Wall Street Journal: “Media Center” Puts Microsoft Ahead of Rivals

The Wall Street Journal is out with an article this morning that which is quite positive on the prospects for Media Center as well as personally positive on MCE Chief Joe Belfiore.

“A year ago, Microsoft relaxed Media Center specifications that included a requirement for a TV tuner, thereby allowing PC makers to roll out inexpensive versions and boost sales. Thanks to those changes, says Bruce Greenwood, a director at Hewlett-Packard Co.’s PC group, “the mix of PCs available and sold out there with Media Center increased dramatically in 2005.” Sales since the product’s birth have hit 6.5 million copies, most of which were sold in the past six months. “The momentum is definitely increasing,” says Joe Wilcox, an analyst at JupiterResearch.

A further boost will come next year when Microsoft integrates Media Center with the next version of Windows, called Vista. The change means most new consumer PCs sold from the latter part of next year will be equipped with Media Center software, getting it to millions more consumers. The change makes Media Center and Mr. Belfiore, who was recently elevated to vice president, more central to its consumer entertainment strategy. It is also good business: Microsoft charges PC makers more money for Windows with Media Center than standard Windows.

Microsoft Chairman Bill Gates demonstrated the Vista-Media Center combination last night at the Consumer Electronics Show in Las Vegas. He also announced a “mini” Media Center PC made by Averatec Inc. and Advanced Micro Devices Inc. and a partnership with DirecTV Inc. that for the first time lets consumers view DirecTV satellite programming on their PCs.

The Vista-Media Center plan could help bolster Microsoft’s defenses against a possible challenge from a competitor with big momentum — Apple Computer Inc. In October Apple announced Front Row, a program for its iMac G5 computers that, like Media Center, helps organize and find digital content with a remote control. Apple isn’t commenting on its plans but is widely expected to try to take Front Row to more of its machines, and possibly to TV sets as well.

The Apple threat seems menacing, in part because of recent history: Its iPod was a late entry in an established field of digital music players but soon stole the lion’s share of the market. At Microsoft, Front Row is already causing ripples: Mr. Gates in an email to Mr. Belfiore asked why Apple’s remote control had just six buttons. The standard Media Center remote from Microsoft has 39 buttons. (Mr. Belfiore’s explanation: Front Row computers don’t have TV or digital video recorder functions and thus don’t need as many buttons.)

At stake is more than just another piece of software for home computers. Both companies, and others, are trying to build the foundational technology for all home digital entertainment.”

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