CES Highlights PC as Digital Media Hub

New pieces are falling into place in Microsoft’s plan to establish the PC as a digital media hub, which the company hopes will drive consumer PC upgrades and garner licensing fees from device manufacturers. Partners who help Microsoft in this strategy, particularly traditional PC OEMs, could gain entry to the consumer electronics business by creating devices that connect to the PC and take advantage of its digital media capabilities. However, other companies are pursuing similar strategies based on competing technologies, so format incompatibility and market fragmentation may limit the opportunity.

Several announcements at the Jan. 2004 Consumer Electronics Show (CES) illustrate Microsoft’s continuing efforts in this area. Most notably, upcoming products from Microsoft and PC OEMs will allow users to connect a TV set to a Media Center PC over a home network, making it possible for the TV to serve as a “spoke” in a PC-based hub for home entertainment. Microsoft also announced new technology to enable consumer electronics devices to stream media stored on a standard PC, and new partners for Portable Media Center devices and other key technologies.