After 12 years of work, the first beta version of Wine (WINE = Wine Is Not an Emulator) , entitled "version 0.9", has been released today.
Wine is a free software implementation of Microsoft's Win32 API.  This means that it enables non-Microsoft operating systems to run software that was written for Microsoft's operating systems. Wine is not just a simple emulator, but a complete rewrite of the whole Windows API and standard libraries (DLL's).
Written by a community of developers, which includes some companies whose businesses are based on it, Wine runs on POSIX compliant operating systems such as GNU/Linux and Unix-based operating systems. Wine allows a user of one of these operating systems to run Windows applications without having a copy of Microsoft Windows.
As the beta term suggests, more work is expected before the final release is made. The pre-release status of the software has not prevented some from using it for years to run a wide range of software, including modern games, office software, and news reading applications.
Wine is seen by advocates as an important tool for enabling people to migrate generally away from Microsoft's Windows operating system, or specifically to free software operating systems such as GNU/Linux and FreeBSD.  If a piece of software that is important to a person or business is only available for Microsoft Windows, it can tie that person or business to using Microsoft Windows.  Software such as Wine can free people of such ties (sometimes termed "vendor lock-in").
Wine is distributed under the terms of GNU Lesser General Public License.  This means that the software can be freely used and redistributed, and its source code can be studied, modified, and redistributed. It can also be integrated into software that does not grant these freedoms (proprietary software).
There are no direct competitors to Wine.  The two most related software packages are VMware and Win4Lin, but neither is free software, and both require that a copy of Microsoft Windows is installed.  Rather than working as an emulator, they allow for more than one operating system to be run simultaneously.
Two related products that are based on Wine are CrossOver Office and Cedega.  Each is the flagship product of a company, CodeWeavers focusing on office and TransGaming Technologies focussing on games emulation, respectively.  
While neither product is entirely free software, CodeWeavers do contribute their modifications to the Wine software back to the Wine community.
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First beta of Windows API 'Wine' released