DailyTech reported earlier this morning that Microsoft is in a bit of a pickle with regards to end-of-sale date for Windows XP and the rise of low-cost sub-notebooks. Microsoft needs an operating system to combat the various iterations of Linux that come pre-installed on these machines and Windows Vista won’t suffice given current hardware requirements.

Sources close to Microsoft are now stating that the company is expected to extend the availability of Windows XP specifically for low-cost notebooks (i.e., Eee PC, CloudBook, etc.). Although Microsoft declined to comment on the report, the sources said that the announcement could come as early as this week during the Intel Developer Forum (IDF) which is taking place in Shanghai.

An announcement at IDF would make perfect sense as the show is a showcase for Mobile Internet Devices (MIDs) and notebooks using Intel’s new Atom processors. Intel’s Atom processors are targeted at MIDs, sub-notebooks and even low-end desktop machines.

Source: DailyTech