CES 2005: Gates Promotes Digital Entertainment Anywhere Successes and New Initiatives

During his 2005 International Consumer Electronics Show (CES) keynote address last night, Microsoft Chairman and Chief Software Architect Bill Gates outlined the digital entertainment successes his company has logged since its Digital Entertainment Anywhere launch event on October 12. He also highlighted some interesting initiatives that will drive momentum throughout 2005, including several partnerships, some of which are quite surprising.
  
Gates noted that Microsoft has grown Media Center PC sales almost 50 percent since launching Windows XP Media Center Edition (XP MCE) 2005 in October. At that time, Microsoft reported that its hardware partners had sold a modest 1 million units in 2 years. However, in the 3 months since the Digital Entertainment Anywhere launch event, PC makers have sold almost 500,000 new Media Center PCs. If that sales pace continues, Media Center PCs will move out of their niche status and become a more viable platform for partners.
  
Windows Media Player (WMP) 10--which forms the basis for all digital media content in XP MCE and Media Center PCs--is off to a blockbuster start as well. Since its September release, more than 90 million people have downloaded WMP 10, which features access to a range of online stores that sell music, video, and other digital content. 
  
To enable its digital media plans, Microsoft will announce several interesting partnerships and initiatives that all tie back to the Digital Entertainment Anywhere theme. LG Electronics is partnering with Microsoft on a new DVD Recorder set top box that provides the familiar Media Center experience and can be used to record TV shows. The device will also be able to act like a Media Center Extender and access digital media content, including recorded TV shows, that's stored on Media Center PCs and XP-based PCs on your home network. Pricing wasn't available at press time, but Microsoft says that the device will go on sale late this year, in time for the 2005 holiday season. Pricing, I'm told, will be "aggressive."
  
Also on deck is a sweeping new partnership with MTV Networks, which owns cable stations such as Comedy Central, MTV, and VH1. Under terms of the agreement, MTV will broadly adopt Microsoft's Windows Media Digital Rights Management (DRM), Windows Media Audio (WMA), and Windows Media Video (WMV) technologies in a variety of products and services, including an online music store. In addition, Microsoft will work with MTV to deliver digital access to MTV's original content in several ways. "It will run the gamut," a Microsoft representative told me. Subscribers of MTV's eventual services will be able to access MTV content on any PlaysForSure-compatible device, including Windows-based PCs and notebook computers, Pocket PCs, Windows Powered Smartphones, and Windows Mobile-based Portable Media Centers.
  
In the unexpected announcement, Gates revealed that Microsoft is working with TiVo on its TiVoToGo service, which will let Windows users access TiVo-recorded TV shows on Windows-based PCs and notebook computers. "We want to make sure that Windows XP and Media Center users can easily access TiVo content and then copy it to Windows Mobile devices [including Pocket PCs, Smartphones, and Portable Media Centers]," a Microsoft representative told me. Here's how it works: The TiVoToGo desktop software will act as an intermediary between the TiVo device and your Windows PC. After you log on to verify your TiVo membership, you can freely move the content from WMP 10 to portable devices or other PCs. When I expressed surprise that Microsoft was partnering with a company that's essentially a competitor, the Microsoft representative said that the company is "building bridges with companies like TiVo. We're serious about Digital Entertainment Anywhere. Your digital media content should work no matter where you get it."
  
MSN previewed a new service called MSN Video Download. Although details are scarce--I wasn't able to find out Microsoft's pricing plans--the service will let you access video content, including news and sports, from Microsoft's many partners. Then you'll be able to watch that content on a PC, Media Center PC, or Media Center Extender, or copy it to a portable device such as a Windows Powered Pocket PC or Smartphone, a Portable Media Center, or PlaysForSure-compatible device. Speaking of partners, Microsoft will also announce many new services partners for XP MCE 2005's Onlight Spotlight, including Discovery Channel, Fox Sports, TitanTV, XM Satellite Radio, and Yahoo!.
  
Expect to hear other Media Center-related announcements. Companies such as Logitech, Philips, and Niveus will release new high-end universal remote control devices that are designed for Media Center PCs. Some even offer 2-way capabilities. For example, one of the Philips devices includes an LCD display that you can use to select a song or playlist; the LCD receives metadata information from the Media Center PC. Another Philips device is Universal Plug and Play (UPnP)-compatible and can be used to wirelessly stream audio content from a Media Center PC to headphones or a stereo system elsewhere in your house. In addition, the Imaging Science Foundation (ISF) is now certifying high-end Media Center PCs that meet or exceed its exacting standards for audio and video excellence. Alienware, HP, Ricavision, and Stack9 Systems will announce new ISF-compliant Media Center PCs at the show. And ATI and NVIDIA will announce that their video cards have passed ISF certification. The companies will bundle the cards with new Media Center PCs and sell them to customers independently.
  
Microsoft partner Toshiba showed off a new Tablet PC that targets consumer, home, and student customers. The Satellite R15-S822 Series Tablet PC will ship later this year. Microsoft is also releasing new Tablet PC Power Toys for consumers, including a tool for copying digital entertainment to Tablet PCs.
  
Finally, a lot of new PlaysForSure-compatible hardware is coming down the pike. Companies such as Gateway, iRiver, and Samsung will introduce new media players at the show, as will Archos, which will debut its first-ever PlaysForSure-compatible unit. And two companies--Digitrex and Pioneer--will show off lines of PlaysForSure-compatible LCD and plasma TVs. That's right: Without any additional software, these TVs will be able to search your home network for digital audio, photo, and video content and play it back from largest screen in your home.
  
These announcements all add up to a dramatic improvement in Microsoft's already impressive digital media ecosystem. Although the software giant hasn't yet received the credit it deserves for building such an amazing array of compatible devices, products, and services, I suspect that Microsoft's presence at CES 2005 will open more than a few eyes. Stayed tuned for more information as it comes in.

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