As Microsoft Corp. prepares for the upcoming release of its Windows 7, Japanese manufacturers of personal computers are hoping the latest operating system will be the long-awaited silver bullet for a market hammered by eroding prices and flagging demand.

For the U.S. software giant, the success of Windows 7 will be critical to repairing a reputation bruised by its disfavored predecessor, Vista, especially at a time when Microsoft faces growing threats from rivals Google Inc. and Apple Inc.

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