A bunch of crap.
Businesses will get on it once M$ gets their release schedule back on track, as it often does pay to be on the bleeding edge when you're getting new hardware or upgrading.
Home users want to pay for the hardware and be done. With $500 PCs you can actually use (Celeron/Duron), I don't see it becoming free. I can see it coming down to $300 by '06 or '07, but not free.
I can also see small cost payments for those update CDs, given how many people are still on dial-up. Frankly, such thing is a good idea even if costing slightly. $10-$15 for six months of updates puts it about where AV updates are.
When subscriptions have worthwhile uses, like security and driver updates (hint hint), we take them. When was the last time you complained about $30 a year for AV? Right before you got that trojan.
While we're on the subject, you could say that one day, TVs would be free, and you'd just pay for cable. Oh, wait, no, but you'd pay for cable and not get ads. No, no, you pay for cable and get ads, but rgeuylated heavily. No no, we lied, you're paying for the hardware, service,
and getting ads where you could have 50% more content instead.
Linux will be a competitor on the desktop. Not the home, but corporate. Still too much crap for home use, but for business use, it's basically here, and needs marketting and trials to get management on the bandwagon. Novell is making insanely big pushes to this as well.
For home use, XP is where it's at. I'm afraid that's basically all there is to it. If your video doesn't work right, you get dropped to anything from 512x384x4* to 800x600x8, and can try again...not dropped to a command line. Simple things like that are hurdles that MUST be dealt with.
* I know 512x384x4 shouldn't exist, but it happened to me once in XP with a bum video card, so don't be saying it doesn't
.