Microsoft made an exciting announcement about a previously unknown feature for the upcoming Windows 7 release: Windows XP Mode. Microsoft's own announcement is short and detail-less...

Coming Soon: Windows XP Mode and Windows Virtual PC

Fortunately, Rafael Rivera and Paul Thurrott provide much more information on SuperSite for Windows...

Secret No More: Revealing Windows XP Mode for Windows 7

Windows XP Mode uses virtualization technology to create a virtual machine to create a true compatibility mode for legacy Windows software. However, if you are a netbook user, there are two reasons why you won't be using it when it becomes available...

1. Windows XP Mode requires hardware virtualization assist in the form of Intel's VT-x or AMD's AMD-V technology. The vast majority of current generation netbooks use the Intel Atom N270 processor or the newer N280 processor. Neither one provides VT-x hardware virtualization assist. However, if your netbook uses the Intel Atom Z530 (as some higher end Dell netbooks do), you are in luck. It provides VT-x support and should support Windows XP Mode under Windows 7.

2. Most netbooks will probably ship with either Windows 7 Starter Edition (a non-starter in my opinion) or the more capable and reasonable Windows 7 Home Premium Edition. Unfortunately, Microsoft's announcement states that it will only be available in Windows 7 and Professional Editions (Rivera and Thurrott's article adds Enterprise Edition - which makes sense). So, you will not be able to use Windows XP Mode even on an Atom Z530 based netbook if you are using Starter Edition or Home Premium Edition.