Scarcely a week after Bill Gates parceled out his technical responsibilities to two top deputies, Microsoft put an end to one of his longstanding pet projects--a super file system that could help unify the company's many products.

The decision to pull the plug on WinFS, which has roots in ideas that stretch back at least a dozen years at the company, illustrates how Microsoft may be rethinking the scope of its operating system as it prepares for an era in which data stored on the Web becomes as important as information on a PC. Not coinci- dentally, Microsoft needs to simplify a lumbering development process that has led to repeated delays of its next big upgrade, Windows Vista.

On June 23, Microsoft said WinFS won't become a future feature in its operating system. The file system was supposed to serve as a relational database inside Windows that would let PC users graphically manage documents, images, contacts, and other data and introduce common commands for searching across programs. The software once was slated for inclusion in Vista, due in January, then promised as an add-on. Microsoft now says it will adapt parts of WinFS for inclusion in the next versions of its SQL Server database and Visual Studio programming tools.

The decision to deep-six WinFS won't have much immediate impact on Microsoft's customers. Desktop search technology that Microsoft provides for Windows XP--and that's been improved for Vista--and hard-drive search tools from Google and others perform many of the functions WinFS was supposed to. And many IT managers factored WinFS out of their plans when it was delayed two years ago. "Microsoft definitely screwed up here," says Jon Rauschenberger, CTO at Clarity Consulting, a software development company. "But WinFS wasn't a fully baked product. We certainly weren't telling our customers to invest in this."

Microsoft's reversal shows how software released over the Web is eclipsing the company's ability to crank out new features for the desktop. Gates touted WinFS for years as a panacea for the tangle of files on PCs, yet desktop search engines now provide ways to organize information that obviate the need for a more sweeping approach. "The right feature at the wrong time is still a bad feature," says analyst Michael Cherry, with Directions on Microsoft.

On June 15, Gates divided his technical responsibilities between Ray Ozzie, whom he named Microsoft's new chief software architect, and Craig Mundie, promoted to chief research and strategy officer. Gates said he would leave his daily role at the company in two years. Ozzie has talked about the need to redesign Windows and other Microsoft products to reflect workplace trends and speed innovations to market.

Still Touting Search
Yet Microsoft still intends to tout as a key Vista selling point its ability to find data more easily on a PC's hard drive. "We took a giant step forward in search and organization," says Corey Thomas, a group product manager for SQL Server at Microsoft.

It's not junking the technology entirely. Microsoft is plucking the "more mature" parts of WinFS for further development, Thomas says. The next version of SQL Server will be able to extract metadata from documents and photos on a PC and relate those files to back-end business data. And Visual Studio will get a version of Microsoft's ADO.Net technology (for pulling data from XML and SQL Server sources) that includes WinFS "entities," objects describing business concepts that can be organized in a database table.

Thomas held out the possibility that a relational file system could yet appear in Windows in the future. Customers aren't holding their breath.