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CES 2009: Microsoft CEO Says Screens Will Converge

Las Vegas -- Microsoft CEO Steve Ballmer, in his first CES keynote, said one of the biggest areas of opportunity for the consumer-electronics industry -- even given the current economic recession -- is to converge the capabilities of PCs, phones and TVs.

“In the future you will be able to connect to information and people you care about instantly, across any of those screens,” Ballmer said, delivering the trade show’s lead-off address Wednesday evening. 

(Click here for MCN's complete CES coverage.)

The TV has the most potential for evolution as an Internet-connected platform, according to Ballmer. “For more than 60 years the TV has been at the center of the family entertainment experience,” he said. “But the capabilities have largely remained the same.”

As TVs become more networked over the next few years, “the boundary between the TV and the PC will dissolve,” Ballmer said. 

Of course, tech pundits and executives have long predicted the convergence of televisions with PCs -- with no significant breakthrough that has bridged those two distinct worlds, yet.

Ballmer said HDTV displays will become cheaper, lighter and more portable, presenting a significant opportunity to link those into a broader set of information and applications: “Screens and displays will literally be everywhere.”

In a separate presentation, Robbie Bach, president of Microsoft’s entertainment and devices division, said the company will launch a new "Primetime" channel for the Xbox gaming console later this spring.

The Primetime channel is “a strategy to create scheduled programming and live events,” Bach said. As an example, he showed “1 vs. 100,” an interactive trivia game for Xbox Live adapted from the TV show that airs on NBC, with four players playing over the Internet.

Another new Xbox Live channel, Community Games, will allow users to create, distribute and share their own games for the game platform.

Bach said Microsoft has sold 28 million Xbox gaming consoles worldwide, and has signed 17 million members to its Xbox Live subscription service (3 million of those in the fourth quarter of 2008). And he noted that customers of the company’s Mediaroom IPTV platform, which include AT&T, are continuing to scale up service with 2.5 million customers worldwide.

In his keynote, Ballmer announced that Microsoft has released the beta version of Windows 7, the next major release of the company’s flagship software product, to developers. He promised would be the “best Windows ever,” booting faster, improving reliability and providing easy access to media.

In addition, he said, Microsoft on Friday will make the Windows 7 beta available online to the public.

Windows 7 includes new navigational elements, such as being able to “snap” two windows next to each other; HomeGroup, which allows sharing of files and media among devices; and support for touch-enabled applications.

In other announcements, Ballmer said Microsoft has struck a five-year deal with Verizon Wireless to provide search functions on its wireless phones and a similar deal with Dell for its PCs. He also said Microsoft’s Windows Live messaging and social-networking service will be linked in with Facebook, so Windows Live users can receive updates.

The “pre-show” keynote at CES had been delivered by Microsoft founder Bill Gates the previous 14 years.

At the outset of his talk Ballmer, named CEO of Microsoft in 2000, joked that he had received words of advice about his CES appearance from industry executives. 

"Bill [Gates] said, 'Make sure you go to the right convention,'" Ballmer said, alluding to the Adult Entertainment Expo, which is typically held in Vegas the same week as CES.

Then Ballmer quipped, “Jerry Yang [CEO of Yahoo] said, 'Why do you keep ignoring my friend requests on Facebook?'” -- a reference to Yahoo’s initial rejection of Microsoft’s bid to acquire the Internet search and media company, and then Yang's subsequent interest in resuming merger talks.