Saturday, June 28, 2008

Microcosm

After a recent catch up with Microsoft, and in light of the recent retirement of its founder, I thought that it may be worth reflecting on what role Microsoft are likely to play in the future of the Internet TV industry.

In general, the company seems to be leaning toward the enterprise and appears to see the move of applications away from the desktop to the server as a done deal. However, their approach and pricing for this market - especially for their excellent database products - remains restrictive. Aaded to this is the fact that the media sector is a very thin slice on their revenue pie chart, so has never really commanded enough attention.

Silverlight seems to have been a success and the Expressions Encoder, which replaced Windows Media Encoder, is a very, very impressive application, although restricted to the VCV1 codec. However, video players developed in Silverlight, such as those from Narrowstep, seems incredibly slow to load and have problems on pre-Intel Macs. Adobe's Flash technology is proving to be ubiquitous and even powers the video on MSN - an admission of defeat if ever there was one.

Microsoft's DRM remains the only real option on the market - I've yet to see really successful implementation of rival solutions such as WideVine on any scale. This is a real strength that the company does not seem to leverage.

Microsoft IPTV has been less of a success and I've heard nothing but horror stories about its implementation including the first customer, Swisscom's decision to quietly drop the technology.

On the desktop Windows Media Centre Edition was a real let down. It was difficult to develop for and even more difficult for users to set up. Most people who bought computers with this OS just ignored the EPG interface and this has continued with its integration into Vista.

There's little doubt that Microsoft has figured out that it will not be able to charge top dollar for its products forever in a world where things are increasingly free or advertising driven. This is why they have persevered with the millstone that is MSN and bought Accipiter and their Atlas online ad system.

Now, this is where things begin to unravel. Microsoft is never going to catch up or even compete with Google in this space, even teaming up with Yahoo! would not have brought them the clout they required and would have turned them into something they will never be - a media company.

The reality is, Microsoft are going to become increasingly dependant, as many, many major corporations are, on Google for their future.

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