Windows Media Center 2005 - The last missing piece

Michael Gartenberg | October 12, 2004, 01:13 PM

Microsoft finally unveils the missing part of the strategy it announced a few weeks ago with Windows Media 10 and Portable Center. Today they announced Windows Media Center 2005 and Windows Media 10 Mobile. MCE 2K5 is important. This OS will serve as the hub for Microsoft’s home strategy and is the cornerstone for a vision of allowing you have your content live in one central location but still have the flexibility to access that content in other rooms in your home on TV screens or stereos, take that content with you on your laptop, burn it to DVD or CD, use a portable media player to take audio and even video and pictures and with WM10 Mobile, take it on your PDA and Smartphone as well. No one else has this clear and articulate a message about the PC as a hub for the digital home for all content, including TV, Video and Pictures. The new OS supports multiple TV tuners and if you have the hardware will support HD over the air. In addition support for Portable Media Center and Media Center Extender are built in. Most important, this is the first version of MCE that crosses the threshold of being useful to the enthusiast market and is usable by mainstream users. OEMs can even set MCE to boot directly into the MCE UI and most users may never need to shell out to the desktop. I’ve been using Beta builds since mid summer of both MCE and Extender and both work very well. Stability and security and have not been an issue and content looks really good. The ability to burn content to DVD is now built in to the system and things like discovering what movies are playing have been greatly enhanced. Combined with some of the new living room form factors from PC OEMs, MCE will have a much greater chance at ending up in consumers homes. There’s a battle going on for the hearts and minds of consumers for DVR functionality. The installed market is only about 4% so it’s hardly game over for anyone and MCE looks to be a strong player in the market. What’s the downside? Well, there’s the complexity of the message. Microsoft is throwing an awful lot out there to a market that is not overly sophisticated. The vision is clear and message is articulate. The messaging needs to be simpler though and much more easily digested. Consumers need to SEE these things in action and the synergy they enable or the message will be lost. Other parts of the equation, such as Media Center Extender are heavily dependent on consumers home networks, which is beyond MSFT’s control. To work well, Extender needs a wired network next generation 80211.A equipment, which has both the speed and range to stream video properly.
As we point out in some new research that we released today, we forecast that standalone DVRs, such as TiVo and Replay TV, and PC-based DVRs will secure only 20% of the market while cable and satellite DVR providers will secure 80% of the market by 2009. Currently 61% of U.S. online households use cable and satellite DVR providers while only 39% use standalone DVRs like MCE. The challenge for Microsoft is to execute a marketing message that will allow them to take a larger share of that marketplace.