Original URL: http://www.theregister.co.uk/2004/01/08/ms_nearly_ditches_the_pc/

MS (nearly) ditches the PC religion with home net plans

Maybe it's not the PC, stupid...

By John Lettice

Posted in Software, 8th January 2004 16:52 GMT

Did Microsoft finally concede the death of the PC yesterday? Not quite, but the string of home electronics announcements, although pitched as the next logical steps onward from its existing product lines, put the company's vision of the PC as the center of home entertainment in some considerable peril, and kill off any last dreams of a PC on every desk - if, that is, anybody still remembers that corporate goal.

But it's good news to the extent that Microsoft is joining the real world, stepping over a pile of its own bodies as it does so. The notion that people would be willing to shell out for a wireless TFT display panel that would let them carry their PC display around the home (which we said was completely barking almost two years ago) died just before Christmas, while that of the PC as the centre of all things entertaining (which we dismissively, but rightly, interpreted as a jumped-up remote control exactly two years ago) may not itself have long to live.

Media Center was and is a niche product, if that. People who live largely in one room might find it handy to have all their stuff in one pile if the pile comes cheap enough, but it has little relevance to people wandering around several places doing many different things. Smart displays were an attempt to add that relevance, but they failed to do so, and now Microsoft is coming round to the view that quite a few people, particularly those without a desperate need to perpetuate the PC religion, knew all along anyway. The general-purpose PC isn't that important, and the future belongs to smart, connected appliances.

Microsoft's key strategic announcements from CES are of Windows Media Center Extender and Windows Media Connect. Extender is a sort of second, possibly more sensible, take on smart displays, while Connect is about connecting consumer electronics devices. You might reckon that these two things are sufficiently close for it to be possible, and less confusing, for Microsoft to just call them one thing, but apparently not. According to the release headings, "Microsoft Windows Media Center Extender Technology Delivers Digital Entertainment and the Media Center Experience to Any Screen in the House", while "Windows Media Connect Technology [enables] Seamless Media Transfer Between Windows XP-Based PCs And Consumer Electronics Devices."

So the plan is as follows. You have a PC in the home, which is already the case for most people in the target market, and Extender allows you to view the display from a range of other devices. Rather than have to shell out $500 and upwards for each and every one of those devices you might want (which was the smart display approach), the technology is built into TVs for an add-on cost of around $30, compatible set-top boxes can be produced for around $120, and so on. You'll be able to buy an adapter that allows an Xbox to work as an Extender device, but apparently not one that turns it into a Media Center in its own right. Hell, we didn't say Microsoft had entirely abandoned the PC religion, did we? Games consoles as the home entertainment centre is the Sony script.

Connect enables "hardware manufacturers to easily develop devices such as Digital Media Receivers (DMRs)... solves a looming home networking problem for consumers.. [and] helps harmonize CE devices and PCs." So your Connect device is a CE appliance that networks to your PC and lets you use digital content from the PC, while Extender allows an appliance to use digital content from the PC. Right.

Clearly, there is still a PC in the home, but in the new Microsoft view of things it's beginning to look considerably more like a home server, while a growing plethora of non-PC smart devices network with it. In Microsoft's view of things the central PC will still have to be a beefy, expensive and desirable consumer device, but you can surely see the foothills of the slippery slopes here - this is by no means essential.

Yes, you need all your digital stuff stored somewhere, and yes you need access to compute power from your smart device clients, but there's no inexorable logic to that somewhere being someplace you ever go. Nor need it look sexy, have pretty graphics, or even display, mouse or keyboard. Box in the basement, box at the service provider, Unix/Linux, dare we say? Microsoft has had obvious philosophical problems in dealing with the implications of smart consumer electronics and the networked home, and unless it plays this latest bid very carefully, and is very successful with it, very quickly, it's going to find itself tacitly agreeing with Scott McNealy and Sun, while continuing to maintain the contrary.

McNealy reckons seamless computing results in computers fading into the background and remote processing and the network running your life for you automagically, and he would say that because he gets his money from that remote power rather than from client PCs. Privately, Microsoft execs probably think pretty much the same - but the difference is that Microsoft has a need to secure control of the consumer electronics standards of the future before the PC standard becomes ghettoized.

In order to do this it has a goodly number of the usual suspects on board. HP and Gateway, for example, will be building compliant TVs with wireless networking, while set-top boxes will come from Dell, Samsung and HP. In addition, portable media devices will come from a range of manufacturers. Microsoft describes its new technologies as conforming to standards in the shape of Universal Plug and Play and "guidelines under development by the Digital Home Working Group." This group was set up in the middle of last year, and is effectively a challenger to the OSGi Alliance, a broader-based and longer-standing appliance networking standards body. But Microsoft is not a member of the OSGi.

In addition to manufacturer momentum, Microsoft has DRM in its favour - with the manufacturers, if not the consumers. The world has indeed turned upside down when a VP of the once mighty Napster says: "We are supportive of Microsoft's initiative to enable legitimate music services to work with home networks and allow consumers to enjoy their music in any room of their house," but that is indeed what Laura Goldberg says. Get the appliance manufacturers, the media companies and the services on board, goes the Windows Media strategy, and Microsoft will win the war, and the rest of the industry and the consumers will have no choice but to follow.

As always there will be opposition - Sony still spells trouble, the consumer electronics giants are not necessarily going to roll over for some upstarts from the PC business, and even Apple is looking dangerous. This time, however, it may be serious for Microsoft. The failure of past excursions into the consumer electronics business hasn't been fatal, because Microsoft has always had the PC franchise to fall back on. This time (or if not this, surely the next) the core franchise has limited scope for further growth, and could start to look relatively unimportant as a far broader market expands. And if Microsoft drops the ball again, it could itself start to look relatively unimportant. Other nostalgia buffs should also remember when this was last the case, and join us in pining for times when it was IBM that was the industry standard whipping-boy. Happy days friends, happy days... ®