Interesting Nuggets From Microsoft’s Earnings Conference Call This Afternoon
Today after their earnings release, Microsoft’s Curt Anderson, General Manager, Investor Relations, and Scott Di Valerio, Microsoft’s Corporate Controller held an analysts conference call where they discussed Microsoft’s latest earnings, future guidance and took questions from equity analysts.
Much of the call was pretty dry and boring but these were the nuggets I picked out.
1. Microsoft’s venture with Verizon is expected to be available later this year. They also mentioned their relationship with Alcatel but didn’t provide any details.
2. Microsoft is optimistic on the Comcast relationship. Expect the trial of Microsoft TV Foundation currently being tested by Comcast in Washington State to continue to move forward. According to Microsoft all Comcast customers in Washington State should be migrated to TV Foundation by the end of the quarter.
One thing that I will be interested in down the road will be the number of TV Foundation users that switch to TiVo’s Comcast service once it arrives. My suspicion would be that as TV Foundation is most likely a much better UI for Comcast’s cable box than their regular old UI, that you get less people on TV Foundation migrating to Comcast TiVo.
I will also be interested in Comcast’s churn rates on the new TV Foundation boxes vs. Comcast’s non TV Foundation boxes, although again it’s probably too early to know any of this yet. If the churn rate were much lower though I’d expect to continue to see this relationship move forward beyond Washington State.
3. It looks like you will see less ads at MSN.com as they have already started moving more of the real estate to content and less to advertising for a cleaner less cluttered look.
4. Very little on Media Center beyond, “it has good traction,” and a reiteration of Bill Gate’s previous announcement that they passed the 2 million user mark. The analysts asking the questions were much more interested about the sever world and things driving hard revenues and earnings here and now today than they were on future product development.
5. Microsoft is expecting big things from their new version of the Xbox and expect that it will drive revenues and make up for lighter demand for Windows XP. Microsoft mentioned that the majority of it’s software units are sold through OEMs when people make the jump to upgrade their PC while upgrading their OS at the same time. My guess is that to a certain degree all this hype and attention about Longhorn could diminish consumer demand to upgrade to a new PC with a version of XP. I know that when Longhorn is out I will definitely upgrade my machines. I think they are expecting big things out of Xbox to pick up the slack. Hey guys, tell me it can stream HDTV as an extender unit and you can count me in for three of them!
6. As the Q&A; time on these analyst calls is somewhat limited, I thought it was particularly lame that Mary Meeker of MorganStanley used her only question to ask about Longhorn’s timeline and implementation when this is widely known everywhere. Of course Microsoft reiterated beta next year followed by pre-Holiday release. Duh, Mary.