XP and smart tags - Microsoft at it again?

Microsoft is the most scrutinised company in this or any other industry. Rightly so.

After all, its track record is suspect. Decisions to bundle Internet Explorer into Windows and sell server operating systems as a pre-requisite of their desktop equivalents are well known.

Equally well known is the Microsoft defence: "We're innovators working in the interests of our customers." Most critics dismiss this as a smokescreen for blatant anti-competitive behaviour.

Just this week the suggestion that XP will feature Instant Messenger as standard has rekindled the bundling debate. Naïve, it would seem, given the Court of Appeal's imminent verdict on last year's ruling to split the company in two.

Yet despite this background, Microsoft may just come up with a technology that really is 'innovative' and genuinely useful.

The technology is called Smart Tags and, as we report elsewhere on silicon.com today, it points users to relevant information within other applications or on the web. As you write in Word or feed data through Excel, XP will highlight related information from your computer or beyond and give you the option to include it in the finished document.

Type a stock ticker symbol in an Excel cell, for example, and XP will immediately offer a link to the share page on MSN. Simple, neat and code-free.

It's a concept that's well known to web users. Read anything on silicon.com and we'll supply links to related stories. Microsoft is adapting this simple idea and putting it into run of the mill applications.

So, two cheers for Microsoft. We'll hold back the final cheer until Microsoft can convince users it doesn't plan to manipulate this device. Critics believe Smart Tags is nothing more than an impression generator for Microsoft-owned websites. They say the company will pre-ordain the data sources XP will reference and data it will ignore.

But if Microsoft delivers this technology in an open manner it will deserve undiluted praise. The world will be watching.