Microsoft Showcases Windows Innovations to Help Customers Navigate Through the Digital “World of More”

LAS VEGAS — Jan. 4, 2006 — Microsoft Corp. Chairman and Chief Software Architect Bill Gates revealed powerful new innovations for Windows® customers during his keynote address at the 2006 International Consumer Electronics Show (CES), including technologies slated for the company’s next-generation operating system, Windows Vista™. Gates demonstrated how Windows Vista will bring clarity to the world of personal computing so customers can more safely and easily accomplish everyday tasks, instantly find what they want, enjoy the latest in entertainment, and stay connected at home or on the go.

“Windows and the consumer electronics industry are changing dramatically,” Gates said. “People live in a world with more digital content and information than ever before. Windows Vista will make personal computing more useful, powerful, connected and fun, redefining how we live, work and play.”

Windows Vista: Confident, Clear, Connected

Gates demonstrated how previous innovations delivered with Microsoft® Windows XP and Windows XP Media Center Edition will be enhanced in Windows Vista to create new experiences for consumers.

Safer and Easier Computing

In today’s world of increasing connectivity and computing demands, Gates said it is essential to provide customers with a more secure and responsive experience. Windows Vista will deliver computing experiences customers can count on:

  • Safer browsing. Internet Explorer in Windows Vista will offer better protections against malicious Web site operators and help prevent users from becoming victims of phishing.

  • Greater control over what children view. Windows Family Safety settings, including parental controls, will help parents monitor and manage their children’s computer use to improve their safety.

  • Enhanced protection from threats. Windows Vista will help protect computers against the latest generation of threats such as worms, viruses and spyware.

  • Adaptive performance. Windows Vista will tune itself to maximize performance for how specific individuals use the computer.

Ability to Instantly Find What You Want

Gates related how consumers are managing more e-mail, documents, pictures, video, music, games and Web sites than ever, which means they need easier access to the digital content that matters most. He went on to show that Windows Vista will help customers instantly find and use what is most important to them through enhancements that include the following:

  • Integrated search. Throughout the system, Windows Vista will provide integrated search capabilities that bring together a variety of operating system components to make it easier to store, find, manage and organize the most important data and programs.

  • New look and feel. Windows Vista will feature a fresh yet familiar user interface optimized to help find and organize information in a fast, personalized way.

  • Windows Sidebar. A new feature known as the Windows Sidebar provides quick access to real-time information, services and applications.

Connected at Home or on the Go

Gates provided examples of ways that Windows Vista enables a superior computing experience, whether on a home PC, laptop or Tablet PC:

  • Fast on/off. Windows Vista-based PCs will turn on and off more like traditional consumer electronics.

  • Windows Mobility Center and Windows Sync Center. The Windows Mobility Center will allow customers to access and change mobile computer settings from one easy place; the Windows Sync Center will unify portable devices such as phones, PDAs and music players.

  • Integrated Tablet PC functionality. Tablet PC in Windows Vista will include improved pen-based navigation, touch-screen support and customizable handwriting recognition.

Enjoy the Latest in Entertainment

Gates showed how the world of computing and entertainment come together with Windows Vista to deliver more immersive and integrated experiences across digital entertainment and media. Such enhancements include the following:

  • Integrated Media Center experience. Updated with a new look and feel that is optimized for high-definition (HD) wide-screen displays, Media Center in Windows Vista will provide access to the most important entertainment options, including music, pictures, live and recorded television and a wealth of on-demand content and online services — all at the touch of a remote control button. The Media Center experience in Windows Vista can also be moved throughout the home via the Media Center Extender functionality of the Xbox 360™ video game and entertainment system, as it can be today with Windows XP Media Center Edition 2005.

  • Expanded HD and premium TV content. Media Center in Windows Vista will also deliver new HD scenarios, including CableCARD support, that will allow people to watch and record premium and HD cable programming on Media Center PCs without a set-top cable box. Microsoft announced that a number of computer manufacturers, including Alienware Corp., Dell Inc., Gateway Inc., HP, Niveus Media Inc., Sony and Toshiba Corp., intend to bring to market digital-cable-ready Media Center PCs in the Windows Vista time frame.

  • DIRECTV. Microsoft and DIRECTV Inc. will announce a multiyear agreement that will enable the flow of DIRECTV digital content between Windows-based PCs, DIRECTV’s digital set-top boxes, PlaysForSure™ devices and the Xbox 360 system. Consumers will also be able to use a Media Center PC to enjoy high-definition DIRECTV content.

  • HD DVD. As the first high-definition format to reach the U.S. market with support on Windows Vista, HD DVD will offer consumers unrivaled picture and sound quality, extending the entertainment experience far beyond that of today’s DVDs. HD DVD will offer new levels of interactivity and the ability to stream HD DVD movies across a home network or enjoy them on portable video devices.

  • Immersive digital music. The new Windows Media® Player 11 will provide an enhanced digital media experience. Windows Media Player 11 will enable music fans to browse their music collections in new visual ways, find exactly the music they want with lightning speed, and quickly and easily take just the music they want to portable music players. Gates also announced plans to deliver Windows Media Player 11 for Windows XP, bringing the new performance and ease-of-use enhancements to millions of current Windows customers.

  • Enhanced photo experiences. With Windows Photo Gallery, Windows Vista users will have a richer digital memories experience, with the ability to share and enjoy photos and video downloaded from digital cameras. The new Windows Photo Gallery will overcome complexities inherent to acquiring and managing photos, as well as performing basic editing tasks such as correcting color and red-eye and cropping photos and video.

  • Next-generation gaming. Windows Vista will offer the most advanced computer games platform to everyone, from casual gamers to the most dedicated enthusiasts. Windows Vista will usher in a new era of gameplay with gorgeous new graphics and a powerful new game development tool set, DirectX® 10. Gates announced “Flight Simulator X,” which showcases the Windows Vista platform through stunning graphics and incredible realism. “Flight Simulator X” provides a first look at the games experiences enabled through the most powerful next-generation platform. In addition, Games Explorer in Windows Vista will make games easier to find and save, and improved graphics and Universal Controller compatibility bring PC gaming on par with consoles. Windows Vista itself will also include new games such as Windows Vista Chess, “Shanghai Dragons” and “Purble Place.”

“PC-based entertainment takes a major step forward in 2006 with Windows Vista,” said Mike Sievert, corporate vice president of Windows Product Management and Marketing at Microsoft. “HD cable support, same-day access to first-run shows, new relationships with leading companies such as MTV, and unprecedented PC gaming — not to mention today’s extended experiences offered through Xbox 360 and portable devices — will all come together in Windows Vista to create an all-in-one entertainment experience unlike any other.”

Further details on the consumer benefits and digital entertainment experiences provided by Windows Vista are available at http://www.microsoft.com/windowsvista.

Windows Services and Digital Content: More Choice, More Freedom

Microsoft announced several new offerings that will take high-definition entertainment experiences to the next level and highlighted a wide range of new services and content providers that will enhance the Windows digital entertainment experience, making it more personalized and relevant, delivering the entertainment content that matters most straight to a desktop PC, laptop or portable device.

Personal Entertainment Choices for Windows

  • URGE music service. MTV Networks’ forthcoming digital music service, URGE, will be deeply integrated into Windows Media Player 11 and offer more than 2 million songs from the major labels and thousands of independents, as well as exclusive MTV Networks programming and original content. URGE will also be available through Windows Media Player 11 for Windows XP.

  • Sky Networks. Microsoft and British Sky Broadcasting (Sky), the leading pay-TV provider in the U.K. and Ireland, today announced an agreement to create a Media Center PC version of Sky’s forthcoming broadband content service, Sky by broadband. The core service will allow millions of Sky TV customers to access video content via the PC, with hundreds of movies to download and hundreds of sports clips to stream.

  • Starz. Starz Entertainment Group recently premiered Vongo, a new video download service for broadband that will give subscribers unlimited access to more than 1,000 movies and video selections as well as a live, streaming Starz TV channel, for a monthly cost of $9.99. Movies can be viewed on a Windows-based PC or easily transferred to a next-generation Windows Mobile®-based Portable Media Center.

Expanded Services for Windows XP Media Center Edition 2005 Customers

Customers of Microsoft’s current digital entertainment platform, Windows XP Media Center Edition 2005, already have access to unlimited TV shows, movies, music videos and more through the Media Center’s digital video recorder (DVR) capabilities. Further, some 110 media companies around the world are providing digital content through the Media Center Online Spotlight feature. Upcoming new Online Spotlight providers include these:

  • Comedy Central’s MotherLoad. Comedy Central’s MotherLoad features exclusive and dedicated content including video clips from current and classic Comedy Central shows such as “The Daily Show with Jon Stewart.” Additional exclusives and dedicated content include sneak previews, behind-the-scenes exclusives, highlights from thousands of stand-up performances, and newly created short-form series such as “I Love the Thirties,” “Odd Todd” and “Meet the Creeps.”

  • mtvU. mtvU is the only 24-hour network dedicated to emerging music and everything that’s great about college. mtvU is the first MTV Networks broadband channel to be distributed in its entirety both live and on demand on via Windows XP Media Center Edition, enabling viewers to program their own channel or just sit back and watch. At the heart of the channel are music videos from emerging artists that can’t be seen anywhere else.

  • Showtime Interactive. Showtime Interactive allows viewers to explore hundreds of Showtime programs and a wealth of DVD-like video extras such as behind-the-scenes clips, trailers and trivia as well as actor interviews, bios and filmographies.

  • Turner Broadcasting System Inc.’s GameTap. GameTap is a first-of-its-kind broadband subscription entertainment network that offers more than 300 games on demand plus original programming via a broadband-connected Media Center PC.

  • VH1 VSPOT. VSPOT, VH1’s pop culture and entertainment broadband network, delivers VH1’s best video programming on demand to Media Center PCs. VSPOT’s Music, Moves and Hot Stuff channels offer thousands of music videos, artist interviews, live events coverage, behind-the-scenes access and exclusive in-studio performances, from artists such as The White Stripes and INXS.

In addition to new Online Spotlight options, Windows XP Media Center Edition 2005 customers will also be able to take full advantage of several new Windows Live™ services:

  • Live.com TV gadgets. Live.com provides the ideal location for services that make it easier to find and manage TV-related experiences across multiple devices. Customers can easily see TV programs scheduled for recording along with best bets. These services provide a window into one’s Media Center PC from almost anywhere in the world.

  • Live.com TV recommendations. Live.com enables customers to easily rate shows they’ve watched on their TV via their Media Center PC. As users rate more shows, they get better, more personalized TV recommendations, which they can share with their community.

Windows XP Media Center Edition Successes Lay Groundwork for Windows Vista

Gates also discussed widespread customer and industry momentum for Microsoft Windows XP Media Center Edition. Windows XP Media Center Edition has become a standard platform for digital entertainment in the PC industry, with sales having reached the 6.5 million mark in just three years. In addition, Windows XP Media Center Edition 2005-based PCs enjoyed a healthy holiday season. According to analyst firm Current Analysis Inc., nearly half — 47 percent — of all home desktop PCs sold in the U.S. in the month of December were Media Center PCs.

Gates went on to show how the Windows ecosystem continues to grow and thrive with an amazing diversity of hardware for Windows, as evidenced by an exciting new Media Center PC form factor being jointly developed by Averatec and AMD and scheduled to be available later in the year. There are currently some 130 computer manufacturers offering Media Center PCs in 33 geographies worldwide.

Microsoft is also teaming up with Intel Corporation to propel the digital home phenomenon with Intel Viiv technology, Intel’s new platform for digital entertainment that will launch in early 2006 with the multitasking power of a dual-core processor-based PC. Gates showed off an Intel Viiv technology-based PC as part of his keynote; every Intel Viiv PC that ships this year will be a Media Center PC, providing customers with the ultimate platform for managing and enjoying digital entertainment.

“Microsoft has built a great foundation for entertainment with Windows XP Media Center Edition,” said Don McDonald, vice president and general manager of the Digital Home Group at Intel. “PCs based on Intel Viiv technology are going to up the ante in the entertainment PC market by matching our powerful processors, software and content services with Microsoft’s Windows XP Media Center Edition software. Customers purchasing Intel Viiv technology-based PCs can rest assured they will be getting a cutting-edge entertainment PC built to deliver the very best software and services available today.”

In addition, AMD announced plans to extend the professional AMD LIVE! brand to feature-rich consumer multimedia desktop and notebook PCs expected to be delivered in mid-2006. AMD LIVE! will be an innovative, complementary, industry-friendly solution that enhances the consumer electronics and broadcast devices already accepted and used by consumers today. AMD LIVE! can offer users the ability to seamlessly connect, store, distribute, access and enjoy digital media content in multiple rooms throughout their home and take it with them to enjoy on the go.

“AMD’s digital media vision applies the power and flexibility of the PC to enable enhanced digital entertainment experiences on all the screens in peoples’ lives,” said Iain Morris, senior vice president of Digital Consumer Media and Pervasive Computing at AMD. “AMD LIVE! combined with Microsoft Windows XP Media Center Edition will offer full-featured multimedia desktop and notebook PCs, empowering consumers to seamlessly enhance their entertainment experiences with personal, interactive applications and digital media content.”

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

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