October 12, 2004 1:15 PM PDT

Microsoft opens Windows to the home

LOS ANGELES--After trying for years to make the case that its products belong in the living room, Microsoft has decided its best approach is to tackle the whole house.

Although Apple Computer's combination of iTunes and iPod has proven pretty popular, Microsoft is betting that people want to do more with their music and that they want to be able to move video and pictures around as well.

Chairman Bill Gates made that case at a tony press event at the Shrine Auditorium here. With the help of singer Queen Latifah, Gates showed off a host of gadgets that use one or another Microsoft technology to access movies, music and video.

"What we've got here is an ecosystem," Gates said. "It's got partners, its got platforms, and it's got lots of choice. It's not just one device but all the different devices you want now and into the future."

Homeward bound

With several updates for its home entertainment software, Microsoft is homing in on digital media.

Windows XP Media Center Edition 2005: A new version of the entertainment operating system supports multiple tuners, online scheduling of recordings, a new movie-finding feature, CD and DVD burning from within a remote-control interface, and limited support for digital and high-definition TV.

Media Center Extenders: These set-top boxes enable people to watch TV and videos that are stored on a Media Center PC in a separate room.

MSN Music: Microsoft's online store moves from testing to formal launch, gaining exclusive rights to AC/DC's music collection.

Windows Media Player 10 Mobile: The first two devices to support the mobile version are an Audiovox Smartphone and a new Pocket PC from Dell.

Source: Microsoft

At the center of Gates' case is Windows XP Media Center Edition 2005--an update to Microsoft's entertainment-oriented operating system. As earlier reported, the updated version of the operating system adds a number of new features, including support for multiple television tuners. A new MSN utility lets customers schedule TV recordings over the Internet.

Among the PCs that will run the new operating system is Hewlett-Packard's stylish Digital Entertainment Center, which the company introduced last month in Miami. There are also a number of other living-room boxes, desktop PCs and notebook computers that will run the software, including systems from Toshiba, Dell, Gateway and Sony, among others.

A host of companion products are also set to make their debut. There are set-top boxes, handheld devices and media receivers--all of which can access the same movies, music and photos stored on a single Windows XP-based computer.

The stakes are high for Microsoft. The digital revolution is happening, with or without the company, and Microsoft is certainly hoping for the former. Digital cameras are relegating film cameras to dusty shelves and TiVos are replacing VCRs. And where CDs, albums and casettes were once the home to music collections, Americans now have 10 billion music tracks on their computer hard drives.


Commentary
No rush to the Media Center
Forrester Research predicts that
version one of Windows Media
Center Extenders will fail
to excite most consumers
this holiday season.


The prior incarnations of Media Center sold about 1 million copies, Gates said, adding that this version should prop that up by a factor of four or five.

"We are moving media center into the mainstream," Gates said.

Will Poole, senior vice president of Microsoft's Windows Client business, said now is the time for that move. "We look at all of those things and we say the market is hot and consumer interest is hot," Poole said prior to Tuesday's event.

At the same time, Microsoft and the PC industry need something to drive computer sales until the arrival of Longhorn, the next major version of Windows in 2006.

Making music
On the music side, Microsoft announced the formal launch of its MSN Music store as well as the fact that the store will start selling music by heavy metal group AC/DC--a longtime holdout in the digital music market. The company is touting several new media players that support subscription-based music as well as the first two devices that come with Windows Media Player 10 Mobile--the Audiovox SMT5600 Smartphone and Dell's Axim X50 Pocket PC.


TV viewing is central to Media Center 2005.
To help sort out all the devices and services that work together, the company is touting its "Plays For Sure" program, which guarantees, for example, that a device with the Plays For Sure logo will play any music bought at an online store that displays the insignia.

While Apple's iPod and iTunes Music Store have so far proved more popular, Poole thinks that Microsoft will eventually win the day. But, he said, it will take some time before Microsoft-based players and stores are viewed in the same light as Apple.

"All of that flexibility plus the choice of devices will start to begin to kick in this holiday season in terms of volume and will just escalate over the course of next year," Poole said.

Part of Microsoft's challenge, Poole acknowledges, is that its options have lacked the simplicity others have offered. "Frankly, the Microsoft ecosystem has had more complexity in the past than consumers need to see going forward."

Photo gallery
Windows of opportunity
At Microsoft's LA bash, the stars
are the new Media Center PCs.
With Media Center Edition 2005, Microsoft is dipping its toe into the world of digital television. For systems in the United States, Microsoft is supporting recording high-definition TV, but only for free, antenna-based signals. Poole said the reason is that cable and satellite providers have not yet provided access to their high-definition signals.

Although TV recording continues to be a major focus of Media Center, Microsoft decided to allow computer makers, for the first time, to offer devices with no tuner at all.

Poole said the move will allow computer makers to offer machines that cover nearly the full range of prices, with low-end machines starting in the $600 range and the fanciest of machines costing more than $2,000.

Breakout performance?
As a result, Microsoft is counting on Media Center moving out of its niche share of the consumer PC market.

"We certainly will move from single-digit to double-digit percentages, there is no question about that," Poole said. "How big of a double digit I'm not sure I know."

Related story
Media Centers on parade
Dell, HP, Gateway and more take
the wraps off new media centers.
Although the company would like to see the premium Media Center edition capture an ever-larger share of the consumer market, Poole said he doesn't see a day in the near future where Media Center, or its features, just become a part of Windows' home edition.

"There still will be customers that want the simple and basic, and we want to address their needs as well," Poole said. "It's going to be more than 10 percent this year, but when is it going to be more than 50 percent, I couldn't tell you. We are headed in that direction."

In addition to adding features to Media Center, Microsoft has also had to invest time on the basics, some of which were less than adequately handled in past Media Center releases. Chief among these is video quality, which in many cases was inferior to DVD players that cost less than $50.

"Video quality is a huge priority for us," Poole said, noting that the company was constantly testing the new OS to make sure it was comparable or better to such consumer electronics rivals as TiVo. "I expect this will actually be a strong selling point for Media Center going forward now, rather than an area to question, as it has been in the past."

6 comments

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Future???
The new media center PC is fine, but where's the HDTV interface??? I want to use a PC to record HDTV!!! The future is HDTV. The people who have the money to spend on a computer for their entertainment systems are the one's who buy HDTVs. The manufacturers are cutting their own throats. I've only seen one that offers it yet.
Posted by guebs007 (6 comments )
Reply Link Flag
What a load of bs......
I find it incredably fascinating that Bill Gates can just completely overlook the RIAA and their fight to make sure that the music I have is theirs and NOT mine. Gates wants me to be able to move that music around my home! HA! This is complete nonsense. People have so much music on their harddrives because of P2P.

and about movies....
Hollywood does not want people to have movies on their harddrives. This would lead to sharing those movies over P2P. The only acceptable means of recording a movie now is on a harddrive that cannot be removed from the machine it's in. A machine that I would not own.

This is the peak of insanity.....

I wish these people would make up their minds. I am so tired of being told by one company that I can have all this, then being told by another company that if I use it, I will be arrested and my computer confiscated.

Just what about the law?
The RIAA sues little girls over what they say is her lack of respect for the law. They even go so far as to convince the government to dispatch the DOJ against those who amass the music that Bill Gates wants us to play throughout our homes. If there is to be an ounce of integrity or a shred of decentcy or even the tiniest bit of intelectual honesty here, why is Hollywood and the RIAA NOT creating lawsuits against Microsoft for doing the same thing (THE EXACT SAME THING) as KaZaa, Morpheus, or any other P2P network? It ALL is an attempt to goat people into doing the very thing that the RIAA claims is so illegal.

The truth....
The truth is that downloading a song, a movie, or a program IS NOT STEALING. NOTHING is being stolen.

I have a hard time swallowing all this from Bill Gates when I can't really use what he offers and still be concidered "obeying the law".

This whole Itunes/Ipod thing that many would consider the legal way is in itself a way that works against the people...NOT for the people.

And TIVO....
Well, can we just overlook the problem that TIVO has already had with selling information about people that should never have been acquired in the first place. TIVO can kiss my @#! too.

The bottom line....
I would rather do things the old fashioned way: with VCR's and analog cassete tapes than deal with all this craziness that very easily could destroy my life. Microsoft will never get money from me for this kind of insanity and I'm just about to completely stop buying music(of anykind). It's just not worth it. I have had it. I HAVE SO HAD IT!!!!!

I rarely goto the theater to see a movie as it is. So few of their movies are worth seeing anyway.

I have better things to do with my time and money............
Posted by Prndll (382 comments )
Reply Link Flag
I feel ya, but ...
I feel your frustration, unfortunately it translated into a rant that
was not well put. You are right about the fantasy line Bill Gates
was promoting.

However, as a starving musician (turned to programming to eat),
i completely support iTunes. What on earth do you think is
wrong with it? TiVo, i can't speak to because I don't have it, but
if its about them selling viewing habits and info, TV stations
have done that since they had the capability.

Bottom-line, you are right about this free-for-all universe Bill
thinks he can get away with, unless they incorporate encryption
that requires all proceeds to go to microsoft first (then paid out
as royalties) ... that is probably what he is truly envisioning ...
control. But who the heck wants all the BS and security issues
that come with Microsoft to proliferate their home and daily lives
even more?
Posted by Thomas, David (1947 comments )
Link Flag
Not In My House....
M$ gets into my computers only when absolutely necessary. I'm
not about to open up my living room to M$'s versions of
entertainment control - especially when M$ is so far behind the
power curve in that area.

The home entertainment area is one that requires major
competition and many alternative concepts - not a singular
corporate focus with virtually no consumer input.

Sorry, M$.
Posted by Earl Benser (4310 comments )
Reply Link Flag
EyeTV beat's Bill to the punch
For anyone interested in this functionality without having to worry about viruses, check out Elgato Systems website for their various EyeTV products.

Yes they're built for a Mac, and they work in all corners of the world, with Analog or Digital TV. Bill eat your heart out!

EyeTV500 is the North American version that records Hi-Def and records with Dolby 5.1 to boot. Plus it's intergrated with TitanTV for free program listing.
Posted by (21 comments )
Reply Link Flag
 

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