At the Streaming Media West '99 show here, Gates said that such technology was "going to be a mainstream part of the PC and digital device experience." The chairman then outlined Microsoft's response to the slow uptake of the technology.
Streaming media software allows users to access multimedia content such as audio or video without requiring it to be downloaded first. Gates said that 91 percent of Windows 98 SE users were online an average of 40 hours a month, yet only 41 percent used Internet streaming technology.
And while only a small portion of businesses are using streaming technology to replace in-person meetings or conduct training today, the majority will be doing so in the next three years, he said.
Ultimately, Microsoft's role, he said, is to make sure everyone has the enabling software. Gates also noted that there are still issues in building the infrastructure that will deliver content to all the devices, such as portable digital music players and TV set-top boxes from which people will access Internet content.
"Our goal in this is not to be a media company ourselves," or the publisher of information, said Gates, but to provide the infrastructure that lets content companies provide streamed multimedia.
Gates' comments might sound surprising, and even contradictory, in light of his company's commitment to the MSN portal and investment in the MSNBC cable channel, both of which produce and distribute information. But they come as the company seeks to boost the use of its technology while it battles against RealNetworks' software and Apple Computer's QuickTime multimedia streaming technology.
Streaming media technology promises to offer a better experience on the Internet and improve worker productivity, but Microsoft first has to make it easier to use the technology first, Gates admitted. To that end, Microsoft demonstrated an upcoming version of Windows Media Player that allowed users to speed through an event such as a lecture by automatically taking out pauses in a speech and cataloguing changes in the presentation so that users can skip to specific segments of an event.
The new version will also feature a revised graphical interface that looks like a television with a brushed metallic face.
A major trend in the growth of the market for streaming technologies will be the proliferation of non-PC devices from which to access content. Gates demonstrated for the first time how a cable set-top box from General Instrument would use Windows software to play back an Internet-based news broadcast. The implication, Gates said, was that viewers will have increased power to view what they want, when they want it--not to mention an almost unlimited amount of content.
Gates also demonstrated for the first time how the upcoming version of Windows for consumers will have software that will make video editing easier. The software automatically takes video and automatically separates it into segments for editing based on pauses on the tape and scene changes. Users can drag and drop scenes they want onto a "storyboard" representing the final edited version that can be sent over the Internet, representatives said.
Meanwhile, RealNetworks may be feeling a little like Netscape Communications did about three years ago.
The leader in the market for streaming audio and video content over the Internet, Real has an early advantage over Microsoft, which began offering its Windows Media Player in response to the success of RealNetworks' RealPlayer, RealJukebox and G2 software.
But Microsoft, in much the same way the software giant quickly caught Netscape's initial lead in the Web browser market, has overtly pushed its streaming media software in a come-from-behind effort. Earlier today, Microsoft said 45 companies have picked Windows Media Player as their streaming media software of choice and have joined Microsoft's Windows Media Broadband Jumpstart Initiative, a coalition of companies that support the software.
The announcements show an increasing number of content providers choosing Microsoft's technology over the leading Web streaming provider, RealNetworks.
Throwing its support behind Media Player, Hewlett-Packard said it will use the technology in its enterprise and commercial marketing communications between employees and partners, such as product launches and sales force training.
Texas Instruments said its next version of programmable digital signal processors (DSPs) will support the streaming software. DSPs are used in portable Internet audio devices.
Another new supporter, General Instrument, said it will integrate Media Player in its set-top terminal, DCT 5000, for streaming Internet audio and video over cable networks. General Instrument is a provider of broadband access technology that integrates Internet and cable content.
In addition, Microsoft launched WindowsMedia.com Broadband Guide, a Web site that offers access to news, sports and entertainment broadband content. The site also includes a referral service that directs non-broadband subscribers to broadband connection providers.
Microsoft's efforts likely preface a spirited showdown with RealNetworks.
Last year, RealNetworks chief executive Rob Glaser testified before the U.S. Senate that Windows Media Player "breaks" his company's software when the two are installed on the same personal computer. The accusations sparked weeks of verbal sparring between the companies.
Regardless, RealNetworks chief operating officer Thomas Frank will have The final word in this round in an upcoming speech Thursday. Frank will present the closing keynote at the three-day conference streaming media conference.
News.com's Erich Luening reported from Boston, and Jim Davis reported from San Jose, Calif. Corey Grice also contributed to this report from San Francisco.