CES: Gates expands Microsoft's digital home plan

Says Xbox 360 will serve as set-top box for IPTV

LAS VEGAS -- Microsoft Corp. Chairman Bill Gates kicked off the International Consumer Electronics Show yesterday by unveiling products that his company hopes will encourage more widespread adoption of the digital or "connected" home.

2007 International CES

2007 International CES: Jan. 8-11, Las Vegas

Microsoft has for some time been promoting the idea of a connected home, in which multiple devices can access and share multimedia content stored on a PC or a central server hub, but so far only the most savvy or wealthy technology enthusiasts have realized even a piece of that vision. But Gates and Robbie Bach, the president of Microsoft's Entertainment and Devices Division, aim to show how Microsoft can help more people get access to the technology.

Gates said service providers, such as AT&T Inc., that offer IPTV (Internet Protocol television) using Microsoft's software will begin offering this year the Xbox 360 console in lieu of a set-top box. Service providers still will give users the option of the set-top box for IPTV or an Xbox 360, said Microsoft spokesman Eric Hollreiser.

Still, the announcement sets up a scenario where a home user can watch television and surf the Internet through an Xbox 360 console, which also is an IP-connected device. The move shows Microsoft upping the ante to provide not just software, but also hardware for the digital home, which could eventually put it in competition with its own hardware partners.

As expected, Windows Vista, which will have its widespread consumer release on Jan. 30, was another major focus of Gates' speech. He unveiled new deals that will deliver more media content through Vista's Media Center capabilities. Windows Media Center, which used to be its own operating system but is now part of Vista, allows users to serve up content stored on their PC on televisions or to use their PCs or another device to set content for their TVs.

Deals with National Assocation for Stock Car Racing Inc., Fox Sports, Nickelodeon Networks, Showtime Networks Inc. and Bongo will deliver specialized content through Windows Media Center. All of the content except Bongo's will be free; users will have to pay a subscription for Bongo content.

Microsoft also will allow users to submit video content they have created to Media center by integrating it with Soapbox, Microsoft's YouTube-like, user-generated video-upload service.

The debut of Windows Home Server, a product Microsoft has mentioned before under the code-name "Quattro," is also aimed at helping consumers establish a more connected home. Windows Home Server will not be sold directly to consumers, but will be used by reseller such as Hewlett-Packard Co. as the basis for new hardware that consumers can put in their homes to connect their Windows Vista computers, Hollreiser said.

Users with a broadband connection and more than one computer or device that has an Internet connection can access data stored on Windows Home Server. It also will provide data security and automatically back up data every night.

Windows Home Server is aimed at providing a centralized server hub for multimedia files in the digital home, Hollreiser said. It will come in both Windows Vista and Windows XP versions, and pricing and specifications will vary according to the manufacturer. The first hardware using Windows Home Server software should be available sometime this year.

Gates also showed new hardware from Microsoft partners that use new Vista features. HP's TouchSmart PC, for instance, will take advantage of touch-screen capabilities in Vista, while the Toshiba Portege R400 laptop will include a display screen on the top of the laptop that uses Vista's Sideshow technology to display content such as users' Outlook schedules without requring them to open or turn on their PCs. Gates also showed a new ultramobile PC from Medion AG, as well as a new Vaio from Sony Corp. optimized for Media Center.

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