Beyond Binary

These days, getting a PC for $1,200 is no big deal. Even two PCs for that price is pretty run of the mill.

Starting on Thursday, though, Best Buy will offer for that price a "PC Home Makeover" that includes three PCs--a laptop, desktop and Netbook--as well as a monitor and router. Even in-home Geek Squad set-up is included.

It's one of those screaming deals, that Windows Vice President Tami Reller was referring to when she spoke with CNET News last week. The deal is set to be officially announced on Thursday, although details of the offer were noted on Best Buy's Web site.

The package includes an HP Slimline desktop (model s5212y), an 18;.5-inch monitor, HP mini Netbook as well as a "media-savvy" laptop (model G60-535DX) along with a Netgear 802.11-G router and in-home setup of each of the components.

Microsoft's price advantage vis-a-vis Apple is among the things the company is looking to highlight as it launches Windows 7 on Thursday.

Ahead of Windows 7 launch, Apple on Tuesday announced a fall lineup that includes refreshed Mac Mini, MacBook, and iMacs, but keeps Apple in largely its traditional price range.

PC makers meanwhile, are showing off Windows 7 models ranging from inexpensive Netbooks to high-end gaming models that can fetch several thousand dollars. The notebook category, in particular, is broadening with products that are both cheaper and less pricey than traditional notebooks and yet feature bigger screens than a Netbook.

Nearly every PC maker also has at least one touch-screen all-in-one, with many offering touch-screen laptops as well.

CNET News is live in New York and we'll have tons of stuff from here, including live coverage of the festivities Thursday with CEO Steve Ballmer. Plus, if you still have lingering questions, let me know and I'll try to get answers.

PASADENA, Calif.--Hewlett-Packard plans in coming months to introduce an electronic collaboration tool that combines video conferencing with electronic whiteboarding, CEO Mark Hurd said Friday.

Speaking at Fortune's Brainstorm: Tech conference here, Hurd said the tool goes beyond anything Microsoft has developed.

HP CEO Mark Hurd and Dreamworks Animation CEO Jeffrey Katzenberg speak at Fortune's Brainstorm: Tech conference here.

(Credit: Ina Fried/CNET)

"This is a great capability," he said. "This will not just (have the) ability for you and I to see each other. I can actually write on the screen. You will see it the way I wrote it."

He said the product would be "very, very competitively priced," but didn't give pricing or further details.

Hurd was asked about the economy, but said there wasn't much he can say given that HP's quarter is just about to end.

"Everything we see says '10, being 2010, we expect to be a better year than 2009," Hurd said. "There's no question that people have put off purchases. That ages the infrastructure, which at some point creates a replacement cycle. Sooner or later, things will rebound."

Business Productivity Online Suite

(Credit: Microsoft)

Microsoft on Monday said that Hewlett-Packard's EDS unit and other partners have agreed to help sell its collection of hosted online services.

EDS, Accenture, and others will help sell what Microsoft calls its Business Productivity Online Suite--a collection of products that Microsoft hosts in its data centers. The products include Exchange, SharePoint, Office Communications Server, and Live Meeting.

Microsoft launched the collection of services last November, but has been saying it also wants partners to help sell the services.

Dutch system integrator Wortell said it likes Microsoft's services because they offer both the opportunity for higher sales plus a way to reach customers that don't have a lot of money to invest in building their computing infrastructure. Microsoft's online services allow those businesses to offer features like full corporate e-mail at a lower upfront cost.

"For us, (it) means that we don't have to worry about infrastructure," Burlage said in an e-mail interview. "It allows us to focus on what's really important." Wortell CTO Danny Burlage said in an e-mail interview.

Microsoft said that it, in fact, won't be able to restart a Black Friday promotion with HP.com that many were unable to take advantage of because of glitches with the Live Search Cashback program.

In a blog posting on Friday, Microsoft said that, although it is working to give those who ordered products their promised 40 percent discount, those who were not able to place an order are, essentially, out of luck.

"There have been lots of questions on whether the 40 percent off HP promotion on Black Friday will be restarted," Microsoft said in the posting. "While we were hoping to be able to do that, we are sorry to report that it will not be restarted."

A Microsoft representative had indicated earlier this week that the promotion would be restarted, although a statement on Tuesday indicated that might not occur.

While this is bad for bargain hunters, it may end up being worse for Microsoft, which is trying to use the Live Search Cashback program as a way to build awareness and loyalty for its search product.

With Microsoft having, at the very least a "hiring chill," we decided to check in with other big tech giants on their hiring plans.

It's a little hard to get a clear picture of what other companies are doing--in part because so many have already announced plans to cut jobs. Intel's workforce is down thousands from where it was a couple years ago. Hewlett-Packard has already said it plans to shave 24,000 jobs as part of its EDS purchase, while Dell and others have also been cutting back.

Yahoo, already under pressure from competitor Google and the ugly saga of Microsoft's attempt to acquire the company, said Friday that it is bracing itself for a weaker advertising market.

"We believe it's imperative we align our cost structure with today's economic realities," said Yahoo spokesman Brad Williams. "We've been looking at ways to streamline our processes and bring more efficiencies to how we work as an organization," he said, and the company hired Bain & Co. to "help us identify opportunities for improvement."

He wouldn't confirm that layoffs are part of the plan, but payroll is a major expense, and most employees know how to read the tea leaves when they hear the word "streamline."

Though Yahoo is under pressure itself, Williams said the economy and the advertising market led to the current analysis. "The collapse of the credit markets...accelerated what had been a pretty uncertain market," he said.

For its part, Google said "We continue to hire talented people across functions for our offices worldwide." Of course, the real question is at what pace they continue that hiring.

In a meeting with reporters Wednesday, Chief Executive Eric Schmidt supplied a big dose of caution about whether there might be effects from the broader economic issues.

"It's a very dynamic situation. There is evidence credit is a problem for certain sectors. We have not yet seen any impact from it," Schmidt said. But, he added, "We might. All bets are off. Nobody knows."

Many expect TV and print advertising to be hit harder, but that doesn't mean online ads are immune. Even if individual ads or campaigns are profitable, the ad market can be hurt when customers tighten their purse strings and advertisers reduce spending.

Most other companies didn't have much new to say on a Friday afternoon, but it's fair to say that every company has got to be taking a second look at those 2009 numbers. Anyway, here's what several big names did have to say on the matter.

Dell: Dell spokesman David Frink said the company is certainly monitoring things, but had nothing new to announce. "But as you know, we've got a well publicized effort under way to reduce costs," Frink said. Dell has cut 8,500 workers from its ranks in the last four quarters. That said, Frink said Dell "will selectively hire in areas that are important."

HP: "Workforce rebalancing is a continual activity across our businesses and geographies to ensure that resources are aligned with the opportunities in the market," HP said in a statement. "We expect that our overhead costs, which include IT, real estate and shared support functions, will decline more from (fiscal 2007 to fiscal 2009) than they did from (fiscal 2005 to fiscal 2006)."

IBM: "We haven't announced any freeze," an IBM representative said. As of right now, nothing has changed at IBM. We continue to hire in key skills areas."

McAfee: "McAfee has not changed its hiring process and continues to make strategic investments in its personnel," A company representative told CNET News. "We continue to add to our headcount. McAfee has grown significantly over the past quarters."

Microsoft: "Microsoft will continue to grow and add thousands of new jobs this year, but given the current economic environment, we are taking the prudent step of reviewing our hiring plans and will make some adjustments as appropriate," spokesman Lou Gellos said in a statement. "We are optimistic about our prospects for growth and will continue hiring the talent we need to ensure our ongoing success."

Intel: Declined to comment, citing a pre-earnings announcement quiet period.

Apple: Declined to comment, also citing a pre-earnings quiet period.

Oracle: Declined to comment.

CNET News' Charles Cooper, Stephen Shankland, and Robert Vamosi contributed to this report.

Moments after Hewlett-Packard announced plans Monday to chop more than 24,000 jobs, Chief Executive Mark Hurd defended the company's purchase of EDS, saying it will help the company in the long term.

"The enterprise is big," Hurd said at a meeting with financial analysts. "It's attractive for us and it's heading our way."

As for the integration of EDS, Hurd noted that HP has a history of being able to digest large companies. HP announced plans in May to acquire the computer services firm for $13.9 billion. The deal closed in August.

"We bought 30 companies in the past four years," he said. "We're good at it."

Although the headlines were sure to focus on the job cuts, which will take place over the next three years, Hurd said the deal's benefits were not limited to cutting jobs. "I can assure you there are other synergies we are looking for in the acquisition," Hurd said.

Following Hurd, HP executive Ann Livermore talked up how the combined companies' services and products lineup. In HP's own house, Livermore noted that the company is doing internally what it hopes to do for customers.

In fiscal year 2005, Livermore noted that it had more people working in IT than it did in its sales force as well as too many applications.

"We had a real spaghetti bowl of things," she said. By the end of fiscal year 2009, Livermore said it will have twice as many customer-related staff as it will in IT as well as getting far more computing power, despite having reduced its total number of servers.

Hurd kicked off the meeting with a reference to the bloodbath on Wall Street that took place earlier Monday after Lehman Brothers filed for bankruptcy and Merrill Lynch announced a hastily put together plan to sell to Bank of America.

"That was a tough day on Wall street," Hurd said. "I hope there's a chance I can capture your attention."

Update: CFO Cathie Lesjak told analysts that the company expects to make about half of the job cuts to be made by the end of fiscal year 2009, spread out roughly evenly over the year.

Although it plans to eliminate more than 24,000 jobs overall, Lesjak said that the company expects to reinvest some of those savings, ultimately adding back about half the number of of jobs being lost in other areas.

"We need to get the EDS cost structure more competitive," she said.

A sure way to get some search traffic is to make sure that your engine is the default option inside the browser.

For antitrust reasons, Microsoft can't just make its engine the default in Internet Explorer (except in some very limited circumstances). If it wants to get Live Search on new PCs, it has to strike a deal with computer makers, just as rivals have done.

On Monday, Microsoft announced just such an agreement, with Hewlett-Packard agreeing to make Live Search the default on its consumer PCs starting in January. The computers will also carry a toolbar that uses Microsoft's Silverlight in conjunction with Live Search.

Top executives said recently that they felt the quality of Live Search had reached a point where it made sense to start using some marketing dollars to acquire traffic, so I wouldn't be surprised if this is the first deal of many, especially since Microsoft has yet to reach a deal with Yahoo and its share of the search market has continued to decline.

Microsoft didn't say how much it is paying HP for the right to be on its PCs, but it did call the deal its most significant one to date.

"This agreement with HP is a strategic indicator of our increased focus on securing broad-scale distribution for Live Search," Kevin Johnson, president of Microsoft's platforms and services division, said in a statement. "This is the most significant distribution deal for Live Search that Microsoft has ever done, and we are very pleased to be partnering with HP to help bring Live Search to millions of consumers across North America."

LAS VEGAS--Every year, I schedule too many meetings at the Consumer Electronics Show and don't get enough time to just roam the show floor in search of gadgets that are either ultra-cool, absurd, or preferably both.

This year, I made a commitment to wander the show floor and absorb as much as possible. It should be said, in three hours on the show floor, I covered a very small portion of the south hall of the Las Vegas Convention Center.

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So the seventh wonder of the tech world could have been in the north hall, central hall, or the far-flung Sands expo hall, but I couldn't tell you.

What did I learn? First of all, there was not one product that everyone was talking about. If there was a universal hit, it was the huge flat-screen displays that many companies were showing off. I spent a few minutes watching video on a 100-inch screen. It's by no means the biggest on display here at CES, but it was three times the diameter of anything in my house.

From there, I decided I needed a rest, stopping at what might be the best massage chair I've sat in--a $4,000 model from Anaheim, Calif.-based Omega Massage. I make it a point to always try these out, whether at trade shows or the airport Sharper Image. It's all part of my sacrifice for you, my loyal blog readers (or you, the random clicker on this post).

From there I made my way to the folks who needed the massage chair far more than I did--the HD DVD booth. There, association members and technology partners put on a brave face, despite the major blow delivered by Warner Bros. last week, announcing that they would exclusively support rival Blu-ray.

I'd heard about some wireless earbuds from Sennheiser, so I went by the booth to check them out. They were behind glass, but I could see enough to know they weren't for me. They look kind of like a pair of those Bluetooth earpieces I already find annoying, plus they require your iPod or other device to wear a somewhat bulky transmitter. I think there's probably a market for these. It's just probably not for the average iPod owner.

Continuing on the headphone theme, I went to the booth of Skullcandy, a company whose hipness factor is hurt only by the fact that I own a pair of its earbuds. There were DJs and hip-hop musicians performing and an artist doing a skull drawing as the company showed off a variety of products, including a set of iPhone earbuds and a DJ-style headset that also includes a built-in SD card slot for playing music without a separate MP3 player. Both products sell will sell for $89, with the wireless SD headphones due out around March. I also stopped by Shure, which was showing off an attachment that turns its line of in-ear headphones into an iPhone headset by adding an in-line microphone.

Having heard enough, I moved on to other areas of the hall. Among the places I stopped was a Dell environmental booth that consisted of some eco-furniture and two glass whiteboards where people could scribble their ideas on how to improve our ecological impact. The booth rep told me the ideas would be taken to an executive meeting back at Dell headquarters. Not sure what they will do with the posts, which included "Take public transit," "No more products, no more people," and "Killjoy."

My favorite moment was when a woman from Baton Rouge asked if she could get a brochure.

The booth rep tried to handle it politely. Well, no, see, the whole point is...

I decided to let Dell save the planet without me and continued on in search of more tech fare. I stopped by several random booths that caught my eye, including a company peddling a mini-photo studio perfect for snapping shots of your eBay trinkets without casting a shadow. I stopped by HP and Kodak to check out the latest in photo-printing kiosks. I'd been pretty impressed with the HP model I tried out at a drugstore this holiday season, and found Kodak's models even more versatile. Both make choosing prints easy, but I liked the quick photo books that it was capable of cranking out, as well as a new Photo DVD maker that lets you set your photos to one of about 20 songs, ranging from a Hootie and the Blowfish track to the theme from St. Elmo's Fire.

I found myself drawn to the Brother booth, where it was showing software, apparently not new, that turns your digital photos into something stitch-able with one of its embroidery machines. The software sells for around $1,000 and the machines range from a $600 model to one that sells for $13,000.

I was also drawn to a small booth in the corner, with a sign "We buy closeouts" and showing a smattering of non-tech and low-tech items such as whiteboards and fax machines. Carolina Wholesale owner Larry Huneycutt said the Charlotte-based company has been coming to CES for 20 years and finding customers and sources for his far-from-state-of-the-art gear.

His catalog includes label makers, digital projectors, and calculators. "We even sell typewriters," Huneycutt said.

But some of the latest gadgets were also low-tech, including the oft-maligned Quik Pod, a camera attachment that holds a camera at a distance allowing for better pictures of oneself. It's a gadget that I reckon plenty of people would like, but few would want to admit to needing, much less buying.

The latest model is an even tougher challenge. It's an SLR model for larger cameras. My colleague points out that this only increases its dorkiness factor.

I don't disagree, but also think that there is a market, even for pros who want to snap their own picture as well as the legions of wannabes. I just think that the pros (and wannabes, myself included) are less likely to want to admit it. That's why it's nice that the SLR model can also be used as a monopod.

Bill Gates announced Windows Home Server to much fanfare at January's Consumer Electronics Show.

The energy seems to have dwindled some during the product's elongated path to market over the past year. Microsoft finalized the code back in July, but HP said it would wait for an update to the software before releasing its MediaSmart server, in what was seen as the biggest endorsement of the product.

On Monday, Microsoft announced "general availability" for the software, although HP's product will not be shipping to consumers until later this month. Some servers from smaller computer makers have been available for a short while, though it's not totally clear what marks today as the day for general availability.

Medion and Fujistu Siemens still plan releases in Europe later this year, while Iomega's product is not aimed for arrival until next year.

Even when HP does start shipping its MediaSmart server in the next few weeks, the product is not expected to be a staple on store shelves. CompUSA is planning to sell it in some stores, while Circuit City and Best Buy are only committing to online availability for now, according to Microsoft. Other online retailers, such as Buy.com and Amazon.com, are also expected to sell HP's server, while Microsoft is holding out hope that retail availability will improve later in the year.

Amazon has started taking preorders for HP's server, which as of mid-morning Monday had climbed to the top of Amazon's best-seller list in the computer category.

The idea of a simple server to serve as a repository for media such as photos, music, and video holds some appeal, but it is something most consumers are going to have to learn more about and see and touch before being sold on the idea. That's going to be tough to accomplish with limited marketing and limited retail presence.