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Microsoft Launches Media Center Edition 2005

With all the usual hoopla expected of a major Microsoft launch, the company rolled out the third version of its Windows Media Center operating system, called Media Center Edition 2005 (MCE 2005), here, earlier this month.

MCE 2005 has bulked up the A/V capabilities compared with its predecessors by enabling the use of devices called Media Center Extenders that can spread A/V content throughout a home, a new version of Windows Media, the ability to control two TV tuners in a PC, plus music and movie download services.

The new version also has partial HDTV capability; it can play ATSC broadcasts, but cannot work with cable or satellite HD signals.

Microsoft will support the launch with a $100 million marketing campaign, and the supporting vendors will back this program up with their own, hoping to expand the small niche that Media Center equipped PCs have created. All the major PC vendors plus a horde of peripheral makers have jumped on board with MCE 2005 products.

Media Center-equipped PCs have garnered a small share, about 3 percent historically, of the desktop and notebook markets since being introduced two years ago. However Stephen Baker, NPD’s director of industry analysis, said computers sporting MCE 2005 could push this growth upward, at least incrementally.

“The infrastructure is now in place with more homes having broadband, home networking and people now understand much of the underlying technology like DVR,” he said.

Michael George, Dell’s VP/general manager, U.S. consumer, was more upbeat.

“For us [Dell], I expect a substantial increase in Media Center PC sales, bringing them well north of the high single digits.”

However, retailers and manufacturers still face several challenges. Baker said the products are expensive, not well merchandised and require a high level of sales associate support.

Tom Markworth, Hewlett-Packard’s product marketing manager, said the company is working with retailers to position its Digital Entertainment Center PCs, which use MCE 2005, in the CE, not the PC, section.

The 2005 Edition has the same DVR, DVD burning and TV program watching functionality of the previous two versions.

The Media Center Extenders, which are being introduced by several companies, including HP, are small set-top devices that connect to a home’s various A/V products and are networked, either through Ethernet or 802.11g, to a home’s Media Center PC. The audio, video and digital content gathered and stored on the PC can then be distributed.

D-Link, Roku and OmniFi unveiled digital audio receivers. These allow the playback of a user’s digital music library anywhere in a home, regardless of the codec.

The upgrades included in Windows Media 10 include better library search and downloading capabilities and a built-in “Digital Media Mall.” WM 10 is designed for easy setup and auto synchronization with a slew of new handheld music devices that are expected on the market for the holidays. A version of WM 10 for PDAs and smartphones also has been developed.