Microsoft preps StartKey A 'Windows companion' o

Microsoft has some big options for the small-sized storage units.
Microsoft is functioning on turning USB-based flash drives into a “Windows companion” — a new product known as “StartKey” — that will allow users to carry their Windows and Windows Live settings with them.
StartKey isn’t just for USB sticks; it also will work on other flash-storage gadgets, like SD memory cards. Microsoft is looking to turn these intelligent storage products portable “computing companions” for users in both developed and emerging markets, with availability (at least in beta form) likely before the end of this year, according to sources who asked not to be named.
Microsoft’s goal is to build an end-to-end StartKey environment — comprised of everything from system software on the flash devices, a software development kit to enable third-party developers to create products that can leverage StartKey, and accompany Microsoft applications and services, sources said.
StartKey has its roots in an agreement Microsoft forged with SanDisk in May 2007. Microsoft announced it would be providing unspecified software to replace the U3 Smart Technology that was included on SanDisk flash products. U3’s technology enabled users to store files, applications and related settings on their USB sticks.
StartKey will make these flash devices more Windows-centric. StartKey devices will be customized to plug into Windows machines. They will allow users to bring everything from their desktop wallpaper, to their desktop icons, contact lists and data with them so that they can turn any PC or kiosk into their own, personalized workspaces.
Customers in developing nations are going to be a prime target for Microsoft with StartKey, my sources say. In these markets, StartKey becomes a way for Microsoft to reach billions of users in developing countries who might not have their own Windows PC at home, but who can get access to one at school or can log on via a shared Internet kiosk.
Microsoft has working with the One Laptop Per Child (OLPC) team and various PC partners to test if and how Windows XP can run on Linux-based XO laptops. One of the favored solutions is to enable XP and other Microsoft software to run on an SD card that will be inside the XO.
When I asked Microsoft’s Unlimited Potential team whether StartKey would be the way Microsoft delivers Windows on XO machines, a company spokesperson said there was “no connection.” However, the spokesperson added: “As mentioned previously, Microsoft plans to publish formal design guidelines in the near future to help all flash-based device manufacturers design machines capable of a high-quality Windows experience.”
(For those of you who, like me, are still wondering why XO users would want/need both Linux and Windows on these machines, here’s the official response from the aforementioned spokeswoman: “Obviously, there would be a variety of reasons for governments and other purchasing bodies to choose XP–strong Windows ecosystem support, increased availability of educational software, and an strong connection to job and economic opportunity, among others.”)
But back to StartKey. Microsoft has started talking up its StartKey vision among potential OEM partners. In the developed world, Microsoft is positioning StartKey as being securely and seamlessly integrated with Windows-based PCs and Windows Live services, I hear.
To me, StartKey sounds like an idea that might have gotten its start as part of a Microsoft Research project I heard about a year or so ago, codenamed “KeyChain.” Here’s Microsoft’s description of how KeyChain would work:
“Tomorrow’s mobile computing environment might see a proliferation of public-use (kiosk) machines where users can simply and easily call up their desktop environments. This vision offers an alternative to portable computing that doesn’t require users to carry bulky, fragile, and theft-prone laptops. We posit that kiosk machines are capable of hosting users’ desktops as virtual machines and propose a virtual disk design. The virtual disk design allows for an efficient access to per-user state held ‘in the network.’ We use flash-based disks to capture virtual machine memory state and to act as a cache for the virtual disk. We also allow static portions of the virtual disk, e.g., binaries for Windows and Office, to be served from the kiosk disk.”
How much of Windows itself (if any) will be on the StartKey units? When will they hit the market and how much will they cost? Will virtualization technology figure into the StartKey equation? I don’t know. But I do know StartKey is in full-steam-ahead mode.
Do you think customers here and in emerging markets will bite?