SAN JOSE, Calif. - Dec. 7, 1999 - Today at Streaming Media West '99, Microsoft Corp. Chairman and CEO Bill Gates outlined "The Digital Media Revolution," the mainstream use of digital audio and video, as the next major wave of Internet computing. In his keynote address, Gates described the importance of establishing a blend of innovative technologies and industry partnerships to make the digital media revolution a reality in the home, the workplace and everywhere in between.

In separate announcements, Microsoft also unveiled new technologies, relationships and initiatives in the areas of broadband media, consumer electronics, music distribution and services, and solutions for the knowledge worker.

"Digital audio and video are radically changing computing and the Internet for consumers and businesses alike," Gates said. "The digital media revolution offers tremendous opportunities for industry innovation, creates new business models, and dramatically improves the computing and entertainment experience."

Microsoft is driving toward three key initiatives to bring digital media to the mainstream for consumers and corporations. By building on the open Windows Media™ platform, Microsoft and industry partners are delivering the following:

• High-quality technologies and services that will give consumers and businesses the experience they demand
• Infrastructure to enable digital media to be delivered quickly, easily and at lower costs - anywhere and on any device
• Software and services that support expanded and sustainable business models for the digital media industry

High-Quality, High-Speed Content to Consumers

Today Microsoft unveiled significant momentum for the Windows Media Broadband Jumpstart initiative, with immediate availability of high-speed, high-quality content from more than 45 partners. Through the new Windows Media Broadband Guide (http://www.windowsmedia.com/broadband/), Microsoft is providing consumers with unmatched access to some of the best online music videos, movie trailers, full-length feature films, CD-quality Internet radio and more from leading providers such as Sony Music Entertainment's Columbia Records, VH1.com, BBC, Music Choice, FOXSports.com and AtomFilms. The new content providers participating in the Jumpstart initiative join over 1,000 providers of news, sports, entertainment and educational content available through WindowsMedia.com.

This new selection of high-quality Microsoft^® Windows Media audio and video is delivered via broadband-optimized content delivery networks from iBEAM Broadcasting and InterVU Inc. Anyone with a cable modem, DSL connection, high-speed corporate or educational Internet connection can experience these new offerings. The Windows Media Broadband Jumpstart initiative, launched in September, encourages the development, distribution and broad availability of high-quality audio and video on the Internet.

From Home to Work and Everywhere in Between

Whether wired or wireless, in the home or at the gym, portable digital entertainment and content are key to driving the digital revolution forward. Today's announcements demonstrate further expansion into the home and on popular handheld devices:

• First digital cable set-top box with digital video and audio. General Instrument Corp. announced the first-ever television set-top box with Internet streaming audio and video capabilities. Demonstrated for the first time during Gates' keynote address today, the DCT-5000+ runs on the Microsoft Windows^® CE operating system and offers access to the same high-quality streaming audio and video that is available on PCs via Windows Media.
• Connecting the PC to the home entertainment system. Gates demonstrated Sonicbox Inc.'s innovative imBand Remote Tuner, which extends Windows Media jukebox playlists and Internet radio from the PC to provide convenient access from any FM stereo in the home.
• Home movies go digital with Windows Movie Maker. Gates previewed Windows Movie Maker, a new feature of the next consumer release of Microsoft Windows. Windows Movie Maker delivers the ability to turn home movies from any analog or digital video camera or VCR into digital movies that can be stored, edited and shared via the PC and on the Web.
• Major portable device players support Windows Media. Portable device maker THOMSON multimedia S.A. announced that the popular RCA LYRA portable music players will support Windows Media. In addition, Texas Instruments Inc. announced that its programmable digital signal processors, which power leading portable music players and devices, will support Windows Media audio and rights management technologies. These companies, which join Cirrus Logic Corp., Creative Labs Inc., Diamond Multimedia, Sony Corp. and others in their support of Windows Media, are fueling the demand, broad availability and widespread consumer use of portable music players.

Enabling Digital Music Commerce

The open Windows Media platform delivers high-quality digital music and a flexible technology foundation for digital music distribution and commerce. Windows Media has gained widespread support among both major and independent record labels, including Warner Music Group, Sony Music Entertainment, BMG Entertainment, EMI Recorded Music, TVT Records and others. As digital media becomes widely used, new infrastructure services are required to support content management, e-commerce, secure music distribution and more. Today, new Microsoft partners announcing Windows Media support in this area include Supertracks and Preview Systems, who are adding support for Windows Media in their respective end-to-end solutions for retailers for digital download of music. This widespread support from both the music industry and infrastructure providers is key to making the digital music revolution a reality.

Windows Media Sparks Innovation in the Workplace

Digital media use is exploding in companies of all sizes. Windows Media is used today for internal sales force training; business-to-business marketing and e-commerce; and more effective, timely and cost-saving communications. In a separate announcement today, Microsoft and Hewlett-Packard Co. announced that Hewlett-Packard has selected Windows Media streaming technology as the cornerstone for its Enterprise Computing organization's global marketing communications activities. In addition, according to a study by Aberdeen Group, Hewlett-Packard's adoption of Windows Media has realized cost savings of $1.2 million and a return on investment of 1,800 percent -- paying for itself within the first month of operation.