Microsoft Corp President and Chief Operating Officer Rick Belluzzo said that while the market for networked home devices will be "competitive," the company will use its strength in personal computers as an advantage.
Microsoft Chairman Bill Gates said last night in a speech at an industry trade show that the company will produce software for running portable wireless devices that can send e-mail, listen to music and view Web pages, as well as a program for new PCs with video and television features.
The company will face competition in its bid to sell software for such home devices. Sunday, closely held Moxi Digital Inc unveiled software for interactive TV, video and music on TV set-top boxes. Microsoft rivals AOL Time Warner Inc and Sony Corp plan to cooperate to build home devices that can communicate with each other, the Web and entertainment sources.
Microsoft's PC dominance won't provide any advantage in the home entertainment and networked home markets, said Josh Bernoff, an analyst at Forrester Research. Consumers will be unlikely to want to use a PC for entertainment because it is too expensive and complicated, he said. "I'd classify [Microsoft's announcements] as audacious but eventually futile moves to try and put a PC at the center of your entertainment experience," he said. "Ownership of the dominant operating system for PCs doesn't confer any advantage whatsoever on the entertainment side."
Sixty percent of US homes have PCs, Belluzzo said, and more than 90 percent of PCs run on Microsoft's Windows program. He also cited the Redmond, Washington-based company's relationships with hardware partners and experience in building software and Internet services as advantages.
"To the extent we can extend the PC to be able to deliver more of this capability that is a strong advantage to Microsoft," Belluzzo said in an interview. "In a lot of the other scenarios, they're all new devices, new investments people have to make."
It's Microsoft's money -- US$36 billion in cash and a research budget of US$5.3 billion -- that will go a long way to helping the company compete, according to Rob Enderle, an analyst at Giga Information Group. Microsoft often takes several versions to get a product right, he said, but they have the money to stay in it for the long haul and buy up or force out some competitors.
"Their resources probably speak to the fact they can compete," he said. "Money and power do have an awful lot to do with whether you're successful. It's going to cost them a lot," he added.
Gates said last night the company is working on a product code-named Mira, a set of programs that will run portable wireless devices including a detachable tablet-sized PC monitor. These devices will connect wirelessly with a Windows PC to view Web pages, send and receive e-mail, play music, and edit and display digital images. Devices with the software will be available for this year's holiday season.
A second product, code-named Freestyle, is a set of programs to run a remote-controlled entertainment PC from companies such as Hewlett-Packard Co and Samsung Electronics Co. The computer will let customers enjoy music, videos and photos and let users watch, pause and record live TV.
Both products, which were announced yesterday at the Consumer Electronics Show trade conference in Las Vegas, are based on Microsoft's Windows operating system.
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