Gates Unwraps Xbox, Previews Whistler

LAS VEGAS, NEVADA -- PC sales may be down, but the game console war is just heating up as Microsoft readies its Xbox for a battle against Sony's Playstation 2.

Microsoft Chair and Chief Software Architect Bill Gates offered the first look at the much-anticipated Xbox game console here at the Consumer Electronics Show. Microsoft's first gaming console is a sleek black box about 8 inches square and 3 inches high, with a large X embossed on the top and a neon green bay at the center into which DVD disks can be inserted. The company showed two shoot-'em-up video games running on a developer version of the Xbox in a demonstration designed to show off the machine's superior graphics performance.

"What you're seeing here is the final Xbox, except for a couple of chips that are so state-of-the-art they won't be done until we finish the manufacturing. We'll just plug those in," Gates said, speaking to a packed theater audience Saturday night. "Everything else will be as you see it."

PC Power Backs X

Gates confirmed that the Xbox, expected to be available this fall, will be powered by an Intel processor and a separate graphics chip being developed by NVidia. It will have four ports for multiplayer gaming, an Ethernet port for playing games over the Web, and a "rumble" capability so that users can feel the action on the screen through the game's controllers, Gates said.

"The graphics capability is over three times greater than what's been available before," Gates claimed. When a disk is inserted into the Xbox it takes only eight seconds for a game to load and start running, he said. Because the Xbox has an 8GB hard drive, games that have been played previously are stored locally and don't have to be reloaded, he added.

Because Xbox runs on a Windows-like platform, Microsoft contends that PC game developers should have an easier time porting games to run on Xbox than to other consoles.

Professional wrestling star The Rock joined Gates on stage to bring some celebrity to the unveiling. Among the games on tap for the Xbox is the World Wrestling Federation's Raw is War.

"To the untrained eye, it might just appear that The Rock and Bill Gates don't have a heck of a lot in common," said The Rock, who likes to refer to himself in the third person, as he momentarily dwarfed Gates on stage.

Pricing hasn't been announced, but Microsoft has said the Xbox will be priced competitively with other machines on the market. Sony's Playstation 2 retails for $299 in the U.S., if you can get your hands on one.

A PC Digital Entertainment Center

Despite Microsoft's move from PC to consumer electronics with the Xbox, Gates stressed that Microsoft still has plenty of plans for the PC and its growing role as a hub for digital entertainment and communications.

"The PC is going to be the place where you store and edit [digital] information, where you communicate it to others. It's the center of control," Gates said, reiterating the convergence theme that is dominating this year's CES.

To demonstrate Microsoft's focus on the PC as a home entertainment and connectivity hub, Gates offered the first public demonstration of Whistler, the code name for the next version of Windows due out later this year.

Whistler dispenses with the old Windows 9x code and is based instead on the same software core or "kernel" as Windows 2000. "By moving Windows 2000 to the [consumer] PC, we create a machine you'll be leaving on 24 hours a day, a machine that can continue to act as a server for the picture frames, the music devices, the peripherals around the house," Gates said.

Whistler also attempts to do away with most of the icons that clutter the desktop screen. Instead, the OS presents users with a simple login screen that allows up to four users to log on and access their own applications and data. A revamped Start menu makes readily available a user's favorite applications and documents.

Pocket PC Talk

Gates also hosted a demonstration of a forthcoming version of Microsoft's Pocket PC platform for PDAs, called Pocket PC Plus. A prototype IPaq PDA from Compaq Computer was shown that included full voice recognition, allowing a user to create e-mail and set up calendar entries using voice commands. Until now, a lack of processing power and memory has made speech recognition hard to achieve effectively on handheld computers.

Using a wireless connection provided by the 802.11b standard, the device was also used to play a video clip and music broadcast from a PC across the stage. Gates didn't say when Pocket PC Plus would be released commercially.

Gates's notion of the PC as a server for multiple devices was emphasized here Friday night by Craig Barrett, Intel's chief executive officer and president. Both executives referred to an "extended PC" era in which they see the PC's value being enhanced by its role as a storage and communications hub for digital cameras, Internet appliances, set-top boxes, and other peripherals around the home and office.

Improvements Needed for Digital Life

Both companies have acknowledged the changing landscape of the PC world by making substantial investments in other products: Intel in networking equipment and digital music players, for example, and Microsoft in its gaming console, WebTV set-top box, and Pocket PC platform.

Gates also showed prototype devices developed by Microsoft to illustrate the kind of world people can expect to live in when wireless networking technologies like 802.11b and Bluetooth become commonplace--and if standards like Microsoft's Universal Plug and Play, which allows multiple devices to be linked easily to a network, catch on. The devices included an alarm clock with an LCD screen and a speaker that was used to play music delivered wirelessly from a PC.

Gates acknowledged that an "immense" amount of work must be done to make the digital lifestyle a reality, including improving ease of use, expanding broadband networks using cable and DSL connections, and educating consumers about the products available and how to use them.

"One of the key elements--and you won't be surprised hearing this from me--is that software is the key," Gates said, referring to the digital experience.

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