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Microsoft Targets PCTV

Platform agnosticism lives on


Microsoft is continuing its prolonged march into living rooms with a beefed-up version of its video-management software. The latest version of Media Center controls and manages video, audio and image access throughout the home. The new Windows XP Media Center Edition 2004, unveiled Sept. 30, adds features to download and play TV shows as well as movies and music, edit and print photos and handle a variety of other entertainment tasks via a remote control linked to a dedicated PC.

In other words, the Media Center delivers digital video recording capability at about five to 10 times the price of a standalone TiVo unit. Of course, the new Microsoft package also includes deals with CinemaNow and MovieLink for feature films, Musicbrigade (for music videos), WildTangent for videogames plus other providers, such as the revitalized Napster for paid music downloads (starting in December). All of this will enable customers to buy, store and sort content from a growing array of broadcast/cable and Internet sources -- and presumably feed them from the Media Center to the appropriate video monitor, audio system or other home electronics device.

For example, Media Center's new "MyTV" capacity extends standard DVR functionality, allowing viewers to burn a telecast onto a DVD for replay "on your laptop during your next business trip," as Microsoft promises. Microsoft insists that such activities comply with digital rights management restrictions, including recognition of shows protected by the "broadcast flag" set by content producers and broadcasters. When Windows XP Media Center Edition software detects this flag (called CGMS-A), the software will limit customers' ability to copy and distribute the program, a Microsoft spokeswoman insists.


Even top Microsoft executives concede that there's a skewed market for the latest version of its Media Center software and the actual hardware implementations from Dell, Gateway and other computer makers salivating to enter the consumer electronics world.

Rich Thompson, a Microsoft corporate vice president, admits that he "doesn't expect people are going to put this in their living rooms yet."

An independent study indicates that only about 25 percent of people who bought earlier Media Center-equipped PCs hooked them up to TV sets, even though a TV tuner is part of the software package. The desktop equipment, which is being optimized for consumer entertainment, remains a device that can also be used for conventional productivity and computer game uses. In addition to Dell and Gateway, PC makers including Sony, Toshiba, Hewlett-Packard and Viewsonic are preparing to build Media Center PCs, with more companies expected to join the lineup.

IDC, a Framingham, Mass.-based technology market research firm, estimates that devices using earlier versions of Microsoft's Media Center software have been sold in quantities "reaching into the low hundreds of thousands."

Roger Kay, IDC vice president of client computing, acknowledges that Microsoft's expectation to cross the "million unit mark" by Christmas 2004 "sounds reasonable to me."

Curiously, the Media Center update emerged within a fortnight of, Microsoft's latest version of its software package aimed at the "IPTV" (Internet Protocol television) market. After a number of futile efforts to entice U.S. cable TV companies to embrace its STB middleware, Microsoft is turning to telephone companies seeking to plant a stake in the video (including video-on-demand) world. Among Microsoft's first customers for the IPTV software is BellCanada, the Ontario/Quebec telephone company with visions of video competition. (See IPTV, p.18)


Electronic Program Guides (EPGs) are among the most appealing components of these digital television platforms, reflecting the need to navigate the voluminous content the systems deliver. Surprisingly, the Media Center and IPTV versions are significantly different, reflecting in part the diverse business units from which they emerged at Microsoft. The Media Center EPG emphasizes the ability to move between video program listings (including rosters of content stored in the device) and photo, music and games archives. Unlike a traditional PC desktop screen, the Media Center user interface has a more "TV-like" appearance.

On the other hand, the IPTV interface takes advantage of the customizable "live TV" nature of its program sources. It features thumbnail images of what is now playing on each available channel (motion video without audio), allowing viewers to browse up and down a program lineup, which also includes brief descriptions (title, performers, plot summary) of current shows. Viewers can click directly to the shows they want to see; Microsoft says that a new buffering system eliminates the typical one- to three-second lag that previously accompanied channel changing in digital systems.

Although Microsoft declines to indicate how soon -- if ever -- the Media Center and IPTV initiatives may be blended, the company is clearly seeking to integrate media products with its Windows Media 9 (WM9) initiative, the technology being proposed as a broadcast standard. Hence, the Microsoft Media Center vision fits the company's strategy of seeding the end-user market with low-cost products that require producers or distributors upstream to license or buy costly software to feed that vast customer base.

For now, the music-access features of Media Center software fit most closely with WM9.

Among the features supported by XP Media Center is improved picture quality and a new video calibration "wizard" for customized viewing. The software can feed to a high-definition monitor in 1080i or 1080p format as well as 720p and 480p formats. It also supports widescreen (16:9) displays. Its data filtering system (which now uses the Tribune Media Services' program listing data) lets viewers search for specific shows through keywords such as an actor or director's name.

Such visionary promises raise questions about Microsoft's ability to migrate into consumer electronics and broadcast/cable delivery. Critics have questioned whether the PC-derived Media Center software can become a multimedia command center in the competitive environment of set-top equipment.