During an internal meeting in Taiwan, Intel CEO Paul Otellini allegedly stated that Microsoft is prematurely releasing Windows 8, as improvements are still needed before it can deployed.  But he also mentioned that it may be the right move, as many products are released before they are fully baked, ready to make adjustments along the way.

Michael Cherry at Directions on Microsoft also agreed with Otellini’s statement, staying that Windows 8 “lacks a wide range of robust applications and PC makers haven’t had enough time to work out kinks with so-called drivers, which connect software to such hardware as printers.”

The problem with releasing a half-baked product, like Microsoft’s Vista, is that there were a lot of kinks to work out and it did not work with a lot of applications and drivers.  The result was a lackluster launch and little uptake by consumers or the enterprise.

Though Otellini may have bashed Windows 8 in an internal Intel meeting, a spokeswoman for the company, Laura Anderson, stated that Intel “believes Windows represents a tremendous opportunity for our business and we’re looking forward to working with Microsoft on enabling a host of new experiences on a variety of devices.”

As for Microsoft, they believe that their new OS is ready for release.

“With over 16 million active preview participants, Windows 8 is the most tested, reviewed and ready operating system in Microsoft’s history,” said Mark Martin, a spokesman for Microsoft.

If you’re waiting for the release of an Intel-Microsoft tablet, you might have to wait quite a while longer as, according to sources, Intel delayed delivery of software needed to conserve computer battery life.  The delay caused a hold up in the development of some tablets running Windows 8.   Also, Microsoft hasn’t approved tablets featuring the Clover Trail processor because of the missing power-management software.

This does not look good for Microsoft, especially with the fact that the PC business is not that profitable since consumers are beginning to prefer tablets over PCs.  Also, the conflict between Intel and Microsoft won’t help them compete with Apple’s iPad, which is currently the dominant tablet on the market.

“The PC channel is in chaos right now,” said Alex Gauna, an analyst at JMP Securities LLC in San Francisco. “They don’t know what to do. They don’t know what to design for, they don’t know what the consumers are going to buy. Tablets have stolen their growth trajectory, plus the macro situation, plus Wintel has made a mess of their ecosystem.”

But in a recorded statement, Otellini stated that “Windows 8 is one of the best things that ever happened to Intel,” citing the importance of the touch interface coming to mainstream computing and the huge wave of exciting new Ultrabook™, tablet and convertible device innovations coming to the market.

Intel and Microsoft has a long history of delivering devices that provides consumers with quality experience and stunning performance.  So whatever Otellini stated in their internal meeting, it’s highly unlikely to affect their partnership.