That’s Microsoft Entertainment

Microsoft announced the formation of its
Media/Entertainment & Technology Convergence Group, a move it says
addresses the trepidation that industry executives have regarding
the software company’s history.

The company tapped Blair Westlake, former Universal
Television Networks Group chairman, to head up the group as its corporate vice president.

“Microsoft, for a long time, has tried to position itself as a friend to the
entertainment community, a tool developer that helps to make the transition
to the digital world easier,” said Steve Vonder Haar, founder and research
director of Interactive Media Strategies. “There remain skeptics in the
entertainment industry on whether Microsoft can be a fair broker on digital
standards and devices.”

Now is as good a time as any to make a big push into the industry with
support for video and audio in a Digital Home,
particularly one based on Microsoft’s version.

The Digital Home concept is one where every electronic device in the house
— from the TV to the PC to the refrigerator — is connected to the
Internet. That’s a tall order, especially given the dizzying array of
standards used by each manufacturer and content owner.

According to Microsoft officials, 82 million households had a broadband Internet connection
in 2003, and the company expects that number to rise to 200
million by 2006. That, along with its estimates of $63 billion in worldwide
sales of DVDs, makes for an industry ready to take standards talks

To help craft their message, Microsoft officials announced they
were expanding their relationship with Warren Lieberfarb of Lieberfarb &
Associates. He’s credited as the “Father of the DVD,” according to a
Newsweek magazine account, not for his role in inventing the technology but for his
almost single-handed efforts in getting studio heads to sign off on the
technology while chief at Warner Home Video.

Microsoft executives probably think the company’s clout in the software
industry, with its Windows OS running on more than
90 percent of the world’s PCs (as well as efforts through Microsoft TV and
Windows Media Center), make it a logical choice as standards and convergence
shepherds. But they’re walking softly and finding allies to help
disseminate their message.

Vonder Haar said many in the industry still remember Microsoft’s past
actions in the PC industry of developing a presence in a device niche and
becoming a toll-keeper for the software technology used. It’s a criticism
he said Microsoft acknowledges and is working hard to correct.

The hiring of a former TV executive is a good start, Vonder Haar said: “If
you want to talk to the industry, having one of the industry’s own on your
side can’t hurt those efforts.”

There are signs consumers are waiting for the entertainment and electronics
industries to get their act together before venturing into an
Internet-enabled home. According to market research firm Ipsos, 72 percent
of U.S. consumers are interested in products that easily connect their home
entertainment systems to the Internet. However, those same people are
worried about the difficulties and knowledge required to get them connected.

“At this early stage of the game, with so many brands and product
variations, there is a risk that ‘translation clutter’ is confusing
potential customers as to what the products actually do,” said Todd Board,
Ipsos senior vice president, in his report.

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