In what appears to be a serious contradiction, Microsoft has declared that the company will allow Windows 7 customers to downgrade from Windows 7 to either Windows Vista or, surprisingly, Windows XP. While it's a little unusual to allow formal across-the-board downgrade rights to a two-versions-old operating system, there is another tidbit of information that makes the situation more confusing. Next week, Microsoft ends mainstream support for Windows XP meaning that non-security related problems with the operating system can only be fixed by paying Microsoft through an extended support contract. Windows XP extended support ends in 2014, until which point Microsoft will continue to supply critical security fixes for the operating system.
So, your choice is to move to Windows 7, or to downgrade to Windows Vista, which has proven, rightly or wrongly, to be a flop in most circles, or to downgrade to an unsupported operating system. I don't envy Microsoft in this support conundrum. The company is between a rock and a hard place with this one. It's true that Vista has all but failed in the market. At the same time, it's true that Windows XP is just about as rock solid as they come making many people to just say no when it comes to moving to Vista.
Personally, I think Windows 7 will be the next Windows XP (read: I think it will rock) and that this issue will mostly go away relatively soon after the Windows 7 launch. People will mostly skip Windows Vista in favor of Windows 7 and Microsoft knows it; hence, the new downgrade policy as an interim measure. In my organization, if Windows 7 continues to look as good as it does now, we will be exactly in this boat; we'll stick with XP until we test everything on Windows 7 and then take the plunge where it makes sense.
The one remaining challenge that I see for Microsoft with regard to Windows XP lies in the realm of netbooks. Windows XP has proven to be the perfect fit in the netbook department, although a netbook version of Windows 7 is supposed to be in the works.