Microsoft have confirmed that Windows XP Starter Edition will be released in October and targetted at the Asian market. At the moment Starter Edition is a crippled version of Windows which lacks functionality for the average user. Users who will buy Starter Edition won't be able to use more than 3 windows at the same time, some keyboard functionality is restricted, no file-sharing, no print sharing and no support for local area networks.
The whole idea around Starter Edition is to market a cheap version of Windows that end users will buy and then to convince the user to upgrade to the full version of Windows. It's not clear just how cheap Microsoft are planning to make Starter Edition at present.
Could Microsoft eventually start using this tactic worldwide? If all goes well in India then this pilot scheme would eventually make its way into the United States and Europe. Industry analysts like Gartner are labelling Microsoft's Starter Edition as a "steer away" product. Time will only tell.