Microsoft released for download on April 26 a public beta of the Windows Home Server ‘Vail’ release.

In January, a Community Technology Preview (CTP) of Vail leaked to the Web. According to the description of that download, Vail, the next version of WHS built upon “both on-premises and cloud technologies” for home and SOHO (small office/home office) users.

Today, Microsoft officials shared some high-level overview information about the Vail release, but very few specifics.

Officials did confirm that Vail will be a 64-bit product only, according to a blog post on the Windows Home Server blog. Company officials said to expect Vail to include improvements “in four key areas,” including the extension of media streaming “outside the home or office”; improvements of multi-PC backup and restore; simplified setup and user experience; and expanded tools and customization capabilities for partners.

The beta is available in English only, and includes a new software development kit (SDK) who want to create add-in applications for Vail. Vail requires systems with a 1.4 GHz x64 processor, 1 GB RAM, and at least one160 GB hard drive. The product is expected to be sold preloaded on OEM/system builder PCs only.

According to one customer who has been dabbling with early builds of Vail, Vail will be built on top of Windows Server 2008 R2, and will support “transparent ‘virtual’ (remote) applications.”

“Windows Media Center currently does not support transmission of some protected content – for example HD premium content from a cable card – on remote systems, with the exception of xbox,” said the customer, who asked not to be named.

“That’s because the DRM chain gets broken by conventional streaming,” the source continued. “If you combine a trusted media chain in the server with a virtual app which can verify the integrity of the DRM chain on the client from the transport through to the display, then you can display protected content just as Xbox does. Then you can watch that high def football game in your hotel room, if you have the bandwidth. That’s pretty cloud-like. The same mechanism would support other cloud-style apps if they are enabled on the server. The combination of an untouchable virtual app and the ability to verify client side security capability is powerful – it gets around many thorny issues.”

Microsoft officials are not providing a final ship-date target, but I’ve heard it the product is likely to ship this calendar year.

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When Microsoft Chief Software Architect Ray Ozzie outlined his suggestions for Microsoft’s gameplan back in 2005 (via his “Internet Services Disruption” memo), he was a big advocate of Microsoft introducing ad-supported, free software and services. Since that time, Microsoft has been dabbling with ad-supported products on a variety of fronts, including the forthcoming consumer version of Office Web Apps and Office Starter products.

But what about Windows? Would Microsoft ever go so far as to offer a low-end SKU of Windows client that would be free, but ad-supported? Back in 2005, a Microsoft researcher authored a ThinkWeek paper detailing how and why Microsoft could make Windows an ad-supported product. But I never thought anything came of that paper… until now.

Stephen Chapman, the blogger behind the Microsoft Kitchen blog, unearthed an interesting screen shot of a Microsoft employee’s LinkedIn profile that mentions a “prototype for advertising in Windows” project, codenamed “Madison.”

Based on that profile, it seems Lead Program Manager Krista Johnson spearheaded two Microsoft incubation projects between 2005 and 2008. One was Madison and the other was a prototype Windows CE-based PC that would sell for under $100. (The latter sounds like some kind of ultra-low-cost PC/”Origami” device.)

There’s no word whether these prototypes went anywhere. But now I’m wondering whether Microsoft might release some time in the coming months/years a free, ad-supported Windows SKU. Maybe it will be more like Office Starter, in that it will be a stripped-down subset of Windows, preloaded on new PCs, that includes the ability to move up to a paid, more fully-featured version (using the current Anytime Upgrade model).

Or maybe something like Madison will be the new alternative to Windows Starter Edition? If it is, I wonder how Microsoft will make up for lost revenues, as it currently charges OEMs $30-plus per copy for Starter preloaded on netbooks, according to various estimates….

I’ve got a question in to Microsoft about whether the company has ruled out the idea of an ad-supported Windows release. I’m not expecting much of an answer, but I’ll post what I get here.

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The Twitter bug has spared no one. From A-list Hollywood actors to A-list Bollywood actors to politicians and now Bill Gates who’s finally discovered Twitter. His first Tweet was: “Hello World. Hard at work on my foundation letter — publishing on 1/25.”

Bill (ionaire) Gates, who generously shares his millions with the less privileged already has 271,723 followers and was welcomed by serial Tweeter Ashton Kutcher who himself has a 4 million followers.

If Twitter isn’t your thing then Bill Gates has also announced a full fledged website called Gates Notes where he will share his thoughts on his foundation work, his travels and what he’s learning.

Gates did have a Facebook account at one point but was so bombarded with friend requests that he closed it down. Reports state that he’s back on Facebook.

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Microsoft Corp’s Bing search engine won more market share from rivals last week, according to new industry data released on Wednesday, but still trails Google Inc and Yahoo Inc.

Challenging market leader Google — which in turn is looking to break into Microsoft’s core software market — is a long-term project, said Microsoft chief executive Steve Ballmer.

“We have had some very good initial response,” Ballmer said at a conference in Detroit. “I don’t want to over-set expectations. We are going to have to be tenacious and keep up the pace of innovation over a long period of time.”

Microsoft grabbed 12.1 percent of U.S. Internet searches for the work week June 8-12, according to data released by industry tracker comScore earlier on Wednesday.

That is up from 11.3 percent in the June 1-5 period — the week in which Bing was launched — and up from 9.1 percent the week before that.

For comparison, Google got 65 percent of U.S. searches in May, the last full month for which figures are available, followed by Yahoo with 20.1 percent and Microsoft with 8 percent.

Analysts and investors are keenly awaiting data for all of June to see if Microsoft can hold onto early gains.

Ballmer acknowledged the tough task of beating Google, which he referred to as “a big dog competitor.”

The world’s largest software company has long been determined to play a major role in the lucrative Web search market after watching upstart Google take a stranglehold.

At the same time, Google is looking to take advantage of its popularity to launch software that competes with Microsoft’s, which has created a new source of tension between the two companies.

Microsoft ratcheted up that tension on Wednesday by claiming that Google’s new Apps Sync for Microsoft Outlook software — which allows users to share data between their Outlook e-mail and Google’s online offerings — disables a key function in Outlook.

“The installation of the Google Apps Sync plugin disables Outlook’s ability to search any and all of your Outlook data,” Outlook product manager Dev Balasubramanian wrote on a Microsoft blog. “It is also important to note that uninstalling the plugin may not fix the issue.”

The problem, though relatively unimportant to users, represents a crucial struggle between Microsoft and Google for e-mail customers.

Google’s new product allows business users to continue using Outlook for email and other tasks, but the back-end functionality and data storage moves to Google, instead of residing on a company’s internal servers running Microsoft software.

Google acknowledged the Outlook problem identified by Microsoft, and several other issues where its software does not mesh well with others.

“We’re working with Microsoft and other partners to help fix these issues and support additional Outlook features like multiple calendars,” said Google Apps senior product manager Chris Vander Mey in a blog post. “We’ll keep you posted on our progress.”

Microsoft shares closed up just less than 1 percent at $23.68, while Google’s fell 0.2 percent to $415.16, both on Nasdaq.

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