Users planning to run Microsoft Exchange on Windows Server 2008 and those contemplating in-place upgrades of the new server operating system coming out next week may face installation problems unless they heed specific advice from Microsoft.

The vendor is already warning users that the RTM version of Exchange 2007 cannot be installed on Windows Server 2008 and that it is impossible to do an in-place upgrade to Windows Server 2008 on a server running Exchange 2007 SP1.

Microsoft also has said "rolling upgrades" of failover clusters for Exchange are impossible.

Microsoft has published three migration options, including one long set of steps around off-loading data, uninstalling and reinstalling numerous Exchange components.

The other upgrade issue centers on a confusing dialog box that partners say could freeze administrators doing in-place upgrades and points to the fact that in-place Windows Server 2008 upgrades for application servers could be a crap shoot if not impossible much like Exchange.

The dialog box carries the message: "If you are using 3rd-party apps you are not supported" and will pop up during in-place upgrades from Windows Server 2003 to 2008 on servers running applications.

Microsoft acknowledges the existence of the dialog box, which was added during the Release Candidate beta cycle of Window Server 2008.

Microsoft partners say the vendor told them it made changes in the in-place upgrade procedures for Windows Server 2008, but Microsoft has not detailed those changes to partners.

The only supported option for in-place upgrades is when replacing servers that run core infrastructure services such as DNS, DHCP or Active Directory, according to Microsoft.

In other cases, Microsoft recommends before installing Windows Server 2008 that users uninstall third-party applications or applications that did not ship with Windows Server 2003 or that were not delivered via Windows Update. Once the server is installed, the applications and any corresponding data can be reinstalled, a similar procedure suggested with Exchange.

Microsoft officials say in-place upgrades are not considered a best practice and that most large IT shops do thorough testing before deployment.

"The majority of customers will do testing, but they will want to do an in-place upgrade because it is the least time-consuming," says one systems integrator who asked not to be identified. "If you wipe and reinstall, that is a lot more work."

Microsoft officials have begun to publish some of the guidance they are working on to educate users on in-place upgrades and say that many large users would initially encounter the dialog box during testing and not live deployments.

"Almost all of the in-place upgrades that we see are in the core infrastructure areas," says Alex Hinrichs, group program manager for applications server. "We don't think this will be a major issue for most customers. We feel good that customers will be very clear on whether their apps are in a supported state or not before they get to any type of deployment."

In addition, Hinrichs said Windows Server 2008 installs will likely be done on new hardware or hardware wiped clean for new installs.

Microsoft has no plans to change or eliminate the dialog box that says users are not supported.

"[Windows Server 2008] is not the kind of upgrade where you slip the CD in on Friday night and you are out of there by 9pm," says Al Gillen, an analyst with IDC. "That means it creates a longer adoption cycle, which Microsoft is a bit more realistic about then it was about Vista."

The issue with Exchange 2007 SP1, which shipped in November, was detailed on the Exchange blog in October under a posting titled; "Mission Impossible: In-Place Upgrading Microsoft Exchange Server 2007 from Windows Server 2003 to Windows Server 2008." The blog post described how the Exchange team tried an in-place upgrade and determined it could not be done.

The upgrade issue was first revealed by the Exchange team in August.

After the upgrade test failed, Microsoft issued three upgrade options.

The most involved option includes a number of steps that Microsoft outlined this way: "preserve the data on an existing server, uninstall Exchange, uninstall PowerShell, uninstall any other in-place upgrade blockers, upgrade to Windows Server 2008 (or perform a fresh install of Windows Server 2008), install PowerShell and other prerequisites, install Exchange 2007 SP1, use database portability or backup/restore, reconfigure the server, reinstall 3rd party applications, etc."

One other option is to "build a new server or cluster by doing a fresh install of Windows 2008, and then Exchange 2007 SP1, and migrate the mailbox data using the move mailbox tasks." The third option is identical except for the recommendation to use database portability and/or backup and restore to migrate data.

Microsoft also has said that given significant changes introduced into failover clusters in Windows Server 2008, rolling upgrades of a failover cluster from Windows Server 2003 to Windows Server 2008 also are not possible.

To upgrade a clustered mailbox server from Windows Server 2003 to Windows Server 2008, users will have to build a new failover cluster using Windows Server 2008 as the operating system for all nodes. Data will then need to be migrated from the old cluster to the new. Move Mailbox and public folder replication features can be used to move data to the new cluster.

While Microsoft has made this guidance available for Exchange/Windows Server 2008 migrations, the company is just starting to make the guidance available on in-place upgrades for Windows Server 2008 and other applications.

Windows Server 2008 is expected to be launched on February 27.