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Consumer giants encircle the home PC

It's not going away, but it's not going anywhere either

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CES If you're wondering why Microsoft has chosen to place its strategic bets on the set-top box, rather than the traditional PC-based Windows Media center, a trip around the CES show floor explains why.

The Media Center isn't a bad idea, as we wrote here earlier this week, if you don't have a PC and live in one room. But Microsoft is nothing if not a volume company, and even if every studio-dweller signed up to Media Center, that wouldn't reach the volumes that Redmond historically feels comfortable with.

Add in the demographics, and cracking the home market looks even more daunting. Households that have already made an investment in a PC aren't likely to place another, premium model center stage. There's also a significant number of TV-dominated households which refuse to buy a PC at all.

The consumer electronics giants have been making crablike progress to offering the "convergence" part of the equation and connectivity without ever declaring open war on Redmond. Finally, they might start to be getting some traction.

Toshiba's vision of a digital media server is pretty typical. Its ADMS (Advanced Digital Media Server) which was demonstrated in "concept", ie vapor form at CES. ADMS is a TV, features time-shifting recording and streams over FireWire or 802.11. The connectivity is no longer a mystery, although the attention that the CE giants continue to give to esoteric technologies such as Powerline suggests that they're trying very hard to give the impression that they don't have a clue. They do. Toshiba's ADMS also boasts - as the presenter reminded us every forty five seconds - the 15 GB capacity HDDV discs, rather than plain old DVDs.

It isn't just the giants. Redwood City, Ca. start-up Digital Deck demonstrated a media server that's based around the concept that playback devices live in different rooms, and the problem is getting hold of the stuff. Digital Deck uses an Intel Celeron chip but the similarity with desktop PCs ends there.

With price points at around $500, versus $1500 plus for WMC-heavy alternatives, you can see why Microsoft's decision to scale down was very pragmatic. It really didn't have a choice, given its commitment to 'volume'.

Although it's starting from a disadvantage, Microsoft isn't necessarily handicapped on all fronts. TV streaming and time shifting naturally favors the traditional consumer manufacturers, who wrote the technology and petitioned to put own share denial mechanisms into the boxes. It's arguable that music favors the CE giants, too: no matter how many press releases from Apple or Napster trumpeting download figures, the music industry shifts billions of songs on CD, while very few are downloaded onto PCs. However, photographs and home movies are more likely to have been edited on a PC, where they remain.

Erecting barriers with ever-moving protocols has always been an option for Microsoft. But it will be a very strange, and fairly dismal, version of 'convergence' if it does adopt some of its anti-competitive tactics in the home, and ensures that the consumer electronics and PC industries remain worlds apart, bonded only by a shared love of DRM. ®

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