recapture momentum in the computer operating system market.

Microsoft recently reported that Windows sales slipped 16% in its most recent fiscal quarter.

InformationWeek has published an in-depth report on Windows 7. Download the report here (registration required).