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Developers gathered in Los Angeles for the Microsoft Professional Developers' Conference will hear how Yukon will be integrated more closely with the Longhorn release of Windows.
Microsoft's aim is to produce a new file system for Windows based on SQL Server, a goal the company first mooted in 1994 as a feature within the "Cairo" NT5 release of Windows NT. The technology failed to appear in Windows 2000 or Windows 2003.
Butler Group analyst Mike Thompson said incorporating the SQL Server database technology into Microsoft's operating system had presented the company with a technical challenge.
Developers at the conference will hear how Microsoft resolved the issues with the development of Windows Future Storage.
The technology promises to improve the speed of searching for information on a PC's hard disc, by taking advantage of the superior storage and search capabilities within a relational database engine such as SQL Server. No other operating system uses a relational database as the file system in this way.
According to Thompson, the complexity of linking SQL Server with Windows has been one of the main reasons that Yukon has not yet been released.
Thompson said the four-year delay since the last release of SQL Server in 2000 was a huge time lag for Microsoft users.
"People on the Microsoft Software Assurance programme expected a new release of the SQL Server software during the term of their Software Assurance contract," he said. But the new version of SQL Server, codenamed Yukon, is not expected until 2004.
Meta Group has also raised concerns over the value of Software Assurance, particularly relating to the release of Longhorn. Meta analyst Kurt Schegal said businesses that had bought a three-year subscription in Q4 2001 would see their upgrade rights expire before the next version of Windows was released.
Microsoft will also use its Professional Developers Conference to outline extensions to the .net framework for creating web service applications that run on Windows-based computers.
Codenamed Indigo, the next release of the .net framework will provide message queue and transaction processing, functions previously unavailable in .net,according to Ovum research director Neil Macehiter.
He said, "Indigo pulls together a number of enterprise components." This makes .net a viable alternative to Java 2.0 Enterprise Edition.
Microsoft's .net framework is generally perceived as less enterprise ready than Java-based application servers such as BEA Weblogic and IBM Websphere.
However, Meta Group analyst Michael Barnes said that as .net matured and gained traction among Global 2000 organisations, price and performance of the platform relative to J2EE would remain a differentiator.
"Organisations should focus on Microsoft's migration services to Visual Studio .net and web services support for simplifying integration with legacy or J2EE platforms as areas for improvement," he said.