Microsoft will be extending the Windows XP downgrade option until 2011. While Microsoft has threatened to halt the option on numerous occasions, it has yet to set a date, write it in stone and actually make good on the promise.
Windows XP has been the corner stone for Microsoft as Windows Vista was largely rejected by businesses and consumers due to its initial rocky start. With Windows 7 right around the corner Microsoft will be looking to phase out XP but still must do so in a cautious manor.
The reason behind the extension was that the Windows XP downgrade option was originally set to take place 6 months after the launch of 7 and business that have large scale Windows XP deployments may not be ready to convert to Windows 7 in as little as six months, or at least stop purchasing OEM systems with it as an option. As a result, the option to downgrade to XP has been extended to 2011. Enterprise customers on Microsoft's Software Assurance program can downgrade Windows 7 licenses all the way back to Windows 95 or Windows NT 3.51.
Windows XP has been given an extended stay of execution but its not expected Microsoft will keep the dated OS on life support forever. With Windows 7 receiving high praise for its stability and usability, look for corporate wide rollouts of Windows 7 in the next 12-18 months.