The Long-Term Goal for MSTV: Own the Residential Gateway

Although Microsoft is jumping aggressively into the embryonic market for interactive TV service delivery, the market it really wants is still several years in the future.

Today’s rather mundane cable TV set-top boxes (STBs) will evolve into advanced network devices called “residential gateways.” Residential gateways hold the potential to replace existing telephone service with next-generation Voice over IP (VoIP) telephone service and cause a wholesale restructuring of today’s telephone service delivery market. Already available from vendors such as Motorola, Scientific Atlanta, and 2wire, Inc., residential gateways are network “routers” that deliver not only entertainment programming and interactive TV services but also VoIP and traditional data network services like Internet connection sharing, personal firewall, and virtual private networking. No matter who supplies the residential gateway hardware or the circuit that connects to the Internet, Microsoft is working hard to guarantee that it is the preferred provider for residential gateway software.