Microsoft doesn't plan to offer a version of Windows for so-called "smartbooks," leaving the space open to Linux, Google's Android and other operating systems.
Smartbooks are a new class of device built around ARM-based chips from companies like Qualcomm, Freescale Semiconductor and Texas Instruments.
A number of PC makers are working on smartbook designs, which are targeted at the space between smartphones and netbooks.
Microsoft's mainstream Windows operating systems are designed to run on the x86 instruction set used by Intel, and AMD and won't run on the ARM-based processors used in the new machines.
The company has no plans to port a PC version of Windows over to the ARM core, said Steve Guggenheimer, who runs Microsoft's original equipment manufacturer division, in a news conference at the Computex trade show in Taipei.
Microsoft does offer a version of Windows Mobile that is compatible with ARM chips but doesn't have plans to develop that for the technically more capable environment of a smartbook, he added.
In declining to do so it won't be following the path of Android, the Google-backed operating system, that first appeared on cell phones and is currently being tweaked to run on first-generation smartbooks. Several companies have shown Android-based smartbooks at Computex.
Guggenheimer was bearish on the potential market for the machines.
"It's hard to create new categories," he said.
Microsoft knows the difficulties well: It has tried several times to popularize tablet PCs with little success.
"We'll see what happens," he said.
Henri Richards, head of sales and marketing at Freescale, called Microsoft an important potential partner for smartbooks due to its place in the technology world, but added that he can't understand why the software giant wouldn't be interested in the budding device.
Smartbooks on display at Computex look a lot like netbooks, with 10-inch screens and full keyboards, but Richards said they provide a significantly different experience. They use components and chips currently found in smartphones that are built for power efficiency.
Smartbooks can run for eight hours with a three-cell battery, much longer than comparable netbooks, which require a much heavier six-cell battery for six to seven hours of battery life.
Smartbooks with 10-inch screens will also likely sell for around US$199 each for devices made for Wi-Fi wireless connections, he said, and more for devices made for 3.5G mobile networks due to some more expensive parts and the contracts they will require. Some phone companies may offer 3.5G smartbooks free with a contract.
Netbooks with 10-inch screens generally cost between $300 to $400, and much more with added features such as 3.5G modules.
Mobile phone chip makers including Qualcomm, Texas Instruments and Freescale are working together to popularize smartbooks, said Richards, and Android is an important step in their future development.
"Android is important because until now, the Linux ecosystem was lacking a brand," he said. The good Google name and strong makeup of Android make it a solid alternative to Windows, he said.