Though it's not clear what kind of updates it would even contain, Microsoft told CNet that a third Service Pack for Windows XP will not arrive until the second half of 2007. This would be well after the release of Windows Vista, which is expected to ship in the second half of this year.
in other words. MS says, Buy Vista.
pretty much, yes.
but this will also allow ms to decide what features to add into xp that ship with vista, if any.