Microsoft Monitor Weblog A Jupiter Research Business Weblog
 
Jupiter's Microsoft Monitor Research Service helps vendors prepare for market opportunities created by new Microsoft initiatives. In addition, Microsoft Monitor helps business and enterprise users discover which strategies are most successful in dealing with Microsoft and how to best exploit the customer relationship. The Microsoft Monitor Weblog is a companion to Jupiter's Microsoft Monitor Research Service and provides additional news, analysis and insight relevant to the areas most important for Microsoft's growth in both the business and consumer marketplaces. The content on this Weblog is often based on late-breaking events whose sources are deemed to be reliable. The insight and recommendations represent Jupiter's initial analysis. As a result, our positions are subject to refinements or major changes as Jupiter analysts gather more information and perform further analysis. Feedback is welcome at mm@jupitermedia.com.

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September 30, 2003
Media Center's Online Spotlight

Today, Microsoft unveiled Windows XP Media Center Edition 2004, the first upgrade to the entertainment OS launched about a year ago. While Microsoft clearly has momentum for the new version--for example, Dell and Sony will make Media Center PCs--and has made many consumer-user improvements, I am most intrigued by delivery of online content through the new OS.

The feature, one of several new Media Center functions, is "Online Spotlight," through which consumers will be able download content from CinemaNow, MovieLink and Napster, among others. So, a consumer watching "Friends" or "Sopranos" from a Media Center PC attached to a TV, would be able to download a video-on-demand movie from, say, MovieLink. The download would come over the Internet, without the consumer exiting his or her TV experience. The approach offers many intriguing possibilities, particularly if consumers could later buy movies they've downloaded.

In one hypothetical scenario, John Smith rents the movie "Dreamcatcher," which today came out on DVD. After watching the movie, he decides he would like to buy it. CinemaNow or MovieLink issues a new "digital rights" certificate that allows unlimited playback and even burning the film to DVD for home use. Already, MovieLink lets consumers "re-rent" movies they already downloaded. So, an actual purchase would simply be an extension of something already available.

Of course, cable operators might not look too favorably upon Media Center becoming a competitor in the living room for video-on-demand services. This is an area Microsoft would want to exercise caution, particularly as the company is trying to woo cable operators to Microsoft TV Foundation. On the other hand, that third parties would embrace the "Online Spotlight" concept is a real validation of Microsoft's entertainment OS strategy.

By the way, today, Jupiter Research released a new report, "Consumer PCs and Digital Entertainment," penned by colleague Avi Greengart. The report concludes that Media Center will become the standard OS on mid-level PCs over the next 12-18 months.

Posted by Joe Wilcox at September 30, 2003 12:34 PM
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