Remember that Steven P. Jobs came back to Apple because the company's effort to develop an ambitious new operating system, codenamed Copland, had failed. Mr. Jobs convinced Apple to buy his company Next Inc. for $400 million in December 1996 for its operating system.Note the tension - MSFT keeps hurting because of back-compatibility, but they don't want to dump back-compatibility because they feel they "can't get away with it." And MSFT is probably right - if people were suddenly faced with having to replace their old versions of Windows, Office, IE, Outlook, and all the other assorted programs that people rely on, consumers (and businesses) might simply decide it wasn't worth it, and either go with a Linux build, or go Apple. If you look at the costs to replace all that software, it might actually cost you as much as one of the new Mac Minis. (Though I'd have to check on that.)
It took Mr. Jobs and his team years to retool and tailor the Next operating system into what became Macintosh OS X. When it arrived in 2001, the new system essentially walked away from Apple's previous operating system, OS 9. Software applications written for OS 9 would run on an OS X machine, but only by firing up the old operating system separately.
The approach was somewhat ungainly, but it allowed Apple to move to a new technology, a more stable, elegantly designed operating system. The one sacrifice was that OS X would not be compatible with old Macintosh programs, a step Microsoft has always refused to take with Windows.
"Microsoft feels it can't get away with breaking compatibility," said Mendel Rosenblum, a Stanford University computer scientist. "All of their applications must continue to run, and from an architectural point of view that's a very painful thing."
The only thing Windows has left for it is a sense of corporate comfort - even people who never use MSFT's "support" functions are comforted by the idea that it's there. Being forced to abandon all the old software could seriously damage MSFT's brand, in other words.
I'd just like to point out at this time that you can buy "Beginning Ubuntu Linux" at Indigo.Chapters.ca (I'm a corporate whore) for just under $32. It comes with the OS. So the choice is - well-reviewed $32 book explaining how to use powerful new OS, or several hundred dollars for the next version of Vista, with no guarantee that you'll even know how to use the damn thing.
I have no doubt that most businesses and consumers - even when there's no need for Windows compatibility - will continue to pay the MSFT tax. Who ever said the market was rational?
Update: Oops, forgot to add the link. Fixed now.