Microsoft Sounds Call for “Digital Media Revolution” at Streaming Media West ’99

SAN JOSE, Calif., Dec. 7, 1999 — Twenty years ago it was the personal computer. Four years ago it was the Internet. Today, it’s digital media.

“It” is the latest revolution in computing, according to Microsoft chairman and CEO Bill Gates, who says this next major wave of computing will bring entirely new benefits to consumers worldwide as digital audio and video become as mainstream as text and graphics are on the Web today. Gates shared his vision for digital media with consumers, business leaders and others in a keynote address at Streaming Media West ’99.

“Digital audio and video are radically changing computing and the Internet for consumers and businesses alike,” Gates said. “The digital media revolution opens tremendous opportunities for industry innovation in the ways consumers use this technology at home, at work and everywhere in between.”

Confirming Gates’ vision of a future in which consumers can easily hear, see, edit and distribute audio and video over the Internet, televisions and portable computers, Microsoft and its partners this week announced new technologies, partnerships and initiatives that move the digital media revolution into homes and workplaces worldwide. These announcements — focused on high-speed broadband media, music distribution and services, business applications and consumer electronics — mark accelerating growth for Windows Media, the leading digital media platform.

Just as personal computers and the Internet spawned new communications, entertainment and productivity tools , digital media is transforming the PC into an entertainment device, connecting the home stereo, television, handheld music devices — even the automobile –with high-quality audio and video.

Consumers and the streaming media industry alike are responding enthusiastically to Windows Media technologies and Microsoft’s work to help advance the digital media marketplace. An independent study by PC Data recently concluded that the Windows Media Player is the fastest-growing media player in the market, climbing 34 percent in market penetration over the past three months. Six out of 10 media player users are using Windows Media Player. Now 50 million strong, the number of Windows Media Player users is growing by one every second. More than 1,000 content providers worldwide offer Windows Media formatted content, and is among the fastest-growing audio and video guides on the Web.

Microsoft is intensely focused on working with others in the industry to bring digital media to mainstream consumers and business. Microsoft sees consumers benefiting from three major areas of digital media development supported by Windows Media: new broadband initiatives, new consumer electronics devices, and new music and entertainment industry alliances and projects.

Broadband Initiative Brings High-Quality Content to Consumers

The Microsoft Windows Media Broadband Jumpstart Initiative is one way Microsoft is helping to accelerate the availability and adoption of high-quality digital audio and video to consumers at lower cost. The initiative is the first complete solution for moving broadband into the mainstream by removing the technology and market obstacles that consumers and industry leaders face today.

The Jumpstart Initiative got a major boost at Streaming Media ’99 with the announcement of more than 45 new partners, more than doubling the number of initiative partners in two months. Just last month, the initiative partners helped make the “The Drew Carey Show” webcast a success, with more than 650,000 streams successfully delivered by Akamai, iBeam, INTERVU and Sandpiper.

Microsoft has also released its Windows Media Broadband Guide, the first comprehensive guide to Windows Media broadband content on the Web. The guide — serving the more than 3.3 million unique users of — makes it easy for consumers to find and use digital audio and video on the Internet by offering one-stop access to the best news, sports and entertainment available to broadband subscribers.

New Electronics Devices Put Windows Media into Consumers’ Hands

A broad range of new set-top boxes and portable devices are giving consumers the ability to use Windows Media Technologies when and where they wish. For example, the new General Instrument DCT-5000+ set-top box is the first digital set-top terminal to bring broadband Internet video and audio to cable television without sacrificing traditional analog and digital video. This new technology will allow consumers to simultaneously watch video, surf the Web and make a telephone call on the Internet.

To bring the benefits of Windows Media to home stereos, Microsoft is teaming with Sonicbox Inc. to introduce the Sonicbox imBand Remote Tuner, which uses Windows Media to deliver Internet streaming audio to home stereos. The device offers CD-quality digital audio from a variety of sources as well as customized playlists of music downloaded from the Internet. The tuner allows listeners to select from hundreds of stations with the turn of a knob and to purchase CDs with the push of a button.

Windows Media extends its reach to even smaller devices, as a significant amount of audio and video content is put to use in the new RCA LYRA portable digital audio player from Thomson Multimedia. This device, the first digital audio player that can be upgraded via software downloads, can store twice as much CD-quality music without adding extra memory, a common limitation with current digital audio players, so consumers can enjoy more music on a less expensive player. Another important partnership for Microsoft — and ultimately consumers — is with Texas Instruments, building Windows Media and digital rights management technology into its programmable digital signal processors (DSPs), which power leading portable music players and devices.

At Streaming Media ’99, Gates also previewed the new Microsoft Windows Movie Maker for consumers, which lets consumers turn home movies from any video camera or VCR into digital movies that can be stored, edited, and shared by the PC. Windows Movie Maker, a new feature of the next consumer release of the Microsoft Windows operating system, works with the low-cost video capture hardware that ships as standard equipment on many of today’s PCs. It includes 300:1 compression that makes it easy and convenient to store video on hard disks. Once consumers have video clips on their computers, they can organize the videos any way they want, editing out unwanted scenes, adding fades, transitions — even music or voiceovers. These videos are also easy for consumers to send and receive over the Internet. For example, a three-minute video can be compressed to just 100KB and easily downloaded in just a minute or so on a 56bkps modem. Consumers will be able to use Windows Movie Maker to share new-baby videos with grandma, or send video love-letters while separated from a spouse or loved one.

New Partnerships Give Consumers More Options

No single company will determine the future of digital media, Gates said. In fact, realizing the vision of this next major wave of computing will require innovative partnerships throughout the industry. Enabling the industry with innovative technologies requires partnerships at all levels of the digital media spectrum. Microsoft is working with Hewlett-Packard, which is using Windows Media for its its Enterprise and Commercial organization’s global marketing communications activities. According to a recent Aberdeen study, the company is already realizing seven-figure savings by using digital media more aggressively. The study also found that HP achieved payback on its streaming media technology investment in just one month.

As the industry narrows in on making online music a sustainable and profitable business, Microsoft teams with many other companies in advancing digital media. Supertracks, a new company providing complete music download solutions for retailers, is using Windows Media to take advantage of its CD-quality audio and its digital rights management technologies. Preview Systems will integrate Windows Media digital rights management technology into the company’s end-to-end solutions for retailers for digital download of music. iCAST, an online entertainment venture producing streaming media content, is working with Microsoft to develop Windows Media audio and video for the company’s next-generation application and media player, iCASTER.

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