Refers to software that runs not only on the computer for which it was designed, but also on newer and more powerful models. For example, a program designed to run on an Intel 386 microprocessor, which also runs on a Pentium, is upward compatible. Upward compatibility is important because it means you can move to a newer, larger, and more sophisticated computer without converting your data.
In contrast to upward compatibility, downward (backward) compatible means that a program runs not only on the computer for which it was designed, but also on smaller and older models. For example, a program designed to run under MS-DOS 6.0, which also works under MS-DOS 5.0, is downward compatible.
Upward compatibility is sometimes called forward compatibility.
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