Dear customer:
Transition is the scenario in which you upgrade an existing Exchange organization to Microsoft Exchange Server 2007. To perform the transition, you must move data from the existing Exchange servers to new Exchange 2007 servers. For example, when upgrading from an Exchange Server 2003 or Exchange 2000 Server organization to an Exchange 2007 organization, you perform a transition.
When transitioning to Exchange 2007, you cannot perform an in-place server upgrade on an existing Exchange server. Instead, you must install a new Exchange 2007 server into the existing organization, and then move data to the new Exchange 2007 server.
Additionally, for more information about how to upgrade previous Exchange organization to Microsoft Exchange server 2007, please refer to the following links:
Upgrading to Exchange 2007
http://technet.microsoft.com/en-us/library/bb124008(EXCHG.80).aspx
http://www.msexchange.org/tutorials/Transitioning-Exchange-2000-2003-Exchange-Server-2007-Part1.html
http://www.msexchange.org/tutorials/Implementing-Exchange-Server-2007-coexistence-Exchange-Server-2003.html
Hope it helps. If anything is unclear, please feel free to let me know.
Rock Wang -MSFT
