October, 2003

Content providers beware: if this Microsoft Media Centre PC is hooked up to a fast enough broadband net connection, downloading TV shows and even films and sending them to the TV to view is possible.

There has long been talk about the role of the gatekeeper in pay TV. In the UK, Sky is the biggest gatekeeper, controlling not only millions of subscribers but lots and lots of content. In terms of size and clout, the cable business in the UK is Austin Powers' Mini-me to Sky's Dr. Evil.

But the game seems to be changing, as other Dr. Evils bent on world domination -- or at least a slice of the pie-- begin elbowing in.

Microsoft's Media Centre software, pre-loaded on certain PCs, is a big shagadelic case in point. Based on a hybrid Windows XP operating system, Microsoft wants to turn your PC into your home entertainment hub. The software giant has skirted objections to watching telly on the PC in a very clever way: you programme your TV from your PC using your Web-updated, two-week-in-advance Microsoft electronic programme guide (EPG), but you can actually watch the show on the telly screen in the lounge, if you wish. And the Media Centre software also works with any set top box that is already attached to the telly, be it from Sky, cable or Freeview.

Once your Media Centre-powered PC is linked to your telly you can do a lot more than just programme your night's viewing. You can view digital photos,. Listen to downloaded music tracks ad watch DVDs, all routed from the PC.

Blurring the lines even further between the PC and the TV, included in the purchase of a Media Centre-powered PC is an infrared handheld remote control for scrolling through your PC EPG, and that can also control your Sky set top box.

Microsoft launched its Media Centre software in the US a year ago on Hewlett Packard PCs but so far no sales information has been published. The new breed of PCs have been selling in the US for $1,000-plus and researchers IDC Corp. believe that sales there have probably been in the 10s of thousands.

A second US launch (with an updated version of the Windows software) and the first "new PCs" to launch with Media Centre in Europe will be supported by many more PC makers, notably Sony and Dell, which will add marketing clout and should also drive lower prices. However, opening prices in Europe will likely start at Euros 1,500.

So will people buy them in droves? Maybe not right away, but Europe is less PC-penetrated market so there could be more space for the as PC entertainment hub that not only runs your TV but also brings you the Web and lets you write letters and organise your house finances. And of course content providers beware because if this Media Centre PC is hooked up to a fast enough broadband Net connection, downloading TV shows and even films and sending them to the telly is also possible.

So should the TV world take Microsoft's moves seriously? One interesting recent development (perhaps reaction) was Sky's decision in September to drop the £10 per month charge for subscribers to its Sky Plus personal video recorder (PVR) service. Sky Plus allows you to organise your TV viewing and set the recording of favourite shows up to a week in advance through an on-screen EPG.

If you have a Media Centre-powered PC, it does the same, but there is no need for a Sky Plus box. The hard disc for recording programmes is in the PC "We are talking to Sky all the time about plugging in other services like interactivity using the Web but this is at the early stages and now they obviously see it as a competitive technology," admits David Weeks, Microsoft's ehome manager based in the UK. "This is what the broadcasting industry has been looking for, a way to integrate broadcast and Internet and Media Centre is the start"

Microsoft obviously sees its new breed of PC as much more capable than a set top box, but one big problem is a basic one: the wires that are needed to link the PC to the TV. Today wireless networks used in the home (typically using 802.11b) are not robust enough to support full screen video streaming.

So is killer content going to be superseded by killer capability? Certainly in a content rich and fragmented media world, the EPG is the weapon of choice for gatekeepers, be they from the TV or the PC or even the mobile world.

Even the BBC has announced it's developing a platform neutral "super EPG" that will allow PVR-style recording and replay as well as the downloading and streaming of recently aired programmes to PCs and hand-held devices, much like Real Networks and Windows Media Player do today.

The BBC's director of New Media Ashley Highfield says the BBC's Internet Media Player somewhat controversially will also use peer-to-peer (P2P) file sharing so the Beeb's own networks don’t overload.

So there are EPGs and mini-EPGs and now PC-EPGs and even a forthcoming super EPG.