The short interest in Microsoft fell in February by 30.3 million shares to 78.2 million, a big drop. Investors must have decided that betting against Vista and Xbox was a bad idea.

Although Microsoft (MSFT) has tried to mute expectations for Vista, it appears that over the medium term it will do extremely well and challenges from competition like Google are likely to fail.

Microsoft also seems to be making a smart play by moving into mobile software with Mobile 6 just as broadband wireless is hitting its stride.

Douglas A. McIntyre