Latest on EU antitrust

Microsoft's deadline for complying with the European Commission's antitrust order is hours away at this point, but it looks like the outcome might not be clear until next month. The Associated Press reports that the European Commission "expects to make a decision by the end of July on whether to impose new fines."

Update: On this page, you can access the video of today's European Commission press briefing where the Microsoft case was discussed. (Go to Tuesday 31/05, scroll down and click on 12:10:20.)

Microsoft eyes podcasts

Microsoft is apparently paying close attention to Apple's plan to give its iTunes music software a "podcatching" feature -- letting people use the program to subscribe directly to audio programs, or podcasts, that are then downloaded automatically when new content becomes available. (Currently such functionality requires an extra program such as iPodder or iPodderX.)

During the revival of the Gillmor Gang audio program over the weekend, podcasting pioneer Adam Curry said he had been trying for some time to persuade Microsoft and Apple to pay attention to the trend and build podcatching features inside Windows Media Player or the iTunes software. He said things changed when Steve Jobs demonstrated the new iTunes podcatching feature last week at the Wall Street Journal's "D: All Things Digital" conference. On the Gillmor Gang, Curry explained what happened next:

"It was like 15 minutes after it showed up in the Wall Street Journal when Microsoft called, saying, 'Hey, how do we get in this?' I don't know a lot about Microsoft. I do see they're a lot hungrier company than they used to be. But every single time you talk to them about anything that's new, or in this case iPodder functionality inside Windows Media Player, the almost standard answer is, 'Yeah we're going to have a lot of that in Longhorn.' That to me means there is this huge steamboat that is very difficult to steer left or right, and it's just harder to get stuff done at Microsoft."

That's just a snippet of an interesting discussion of the topic. You can download the full program via the Gillmor Gang link above.

On the same subject, Microsoft's Robert Scoble pointed out over the weekend that one podcasting group, the Podcast Network, was wondering how to get its programs into the new iTunes version. Wrote Scoble: "I don't know anyone on Apple's iTunes team, but I will pass this to our podcasting team. Oh, am I even allowed to admit that we have a podcasting team? Heh, the secret is out."

Update: Scoble offers his take on some of the Gillmor Gang's comments.

No mourning end of 'my'

Based on the e-mail messages from readers so far, I feel comfortable predicting that Microsoft won't see a huge backlash from users after retiring the prefix "my" from the Windows desktop folders when the company releases the next version of the operating system. Typical of the reaction was this message from online reader Lawrence Auster of New York City:

"This is good news. The change from 'My Documents,' 'My Music,' etc., to simply "Documents," etc. is fine with me. As soon as I learned the ropes of Windows 98 when I got my computer back in 1998, I changed the name of the 'My Documents' folder to 'Documents' and of 'My Computer' to 'Computer.' I thought the 'My' was ridiculous and childish."

Auster expands on his thoughts on his weblog, pointing out that the phrase "also makes conversation about computers awkward: For example, if you are giving advice to someone about his computer, you have to say, 'Now look in My Documents.' But of course you're talking about his documents, not your documents. ... "

Some people feel even more strongly about the situation. Reader Janice Lukas, for one, hopes this starts a trend that eradicates the prefix from the technology world entirely. She writes in an e-mail message:

"You cannot know how strongly I dislike anything on the net or otherwise that contains the 'my' preface. I find it to be condescending, insulting and sneering and liken it to the overly sugared 'my little pony' garbage. My solution was to never use or participate in anything starting with my. Good riddance to 'my.' "

No messages or calls yet expressing any lament over Microsoft's decision.

Xbox 360 retail kiosk?

The Xbox365 site is showing an image that suggests the retail kiosks for the upcoming Xbox 360 won't just be for playing games. No. 5 on the accompanying key: "Keep customers coming back for great content with the built-in Memory Unit Port. Plug in, load up and enjoy." (Via Engadget.)

Report: Reed ties cut

Seattle Weekly, citing two anonymous company sources, reports that Microsoft is cutting its ties to former Christian Coalition leader Ralph Reed, whose consulting relationship with the software company came under scrutiny amid Microsoft's changes in position on Washington's gay-rights legislation.

Update: Microsoft is confirming that it has ended its relationship with Reed. See this story by P-I Washington correspondent Charles Pope for the details.

Showdown in Europe

The June 1 deadline for Microsoft to comply with the European Commission's antitrust ruling is looming.

One major sticking point appears to be the terms under which the company will share technical information with rivals in the computer server market, to help their programs work more effectively with Windows. BusinessWeek details on the situation in this story, quoting a lawyer who says the outcome will be "a defining moment" for European Competition Commissioner Neelie Kroes. The Financial Times reports that the commission shows "no sign of backing down."

Meanwhile, the Wall Street Journal reported this week on RealNetworks' ongoing contention that Microsoft should be required to sell the special version of Windows without Windows Media Player for less than it sells the full-fledged version. The commission ordered Microsoft to sell the stripped-down version, potentially opening the door to alternative digital media players, but Microsoft says the order doesn't prevent it from offering both versions for the same price. Logically speaking, computer makers and consumers would have less incentive to buy Windows without the media player for the same price as they could buy Windows with the media player. But the WSJ says the European Commission is "reluctant" to tackle that aspect of the issue.

Google CEO on Microsoft

Google CEO Eric Schmidt made a pair of public appearances in Seattle yesterday, speaking at a Technology Alliance luncheon and later addressing a packed auditorium of University of Washington computer science students. As explained in our story this morning, he was asked at both events for his views on Google's competition, and he identified Yahoo as the primary competitor in the search business. He also mentioned Microsoft, but in a way that cast the company as more of a secondary competitor.

Maybe it was the big Microsoft sign behind him, or the two tables full of Microsoft people in front of him, but Schmidt seemed to be more careful with his words about the Redmond company during the Technology Alliance event -- saying that Microsoft is "just getting going" in the search business.

At the UW event, he was slightly more blunt, saying that Microsoft is "not a significant competitor yet" in the search business.

But it's not as if Google is ignoring the existence of Microsoft's MSN Search. During his UW speech, Schmidt showed a series of slides of mock magazine covers, including one that imagined what it would have been like if Google founders Larry Page and Sergey Brin had gone to work for Microsoft. The cover envisioned that the two had become the saviors of MSN Search. Schmidt feigned lament and quickly moved to the next slide.

Assessing Apple, Intel

CNet News.com notes that Intel's Paul Otellini is neither confirming nor denying the Wall Street Journal report that Apple is considering switching to his company's microprocessors in the Macintosh line.

However, Otellini describes it as "the Halley's Comet of rumors...comes around every five years or so," CNet reports. Similarly, Jupiter Research analyst Michael Gartenberg calls it "the never ending rumor that's lived since the mid 90s." He adds, "It wasn't likely then and it's less likely now for Apple's personal computers."

Concurs Leander Kahney on the Cult of Mac blog: "The rumor that Apple is considering Intel chips for the Mac platform is nonsense. Literally. Non-sense. It makes no sense."

Kutaragi on 'Xbox 1.5'

In an interview with Impress PC Watch, Sony's Ken Kutaragi, the father of the PlayStation consoles, says the company thinks of the PlayStation 3 as "not a game machine" but rather an entertainment computer. (Translated by GameSpot.) He explains:

"We haven't been creating our [past] PlayStations for the sake of games. Our belief, and the motivation behind running our company, has been to [explore ways of] applying the power of computers to entertainment and enjoyment. We equipped the original PlayStation with a 3D graphics chip, and we equipped the PS2 with the Emotion engine. The PS3 isn't designed to lean towards games. It's not a computer for children. In the sense that our goal has been [to create] a computer that's meant for entertainment, you could say that the original PlayStation and PlayStation 2 had existed as steps towards the PlayStation 3."

The story notes that Kutaragi "went on to say that Microsoft's new game console is more of an 'Xbox 1.5' than a new console, in the sense that it seems like an extension of the original Xbox." (Via Engadget.)

Gizmodo modifies the image of the next Xbox accordingly.

On a related note, Xbox Live's Major Nelson this week posted a series of items seeking to counter Sony's contention that the PS3 will be technologically superior to the Xbox 360: Part One, Two, Three, Four.

Intel CEO on spyware

Another interesting tidbit from the Wall Street Journal's D Conference, this one from an on-stage interview of Intel CEO Paul Otellini by the WSJ's Walter Mossberg:

Pressed about security by Mr. Mossberg, Mr. Otellini had a startling confession: He spends an hour a weekend removing spyware from his daughter's computer. And when further pressed about whether a mainstream computer user in search of immediate safety from security woes ought to buy Apple Computer Inc.'s Macintosh instead of a Wintel PC, he said, "If you want to fix it tomorrow, maybe you should buy something else."

Inside 'MSN Virtual Earth'

Microsoft's Channel 9 site has an extensive video, including demos, with the team behind Microsoft's upcoming MSN Virtual Earth satellite-mapping search service, announced by the company yesterday as a counterpoint to Google Maps and Google's Keyhole service, recently renamed Google Earth.

The new MSN service is expected to be launched this summer. (Click on the screen shot at right for a larger image of the prototype.) Parts of it will look very familiar to people who have used Microsoft's TerraServer service. Other parts are completely new -- such as the 45-degree overhead angle, a demonstration of which starts about 21 minutes into the video. Some of the coverage thus far: John Battelle, Search Engine Watch, SearchViews, CNet News.com.

Jobs, Gates at WSJ confab

Lots of interesting tidbits from this summary of appearances by Steve Jobs, Bill Gates and Scott McNealy at the Wall Street Journal's annual "D: All Things Digital" conference -- including Jobs on stage, ribbing Gates in the audience about whether or not he was an iPod user.

Microsoft's bully status

Joseph Nocera of the New York Times considers whether Microsoft has changed in the five years since the conclusion of its U.S. antitrust trial: Google This: Is Microsoft Still a Bully? Among other things, he points out the serious threat posed by Google, and considers how Microsoft might have responded before the antitrust trial:

In the old days, said Tod Nielsen, a former Microsoft executive, the company would have raced to add some kind of quick-fix Internet search "functionality" to Windows. "And we would have found a way to attack their business model, too," he added. That this has not happened is, to my mind, the most powerful evidence that the company's behavior has been tempered by the antitrust trial.

On the other hand, it seems quite likely that when Longhorn is finally rolled out -- currently scheduled for late 2006 -- it will have some kind of Internet search feature. It will be easy to use, seamlessly integrated with Windows -- and will have been seriously vetted by the lawyers, so that it at least minimizes any potential antitrust problems.

Here's what Windows chief Jim Allchin had to say on that same subject when I asked him about it a few weeks ago:

Q: To what extent will Microsoft's MSN Web search be integrated into Longhorn?

Allchin: There are many powerful Web searches out there, and we're going to have to have an open platform where people can plug those in. I don't think that all the t's are crossed and the i's dotted, but we have an open environment there in XP, and you can just expect that to continue in terms of being able to plug in your favorite search.

The question is how far we can go for everyone, not just one, for being able to visualize some of that information in more natural ways. Sometimes you want to see Web search results integrated into what you're doing, and in other cases you don't, and so we have usability work going on trying to figure that out ... but it will end up to be an open environment.

Q: Is that an antitrust consideration, not wanting to favor MSN Search within Windows?

Allchin: You'd have to ask the attorneys on that, but we had an open platform, and we're going to continue to have an open platform. We have a consent decree which says a certain set of things, but this sort of goes beyond that. You know what we did with Media Player. (The company included competing music services alongside its MSN Music store within Windows Media Player 10.) We think that's good for consumers, so it's more from that perspective.

Nocera also discussed his story on NPR's Weekend Edition. Joe Wilcox weighs in on the subject of Nocera's story in this post on the Microsoft Monitor weblog.

Report: Intel-based Macs?

The Wall Street Journal reports today that Apple is exploring the possibility of using Intel chips in the Macintosh line. (Apple currently uses IBM chips.)

Intel, of course, is the dominant chipmaker for Windows-based PCs. But the Wall Street Journal quoted an anonymous industry executive as saying that, even if it were to switch to Intel, Apple isn't likely to offer its Mac OS X operating system for non-Apple computers.

Explains the Journal story: "Besides hurting its own hardware business, such a path would put Apple in more direct competition with Microsoft, whose application programs are important to the success of the Macintosh. Instead, the company is likely to package its modified software with its own Intel-based hardware, though it is not clear how the company will prevent users from shifting the software to other machines, the executive said."

E3 coverage roundup

For anyone who visits this weblog for something other than video-game news, relief is on the way. In the meantime, just to make them all available in one place, here's a roundup of our stories leading up to and during last week's E3 video-game convention:

Executive Q&As:

• Robbie Bach, chief Xbox officer
  
• Kaz Hirai, Sony Computer Entertainment America president
  
• Satoru Iwata, Nintendo president

Stories:

• Gates leaks 'Halo 3' release date ... maybe
  
• Will Xbox 'speak' Japanese?
  
• Nintendo unveils Revolution
  
• Microsoft seeks lead in early Xbox release
  
• Microsoft, Sony put on game faces
  
• Game console war shifts into high gear
  
• Xbox 360: Hard core, but aiming for more
  
• Microsoft begins new Xbox battle
  

50 Cent: Video-game star?

Before leaving E3 on Friday, I got a chance to tour the booths of some of the major game publishers, including Activision, 2K Sports, and Vivendi Universal. One game that stood out was "50 Cent: Bulletproof," a third-person shooter starring the rapper and featuring his music and videos. From what I saw, it's an extraordinarily violent and profane piece of entertainment. In other words, it's probably destined to be a hit. (It's slated to be released for PSP, PS2 and Xbox next year.)

But the better indication of the game's prospects was what happened at the beginning of the media briefing I attended, which was in a private room above the show floor: Two guys whose badges said they were from competing publisher Electronic Arts were politely asked to leave after quietly sitting down in the back to try to get a peek.

PS3, Xbox 360 online

At the outset of our interview yesterday, Microsoft Xbox chief Robbie Bach said the one thing that surprised him about this year's E3 was that Sony didn't announce anything to compete with Xbox Live. (The Xbox online gaming system charges a subscription fee to be able to play any "Live-enabled" Xbox game online, while Sony leaves the online experience in the PlayStation 2 primarily up to the publishers and developers of individual games.)

I pointed out that Sony had talked about a concept called the PlayStation Network, and put up a slide about it during its media briefing earlier in the week. Bach answered: "Let's put that in context. We've been writing real code and delivering a service for three years. We have 2 million subscribers. They have a slide."

For the record, that image above is the slide in question. Out of fairness, after looking back through my photos, I should point out that there were actually two slides on the subject.

In all seriousness, here's what Sony's Kaz Hirai had to say on the subject of online gaming during our interview earlier this week, when I asked him whether the PlayStation Network would represent a more centralized system:

Yes, to a certain extent, but I do feel that one of the reasons why we still continue to have the largest number of online players is that most users are happy with their experience, number one, and a lot of the publishers have decided to support the open online environment that we've provided for the current PlayStation 2.

Having said that, for some smaller publishers and other publishers that may not want to make the sizable investments, we need to be cognizant of that, as well, and be able to help them out. And as a consumer experience, there are some important community features that I think need to get put into a new system, as well.

I do, however, think that it's a fine balance. You don't want to be in a situation where you have to turn around on the business end and say, this is how it's going to be done, take it or leave it. You've got to have more flexibility.

Xbox 360 and Japan

One excerpt that didn't fit into the published version of our Q&A with Xbox chief Robbie Bach today was the company's prospects in Japan. (See also our Thursday story for more on the topic.) Here's what Bach had to say:

Japan, as most people know, as been a struggle for us on Xbox itself. But I think Xbox 360 has real possibilities there. We've done a great job lining up content. We announced here that Square Enix would join the platform for the first time. Our own Microsoft Game Studios is producing a series of games with three of the leading producers in Japan. ... Do I think we're going to have the same market share in Japan as we'll have in North America and Europe? I'd like to dream that, but I don't think that's probably very realistic. But do I know we're going to make Sony work really, really hard for everything they get in Japan? The answer to that is absolutely yes.

More on PS3 dual output

Since the usefulness of the PlayStation 3's dual-screen output has been the subject of some debate, here's a photo I snapped during Sony's E3 presentation that explains the company's vision for some of the potential uses of the feature.

Snooping on a rival

Rule No. 1 for business travelers: Don't read secret documents on the plane. To which you could add: Especially if you're a Nintendo executive flying out of Seattle, going to E3, with a nosy Microsoft Xbox employee sitting across from you.

GameBoy Micro face plate

Microsoft's Xbox 360 won't be the only new machine with a face plate that can be removed and replaced with a different pattern or color. Nintendo's Game Boy Micro, introduced this week and due out later this year, comes with a similar feature.

In briefings yesterday, Nintendo President Satoru Iwata was proudly showing off a Game Boy Micro with a faux wood finish. Nintendo said in its announcement that users will be able to buy custom face plates for the tiny machine. Iwata said details such as the price of the face plates haven't been established. (The company also hasn't yet announced the price of the device itself.)

Xbox chief discusses PS3

Robbie Bach, Microsoft's chief Xbox officer, was asked about Sony's PlayStation 3 plans during a briefing with financial analysts Tuesday afternoon here at the E3 convention. Among other things, Bach questioned the merit of some of the extra features Sony is planning for its console, such as the ability to output to two high-definition screens simultaneously. It's difficult enough to get many people to upgrade to one HD screen, let alone two, Bach pointed out.

He then talked about the potential cost of such extra features. For its part, Microsoft has sought to keep costs low in the Xbox 360, attempting to reach profitability. "It looked like the cost of goods of the box they displayed was going to be pretty high," Bach said. "It will be interesting to see what they do with that."

Neither company has announced the price of its console.

Maroon 5's Nintendo fan

Maroon 5 played Nintendo's E3 party Tuesday night in Hollywood, and apparently it was an appropriate choice of band, based upon the gaming preferences of lead singer Adam Levine. Not long into the performance, during an instrumental portion of one song, Levine started reminiscing about playing Nintendo games growing up. He spoke affectionately of games including Super Mario Bros. and Castlevania.

But for all his talk of Nintendo, it seems that Levine and the rest of the band also have had some involvement with one of its rivals. Just goes to show how hard it is to get exclusives in the video-game business these days.

Nintendo's Revolution

Nintendo today will unveil its new console, code-named Revolution, and USA Today has an early look at the machine in this morning's edition.

Xbox lands Square Enix

Microsoft's surprise today at the E3 video-game convention was the announcement of a deal to bring games from legendary Japanese video-game company Square Enix -- the company behind the "Final Fantasy" series -- to the Xbox platform. The deal is notable in part because Square Enix had previously avoided making Xbox games altogether.

But it's not as if Square Enix is turning its back on Sony's current or future PlayStation consoles. Case in point: Square Enix President Yoichi Wada appeared at the Xbox E3 briefing with Microsoft's Robbie Bach to announce the deal to bring "Final Fantasy XI" to the Xbox 360. But just a few hours earlier, he had been on stage at the Sony event, talking about plans to develop games for the PlayStation 3 and to bring "Final Fantasy XII" to the PlayStation 2.

Ballmer, Gates and Xbox

Microsoft's top executives, Bill Gates and Steve Ballmer, appeared in a video segment shown at the Xbox E3 media briefing Monday night, arguing over the relative merits of the Xbox 360. Ballmer, as you might imagine, was really hamming it up. The punch line came at the end, when the camera revealed that they were playing not some high-powered, action-filled video game but rather a game of electronic checkers.

As the segment ended, Xbox executive J Allard remarked to the crowd that it proved the Xbox 360 is suited for all ages and demographics -- including "billionaire software moguls trying to be funny."

360 backward compatible

Giving a long-awaited answer to one of the key questions about the Xbox 360, Microsoft said Monday that the new console will be backward compatible with top-selling original Xbox games. Exactly how many games that means in the long run remains to be seen, but Microsoft said "Halo" and "Halo 2" will be on the list, as you might imagine.

As we reported last week, the issue of backward compatibility had been up in the air. It turns out that one of the main issues that had created the uncertainty was, in fact, the need to license intellectual property from Nvidia, the maker of the graphics chip for the original Xbox. Microsoft was able to reach an agreement with Nvidia "over the last few weeks," said David Hufford, an Xbox group product manager.

It's a good thing for Microsoft -- especially since Sony on Monday announced that the PlayStation 3 will be fully backward-compatible not only with the PlayStation 2 but also with the original PlayStation.

Gates on 'Halo 3'

That's the cover of the latest Time magazine. But what's likely to get even more attention is the parenthetical portion of this paragraph inside:

Of course, war gamers aren't what really occupies Gates. He has them already. (Note to the hard-core faithful: the next version of Halo will not, repeat not, be ready in time for the launch of Xbox 360. It will be part of the all-important second wave next spring. "It's perfect," Gates says, radiant with bloodlust. "The day Sony launches [the new PlayStation], and they walk right into Halo 3." Microsoft is expected to announce that Xbox 360 will play Halo 2 and other Xbox games.) But there's still a significant demographic that for some reason doesn't consider wiggling a joystick to pretend they're shooting somebody a major priority in their lives. To woo this wider group, video games will have to get easier, more approachable, and they will have to expand into genres that don't yet exist.

Revisiting the Xbox leaks

Many of the leaks in the two weeks leading up to the Xbox 360's launch were right on the money, in part because some of them came from the taping of the MTV launch special a week before it aired.

But what about those earlier rumors, the ones that came several months in advance? One that seemed especially far-fetched at the time was the report more than a year ago from a purported encounter with Xbox executive J Allard at a bar in Whistler, B.C.:

"... Anyway, we were talking about the Xbox 2 and he said their current plan was not to include a hard drive in the Xbox 2 itself, but to offer a portable hard drive as an accessory you could buy separately. Here’s the kicker: He said what they were trying to do was to incorporate MP3 (and WMA, obviously) functionality into the portable hard drive and turn the thing into an iPod killer. ... "

Suddenly that's not far-fetched at all, although Microsoft is making the detachable hard drive a standard feature of the Xbox 360. The notion of the detachable hard drive as an "iPod killer" doesn't appear to be something that has come to fruition, at least not from what's publicly known so far. For portable music, Microsoft has been focusing instead on the ability to plug various devices into the console through the USB ports in the front. Still, the company does say it's possible to rip music tracks to the hard drive, so that might be an area worth watching.

And then there was one of the most mysterious leaks, which came this past March. It was an image of Allard making a presentation in a conference room, with a silver box in front of him that looked like it could be some sort of prototype. (Photo at right from joystiq.) The image was apparently shot surreptitiously with a camera phone. It was dismissed at the time as a decoy, and clearly it was nothing like the Xbox 360 that Microsoft unveiled last week.

But one of the most interesting parts of last week's MTV special was a segment that included a quick series of images showing the evolution of the Xbox 360 design. I slowed it down on playback, just to see the designs more closely. This one, below, was particularly interesting. Look familiar?

Headed to E3 ...

I'll be in Los Angeles at the Electronic Entertainment Expo video-game convention, writing stories for the paper and posting to this weblog. See this morning's preview for more on what to expect this week. As mentioned at the conclusion of the story, Sony has put up billboards in L.A. that appear to signal the imminent unveiling of the PlayStation 3. The tag line: "WELCOME CHANG3"

Tabs coming in IE 7

On the IE Blog, Microsoft's Dean Hachamovitch sums up today's Internet Explorer news succinctly: "Yes, IE7 has tabs." See his post for further details, and see today's Microsoft Notebook for more on the subject.

Xbox 360 roundup

The MTV unveiling of Microsoft's new Xbox 360 wasn't exactly what some might have expected. (Video Game Ombudsman: "The future of gaming is a girl in a blue dress?" via Slashdot.) But the company's second try at the game console business is nevertheless getting lots of attention this morning. See this story and sidebar from today's newspaper for our take. Some of the highlights from elsewhere:

• San Jose Mercury News: "When word surfaced a year ago that Microsoft was building the box on the cheap, game developers rebelled. [Xbox executive J] Allard said the company listened and doubled the amount of main memory and decided to include an expensive hard disk drive after all, though [CEO Steve] Ballmer earlier had objected to its cost."

• New York Times: "Though noticeably smaller than its squat black predecessor, the console houses three 3.2-gigahertz I.B.M. microprocessors that could qualify it as the most powerful home computer on the market."

• Preliminary CNet review: "[Is] the Xbox 360 already obsolete? That's the take you'll likely hear from Sony. The 360 uses the aging DVD format, while Sony's PlayStation 3 employs next-generation Blu-ray discs, which are capable of storing several times more data than standard DVDs and can play back high-definition movies as well."

• Boston Globe: "[Sega executive Scott] Steinberg said that computer games tend to be predictable, because the electronic characters behave in accordance with a ''script" that establishes a limited number of possible actions. But with the Xbox 360, the characters in Condemned can be given artificial intelligence that lets them react to the player's actions. 'What we're doing is creating more behavior characteristics that make the action feel random or more in tune with a real person,' said Steinberg."

• Comments from BBC readers, ranging from, "It'll just be more of the same rubbish," to "This thing will take over the world."

MSFT, P&G and gay rights

The Wall Street Journal's Alan Murray compares Microsoft's predicament on Washington's gay rights legislation to a previous situation encountered by Procter & Gamble. It's one of the newspaper's free online features today. One of the more eye-catching paragraphs includes a comment from Ken Hutcherson, the Redmond pastor who threatened to organize a boycott of Microsoft's products as a result of its stand on the issue:

Would Microsoft be vulnerable to a P&G-style boycott? [The American Family Association's Randy] Sharp and Rev. Hutcherson acknowledge boycotts are hard to pull off successfully. But Rev. Hutcherson, at least, believes the company could be vulnerable, for three reasons. "One, Mac is back," he says, referring to Apple Computer Inc.'s competing computer system. "Two, viruses are killing Microsoft. And three, Linux is making a comeback."

Yahoo's big music move

Things are starting to get interesting in the portable music subscription market. Yahoo's new Music Unlimited offering, announced yesterday, is the third major online music service to use Microsoft's digital-rights management technology to let users transfer music accessed through a monthly subscription to portable devices. But Yahoo is severely undercutting the prices of the existing Napster and RealNetworks services, as the breakdown on this Yahoo page explains.

How seriously does Wall Street take Yahoo's initiative? Shares of RealNetworks are down more than 21 percent and shares of Napster are down more than 31 percent in trading this morning.

See coverage by the Associated Press and CNet News.com, which broke the story ahead of yesterday's announcement.

Gates: Office in 2006

Not that they were well-kept secrets to begin with, but Bill Gates is apparently making a habit of casually disclosing product release schedules during public appearances. A week after letting slip that the next Xbox will ship this year, the Microsoft chairman yesterday confirmed past reports that the next version of Office is scheduled to come out next year. The comment came during his speech at the company's Mobile and Embedded Devices Developer Conference in Las Vegas yesterday:

Things like workflow, rights management, advanced scheduling, easy sharing, business intelligence, those are areas where Office has gotten richer and will in the next big release that's coming sometime next year.

For more on this topic, see coverage by IDG News Service, as well as this Microsoft Watch report last year.

IE and Firefox, the latest

Usage of the Firefox Web browser is approaching 7 percent in the U.S., while usage of Internet Explorer has dropped to less than 89 percent, according to new data released today by Web analytics firm WebSideStory. See the numbers here.

On a related front, Microsoft's Dean Hachamovitch, who leads the company's Internet Explorer team, notes on the IEBlog that he has been getting questions about the recent vulnerabilities discovered in Firefox. He takes the opportunity to comment on the subject of computer security and Microsoft's own situation:

"I think the best place for the facts is with the people responsible for the browser. I say this based on the number of articles I read that misrepresent issues in Windows and IE. I also think that security is an industry-wide problem. It's not limited or unique to operating systems or applications, or client or server software. It's not limited or unique to commercial software or open source."

Revisiting gay rights

Microsoft's announcement Friday that it would support Washington's anti-discrimination legislation isn't the first time that a big reaction has prompted the company's executives to change course on a major gay-rights issue. On his weblog a couple weeks ago, before the latest news was announced, Microsoft Research's Kevin Schofield recounted the employee meeting long ago that led the company to offer benefits to same-sex partners. The whole post is worth reading, but here's the excerpt about that meeting:

I've been working at Microsoft for almost 17 years now. I remember at the Company meeting in either 1988 or 1989, at the customary employee Q&A session at the end of the meeting Jon Shirley [then Microsoft's president] was asked when Microsoft would extend benefits to same-sex partners. Jon quickly dismissed the idea, and was nearly booed off the stage. Within about a week, the company announced that it would start extending benefits to same-sex partners ...

WSJ on console wars

Today's Wall Street Journal previews the coming video-game console battle between Sony, Microsoft and Nintendo: It's Xbox 360 vs. PlayStation 3, And War Is About to Begin.

Awaiting 'Magneto'

CNet News.com previews the expected release of Windows Mobile 2005, code-named "Magneto," the company's latest bid for a broader presence in the market for smart phones and personal digital assistants. Also see this earlier story by the New York Times.

Xbox MTV taping

Microsoft is keeping the wraps on things until next week's Xbox special airs on MTV, but Xbox Live's Major Nelson (a.k.a. Microsoft's Larry Hryb) is promising to pass along a few incidental details from the scene of the taping tonight in Southern California.

Microsoft's Mac upside

The recent increase in Macintosh shipments has focused attention on the newfound potential for Apple to chip away at the dominant position of Windows-based PCs. But buried in Microsoft's most recent quarterly report is a reminder that the Redmond company also benefits from increased Mac sales, albeit in a very small way, relatively speaking. The quarter to which this sentence refers is roughly the same period in which Apple reported a 43 percent increase in Mac shipments:

Revenue from consumer hardware and software, PC games, and TV platforms increased $21 million or 10% compared to fiscal 2004 primarily due to strength in Mac Office.

Games business in flux

Industry transitions to new video-game consoles can be tough, as yesterday's Electronic Arts earnings report (PDF) illustrated. Bloomberg News offered this context for EA's earnings:

This quarter, the company will have a loss and full-year profit will miss analysts' estimates as customers hold off buying games before companies including Sony Corp. unveil updated games consoles. Costs are rising, putting pressure on margins, as Electronic Arts spends more to develop games for use on new platforms such as Microsoft Corp.'s next Xbox.

Microsoft on KUOW

The first half-hour of KUOW's radio program, "The Works," was about Microsoft last night, although I can't vouch for the credibility of the guy being interviewed. Access the streaming audio here. The best line was from John Moe, the program's host: "It's taking longer for Longhorn to come out than the new Guns 'n' Roses album. What's the deal with that?"

Symantec's 'slingshot'

Dow Jones Newswires reports today that security-software company Symantec may have "a slingshot to aim" at Microsoft as the Redmond company prepares to enter the computer anti-virus market. The story examines the issues surrounding a "broad" patent that Symantec has received for virus-scanning technology.

Gates discusses Ch. 9

Our story this morning on Bill Gates' appearance yesterday at the Society of American Business Editors and Writers conference in Seattle included a list of quotes from the Microsoft chairman.

One that didn't fit into the story: While discussing employee weblogs, Gates also talked about Microsoft's Channel 9 site: "A guy just goes around with a digital camera and videos people. … They put that up as a channel and that gets incredible viewership. In fact, sometimes when I do video interviews, I’m talking to an outlet that is well-less-viewed than the video on the Microsoft Web site. I’m always saying, Why doesn’t somebody interview me for that?"

Buffett, Gates on screen

The Wall Street Journal reports (third item) on Berkshire Hathaway's annual movie, which featured characters including new Berkshire board member Bill Gates.

Examining Ken Hutcherson

The P-I's John Iwasaki profiles Ken Hutcherson, the pastor who says his pressure forced Microsoft to change its position on Washington's gay rights legislation to neutral. The story also includes photos of a visit yesterday to Hutcherson's Antioch Bible Church by gay rights activists.

See also this New York Times story on Hutcherson today. And here's Hutcherson's page on the Antioch Bible Church Web site.

Gates in auto country

Mike Wendland of the Detroit Free Press reports on Bill Gates' appearances last week in Michigan, where the Microsoft chairman talked about the company's latest automotive technology. (Also see the sidebar, where Wendland asks Gates about the cars he drive.) The Associated Press had more in this story in Saturday's newspaper.

Security threats diversify

Reuters reports on the latest computer security threat report from the SANS Institute: "While hackers continued to poke new holes in Microsoft Corp.'s popular Windows operating system, they increasingly exploited flaws in software made by other companies as well, the nonprofit SANS Institute found."

Access the SANS report here.