MBN: THE MONTE BUBBLES NETWORK

CEA FORECASTS CONSUMER ELECTRONICS REVENUE WILL SURPASS $155 BILLION IN 2007

Year-End 2006 Revenue at $145 Billion



Factory-to-dealer sales of consumer electronics are projected to exceed $155 billion in 2007, or seven percent growth, according to the semi-annual industry forecast released today by the Consumer Electronics Association (CEA^®). The forecast comes on the eve of the 2007 International CES^®, the world's largest consumer technology tradeshow.

"The consumer electronics (CE) industry has outdone itself once again, with revenues totaling $145 billion in 2006, and we're on track for another year of healthy growth," said CEA President and CEO Gary Shapiro. "We surpassed original projections for the second year in a row, and the industry outlook is proof positive that Americans can't do without their beloved consumer electronics. Consumers are benefiting from our industry's innovations and only want to see more of them. I am excited to be witnessing this innovation first-hand on the show floor at the International CES."

Todd Thibodeaux, CEA's senior vice president of industry relations, acknowledged 2006 industry growth far exceeded CEA's conservative forecast at the beginning of the year. "We originally forecast eight percent growth, but when all was said and done, we saw an impressive 13 percent growth for the year. Consumers started the year investing in innovative consumer electronics products and seemingly never stopped. With the 2007 forecast, we see the consumer love affair with technology continuing at a healthy clip."

Thibodeaux said the display category will continue to fuel industry growth in 2007. "The TV market is setting all-time revenue records. CRT-based sets are giving way to flat panel displays. The successful ongoing transition to digital television is driving demand in this market space."

CEA projects that display technologies will continue to be the star category in the industry and account for $26 billion in revenues for 2007. All television sets manufactured today with an analog tuner must also contain a digital tuner, which is largely responsible for the vast increase in digital television sales. Unprecedented price declines in plasma and LCD displays are also contributing to growth. For 2007, these flat panel displays are expected to ship a combined 19 million units.

Next-generation consoles will make the video game market one to watch in 2007. An analysis of year-end game console sales reports for 2006 indicates that holiday sales will lift revenues in 2007 to $16 billion, a 23 percent increase.

MP3 players continue to drive the audio market. CEA projects that MP3 players will account for 90 percent of the $6 billion in revenues for the portable entertainment market. Thirty-four million MP3 players shipped in 2006 and an additional 41 million are expected to ship in 2007.

"One of the biggest drivers of both the audio and portable entertainment markets is the MP3 player. It continues to ship at large volumes and 2007 will be no different as the market shifts into a replacement mode. For example, many consumers will be replacing their first generation players with new players offering video playback capability," said Thibodeaux.

Driving the mobile electronics market are portable navigation and GPS devices, evidence that consumers are continually looking for products that will keep them safe and make their automotive travel easier. Two million units shipped in 2006, a 66 percent increase over 2005, and 2007 shipment volumes will continue to propel the market with three million units projected to be shipped, generating $1 billion in revenues.

Other product categories that will see substantial growth in 2007 are PCs, accessories and digital imaging devices. In 2006, shipment volumes of laptops eclipsed their desktop counterparts. CE accessory sales also will grow in 2007, to the tune of $11 billion, in large part due to an overall consumer emphasis on portability. Total digital imaging shipments are expected to exceed 32 million units, with revenues projected to reach $8 billion, making 2006 and 2007 the best revenue years for this category.

"U.S. Consumer Electronics Sales and Forecasts 2002-2007" (January 2007) is published twice per year, in January and July. It was designed and formulated by CEA Market Research, the most comprehensive source of sales data, forecasts, consumer research and historical trends for the consumer electronics industry. Please cite any information to the Consumer Electronics Association (CEA^®). The complete report is available free to CEA member companies. Non-members may purchase the study for $499 at http://www.ebrain.org.

ABOUT CEA:
The Consumer Electronics Association (CEA) is the preeminent trade association promoting growth in the consumer technology industry through technology policy, events, research, promotion and the fostering of business and strategic relationships. CEA represents more than 2,100 corporate members involved in the design, development, manufacturing, distribution and integration of audio, video, mobile electronics, wireless and landline communications, information technology, digital imaging, home networking, multimedia and accessory products, as well as related services that are sold through consumer channels. Combined, CEA's members account for more than $140 billion in annual sales. CEA's resources are available online at www.CE.org, the definitive source for information about the consumer electronics industry. CEA also sponsors and manages the International CES - Defining Tomorrow's Technology. All profits from CES are reinvested into industry services, including technical training and education, industry promotion, engineering standards development, market research and legislative advocacy.

NEW CONVERGENCE OF CE PRODUCTS WITH CONTENT AND DYNAMIC KEYNOTE ADDRESSES HIGHLIGHT DAY ONE OF THE 2007 INTERNATIONAL CES

Motorola, Disney, Nokia and Pipelines Executives Launch 40th Anniversary of CES



The 2007 International CES^® opened its doors yesterday to the largest display of cutting-edge products in consumer technology, powerful industry keynote addresses and trend-setting conference sessions. With a record-setting 1.8 million net square feet of space and 2,700 exhibitors, the 2007 International CES, the world's largest technology tradeshow runs through January 11 and celebrates the show's 40^th anniversary.

Gary Shapiro, president and CEO of CEA, the producer of the International CES, kicked off the 2007 show Monday morning with his "State of the Industry Address." He spoke about the "new convergence" taking place in the CE industry and forecast that the CE industry will soar to $155 billion in 2007. Shapiro cautioned against putting limits on innovation and technology and urged attendees to support Digital Freedom, a grassroots coalition designed to protect the rights of artists, consumers and innovators to use digital technology and lawfully required content. Shapiro highlighted the coalition's presence at CES, in the Las Vegas Convention Center (LVCC) lobby, and on the web at digitalfreedom.org.

Directly following Shapiro's address, Ed Zander, president and CEO of Motorola, delivered the opening day keynote. The theme was seamless mobility using the Internet as Zander rode onstage on a bike that can power a cell phone. Zander stated that people around the world are getting connected with 25 million mobile phones sold each second. To do its part, Motorola is focusing on connecting the unconnected in emerging markets with its inexpensive Motofone.

"Everything is becoming digital and everything with a digital heartbeat will get connected," he said. The company is focusing on cool mobile devices and creating cool experiences for users, enterprise mobility and the home to go. Zander announced new partnerships and performed ground-breaking demonstrations with Yahoo!, called Y! Go, Kodak, the Razr Z6 and the "Moto Follow Me TV" that sends live video streams to a mobile handset through an IP set-top box. Zander said, "It truly is the Internet in your pocket," and concluded, "The home is the hub of seamless mobility."

Monday's second keynote featured Robert Iger, president and CEO of the Walt Disney Company. With a "Monday Night Keynote" theme, Iger explained how Disney's tremendous success has come from the timelessness of great characters and storylines, along with cutting-edge technologies. Iger stated that no company currently delivers more content in more ways to more people than the Walt Disney Company, and introduced several friends to help demonstrate the wealth of content Disney currently produces and distributes.

First, from the ABC network, stars from the award winning series "LOST," Matthew Fox and Evangeline Lilly, talked about the multi-platform experience now providing fans more interaction with the program. Mike Tirico, lead announcer of "Monday Night Football" joined Iger on stage to explain the demand from ESPN fans to be plugged into instant information and live coverage from anywhere and at anytime. Currently, fans in 102 countries can watch ESPN live.

Iger's biggest announcements of the evening included the launch of the redesigned, interactive and "extreme digital" Disney.com website and the confirmation of "Pirates of the Caribbean III, At the World's End." Jerry Bruckheimer, renowned Hollywood producer, joined Iger on stage to show a teaser for Pirates III and announced that Keith Richards will be making a cameo in the film. Iger concluded with his promise to continue to provide cutting-edge creative content for innovative new CE products.

Monday also launched the CES Industry Insider Series with an address from Nokia president and CEO, Olli-Pekka Kallasvuo, and a Pipelines Power Panel focused on the various platforms for delivery of content.

Kallasvuo's presentation focused on mobility, Internet, communities and convenience. He stated that Nokia's newest products would provide great features and richer experiences, particularly in the new models of digital cameras and wireless phones, the latter of which will include real-time navigation and search capabilities.

The Pipelines Power Panel, moderated by CEA's Shapiro, debated the state of content delivery and the importance of HDTV to both the stakeholders and their consumers. The panel featured heavy hitters from leading broadcast, cable, satellite and telecommunications companies including Chase Carey, president and CEO, DIRECTV, Inc.; Charles W. Ergen, chairman and CEO, Echostar Communications Corporation; Virginia Ruesterholz, president, Verizon Telecom; Glenn A. Britt, president and CEO, Time Warner Cable; David J. Barrett, president and CEO, Hearst-Argyle Television, Inc. and Patrick J. Esser, president, Cox Communications, Inc. The Pipelines panelists discussed competitive differentiators and services that cut across multiple delivery platforms.

Also on Monday, CES celebrated its 40^th anniversary with a bash on the ESPN/CEA Stage in the LVCC Grand Lobby. Gary Shapiro was joined on stage by Jack Wayman, the "Father of CES," along with Rossi Ralenkotter, president and CEO of the Las Vegas Convention and Visitors Authority and Dan Cole, CEA's vice president of Business Development, to honor the four decades of the International CES and the 2007 exhibitors that also exhibited at the first show in 1967.

The extensive lineup of CES conference sessions launched on Monday with the first International CES SuperSession of 2007, "Understanding Consumer Digital Ecosystems" which focused on convergence and interoperability. SuperSession panelists included Tim Bajarin, president, Creative Strategies Inc.; Satjiv Chahil, senior vice president, Global Marketing, HP; Dr. Levy Gerzberg, president and CEO, Zoran Corporation; David Jaworski, CEO, Pass Along Networks; Eric Kim, senior vice president and general manager, Digital Home Group , Intel; Frans van Houten, CEO, NXP Semiconductors. The panelists agreed that consumers are increasingly seeking devices that work together to create a digital ecosystem of CE products. Bajarin stated that the digital ecosystems of today include the cell phone, personal computer and TV and concluded that the future of these ecosystems would broaden to further devices, leaving no product a stand alone island.

In Monday's session, "Congress Talks Tech," Jon Healy, editorial writer for the Los Angeles Times, moderated a discussion among Congressmen Tom Davis (R-VA), Darrell Issa (R-CA) and Jon Porter (R-NV). The conversation opened with a welcome from Congressman Porter, Las Vegas' congressional representative, and focused on several key issues that will be addressed in the 107^th Congress including Internet gaming, government and security, copyright and technology, patent reform, net neutrality and the travel ban. Regarding the travel ban, Congressman Davis categorized it is "throwing the baby out with the bath water." All the panelists agreed the ban cuts off an important line of communication and understanding for members and their staff.

The home health technology SuperSession, "The Future of Consumer Electronics: Convergence With Home Health," provided a sneak preview of the potential that consumer electronics could bring to the health care industry. Charles S. Golvin, principal analyst at Forrester Research, moderated a lively discussion on the future relationship between home heath care and consumer technology with panelists Doug Busch, CTO, Digital Health Group, Intel Corporation; Gary Feather, director, Digital AV Systems, Sharp Laboratories of America; William Lalinde, M.B.A., H.S.A., business manager, MOTOHEALTH, iDEN Sector, Global Mobile Devices Business, Motorola, Inc.; Jeff Perry, business manager, ConnectedCare - Motiva, Philips Consumer Healthcare Solutions and Dave Watson, CIO, Kaiser Permanente. The panelists discussed a growing transformation of the healthcare industry, stemming from consumer technology including powerful personal telemedicine tools, such as home-based, tele-monitoring products for patients.

A standing-room only crowd attended Monday's final SuperSession, "CNET's Next Big Thing," moderated by CNET.com, editor-at-large, Brian Cooley. Cooley was joined by CNET colleagues Tom Merritt and Molly Wood, as well as a consumer representative, Nate Lanxon, who won a CNET Backstage Crew trip to the International CES. The session featured panel discussions, video presentations and audience polling surrounding three key themes: mobile video content, Internet downloaded or streamed content and digital rights management (DRM).

Commercial video content, delivered to a variety of portable products such as mobile phones, MP3 players and game players, was characterized as a disruptive technology as it is challenging established business models. An audience poll revealed that news clips and sports highlights would most intrigue consumers, but full-length TV programming and specialized content were suggested as adoption drivers by industry experts in a video presentation and panel discussion.

Panelists agreed bandwidth limitations would hamper Internet downloading of content in the near-term, but disagreed as to whether or not it would ever completely replace physical media. Some argued consumers hold dear the collectible aspect of physical media while others suggested that it could become a specialty industry in a networked content world. The audience was split with 44 percent saying DVD will give way to Internet video sooner than later and 56 percent disagreeing.

Two additional panelists joined the stage for the final theme of digital rights management - CEA Senior Vice President of Government Affairs Michael Petricone and Motion Picture Association of America (MPAA) Executive Vice President and Special Policy Advisor Fritz Attaway. Arguing in favor of some sort of DRM technology going forward, Attaway said people "need to be reminded of the deal they made." Lanxon retorted that DRM is so easily undermined that it is ineffective, and seeing a friend hauled off to prison for illegally using content would be reminder enough to most consumers. He added he would be happy to pay twice as much for content if he were allowed to enjoy it on his CE products when, where and how he wanted. Petricone noted the industry is so concerned about onerous limitations on consumers and technology that it is significantly rallying around the new Digital Freedom campaign.

For more news on the 2007 International CES, including keynote transcripts and photos, visit www.CESweb.org, the interactive source for CES information.

ABOUT CEA:
The Consumer Electronics Association (CEA) is the preeminent trade association promoting growth in the consumer technology industry through technology policy, events, research, promotion and the fostering of business and strategic relationships. CEA represents more than 2,100 corporate members involved in the design, development, manufacturing, distribution and integration of audio, video, mobile electronics, wireless and landline communications, information technology, digital imaging, home networking, multimedia and accessory products, as well as related services that are sold through consumer channels. Combined, CEA's members account for more than $140 billion in annual sales. CEA's resources are available online at www.CE.org, the definitive source for information about the consumer electronics industry. CEA also sponsors and manages the International CES - Defining Tomorrow's Technology. All profits from CES are reinvested into industry services, including technical training and education, industry promotion, engineering standards development, market research and legislative advocacy.

CONNECTED CONSUMER EXPERIENCE AND CONTENT PARTNERSHIPS HOT TOPICS FOR DAY TWO AT THE 2007 INTERNATIONAL CES

Dell and CBS Keynotes and Cisco Industry Insider Focus on the Future of Consumer Technology


The connected consumer experience and partnerships in the content community were the hot topics on the second day of the 2007 International CES®. Industry pioneers from Dell, CBS and Cisco delivered addresses on day two, sharing their visions for the future of consumer technology and its unique relationship with the content community. Produced by the Consumer Electronics Association (CEA^®), the 2007 International CES, the world’s largest technology tradeshow runs through tomorrow and celebrates the show’s 40th anniversary.

Tuesday’s morning keynote, presented by Michael Dell, founder and chairman, Dell, Inc., was chock-full of announcements related to new hardware, customer programs and a landmark environmental program. Joined by Paul DiMeo, a regular designer on “Extreme Makeover: Home Edition,” Dell highlighted the company’s community outreach via the popular ABC series and announced its first home entertainment suite, which will feature the industry’s first high-definition television  (HDTV) tuner. 

Joined by a “Dr. Evil” look-alike, Dell announced a new service called DataSafe, allowing users to back up files online with a password protected program and have their data pushed to a new system. Additionally, in keeping with Dell’s ever-expanding focus on gaming, Dell announced its new XPS 710 computer system, which utilizes liquid and ceramics and optimizes heavy gaming.

Dell’s keynote concluded with the unveiling of a new environmental program, “Plant a Tree for Me.” The new program, which will allow Dell’s customers to donate $2 for each notebook computer and $6 for each desktop PC they buy, will benefit the Conservation Fund and the Carbonfund, two nonprofit groups that promote ways to reduce or offset carbon emissions. “I challenge every PC vendor in the industry to join us in providing free recycling,” said Dell.

Leslie Moonves, president and CEO of CBS Corporation, captured a large audience with a keynote address focused on the future and growth of the content industry. Moonves shared the stage with a wide range of stars and talent from the interactive content community and CBS Corporation. Joining Moonves were Anthony Zuiker, creator of “CSI: CRIME SCENE INVESTIGATION;” College Sports Television Founder and President Brian Bedol; the hosts of the “Opie and Anthony” radio show and Ilene Chaikin and Jennifer Beals, creator and star, respectively, of Showtime’s, “The L Word.”

During his address Moonves declared that there is no new media or old media, just media. To address the shift in the way media is consumed, Moonves announced many key partnerships with other leading members of the content community. Joining him on stage during these announcements were Linden Lab Founder and CEO Philip Rosedale, who showcased the virtual world, “Second Life;” Sling Media Co-Founder and CEO Blake Krikorian, who introduced a new service offered by CBS and Sling Media called, “Clip and Sling,” and Chad Hurley, Co-Founder and CEO of YouTube. Moonves concluded by saying that audiences and the content community now realize anything is possible in the digital realm.

Cisco Systems Chairman and CEO John Chambers delivered an Industry Insider address to a crowded Hilton Theater audience about "The Human Network."  Identified as one of the top four focal points for the company in the next decade, the human network or connected consumer experience requires complex technology and a simple user experience, Chambers said. The human network - the convergence of all forms of human expression - is safe, open, simple and virtualized. 

Chambers walked the audience through several demonstrations of the human network throughout his presentation, which included devices that self-install and register, RFID technology allowing consumers to purchase sports tickets on their TV and have them delivered to their cell phone, and live TV chats with friends. Cisco is uniquely capable of providing the human network, Chambers said, because it has a broad technology base, convergence expertise, strong partnerships and is device neutral, content agnostic, standards based and customer focused. 

For information on the day two conference sessions and panels, visit the CES blog at CES.blogs.com.
For more information on the 2007 International CES, including keynote transcripts, photos and a complete list of conference sessions, visit www.CESweb.org, the interactive source for all CES information.

About CEA:
The Consumer Electronics Association (CEA) is the preeminent trade association promoting growth in the consumer technology industry through technology policy, events, research, promotion and the fostering of business and strategic relationships.  CEA represents more than 2,100 corporate members involved in the design, development, manufacturing, distribution and integration of audio, video, mobile electronics, wireless and landline communications, information technology, digital imaging, home networking, multimedia and accessory products, as well as related services that are sold through consumer channels. Combined, CEA's members account for more than $140 billion in annual sales.  CEA's resources are available online at www.CE.org, the definitive source for information about the consumer electronics industry.
CEA also sponsors and manages the International CES – Defining Tomorrow’s Technology.  All profits from CES are reinvested into industry services, including technical training and education, industry promotion, engineering standards development, market research and legislative advocacy.

CEA LAUNCHES CONSUMER EDUCATION INITIATIVE AND SETS THE RECORD STRAIGHT REGARDING CE ENERGY CONSUMPTION

Las Vegas, Nev., January 10, 2007 – The 2007 International CES® Environmental Awareness Day was the largest in show history.  With a focus on the key industry issues of consumer education, electronics recycling and energy efficiency of electronics, Green Wednesday featured the launch of myGreenElectronics.org – a resource guide from the Consumer Electronics Association (CEA®) – as well as a preview of a landmark study on the energy consumption of consumer electronics (CE) products. 

The day began with a kick-off event sponsored by CEA, the Environmental Protection Agency (EPA) and Verdant magazine.  Attendees heard from environmental policy leaders who shared a glimpse of the new myGreenElectronics.org and data regarding recycling resources.  Additionally, table top displays from the event’s corporate and non-profit partners included Computer Recycling for Education, Dell, Ecosol Solar Technologies, Hewlett-Packard, Intel, Jimi Products, NEC, Panasonic, Sharp and Xantrex Technologies.

The Consumer Electronics Association (CEA) is the preeminent trade association promoting growth in the consumer technology industry through technology policy, events, research, promotion and the fostering of business and strategic relationships.  CEA represents more than 2,100 corporate members involved in the design, development, manufacturing, distribution and integration of audio, video, mobile electronics, wireless and landline communications, information technology, digital imaging, home networking, multimedia and accessory products, as well as related services that are sold through consumer channels. Combined, CEA's members account for more than $140 billion in annual sales.  CEA's resources are available online at www.CE.org, the definitive source for information about the consumer electronics industry.

CEA also sponsors and manages the International CES – Defining Tomorrow’s Technology.  All profits from CES are reinvested into industry services, including technical training and education, industry promotion, engineering standards development, market research and legislative advocacy.

2007 INTERNATIONAL CES DEFINED BY NEW CONVERGENCE OF BROADBAND, CONTENT AND CONSUMER ELECTRONICS

World's Largest Technology Tradeshow Attracts Record International Attendance and Garners Ground-Breaking Partnerships Between the CE and Content Industries

Las Vegas, Nevada - 1/11/2007

With 1.8 million net square feet of exhibit space - the largest show floor in its history - and over 140,000 attendees from across the globe experiencing the latest consumer technology products from 2,700 exhibitors, the 2007 International CES reinforced its status as the world's largest consumer technology tradeshow. Produced by the Consumer Electronics Association (CEA^®) and celebrating its 40^th anniversary, the 2007 International CES ran January 8-11 in Las Vegas, Nevada.

"The 2007 International CES succeeded beyond our expectations," said Gary Shapiro, president and CEO of CEA. "It had buzz and optimism and attracted the world leaders of the content, technology and services, communications and automobile industries."

The CES show floor buzzed with more than 20,000 exciting product launches and major partnership announcements, spanning across industries and connecting consumers with more features, services and control of the content incorporated into electronic devices. A new convergence of CE devices emerged on the show floor, combining existing product categories with new digital content and services to create unique, multi-functional products.

"We had a record-breaking show with 2,700 exhibitors filling more than 1.8 million net square feet of show space," said Karen Chupka, senior vice president of events and conferences at CEA. "The shift of our high-performance audio and home theater exhibitors to the Venetian, the 23 Tech Zones and the focus on qualified trade attendees combined to produce what many called the best ever International CES. We also set a record with international attendance of over 26,000."

With high-definition television (HDTV) taking the industry by storm, a surge of display technologies debuted on the show floor, with record-breaking sizes and even greater resolution. Other technologies exploding on the show floor included the hottest products in digital imaging, robotics, in-vehicle entertainment, content-shifting devices and gaming. Additionally, the latest advancements in high-performance audio and home theater were on display at CES' newest venue for 2007, the Sands Expo and Convention Center/The Venetian.

In addition to the world's largest display of consumer electronics, the 2007 International CES also featured a distinguished lineup of industry speakers. Featured CES keynoters included Microsoft's Bill Gates, Motorola's Ed Zander, Disney's Robert Iger, Dell's Michael Dell and CBS' Leslie Moonves. The CES Industry Insider Series, with a new home at the Las Vegas Hilton Theater, featured industry heavy-weights including Nokia's Olli-Pekka Kallasvuo and Cisco's John Chambers, as well as leading executives from major broadband, cable, satellite and telecommunications companies, and FCC Chairman Kevin Martin.

The International CES independently audits attendance and a final attendance number should be available by April. For more information on the 2007 International CES, including keynote transcripts, photos and a complete list of conference sessions, visit www.CESweb.org, the interactive source for all CES information.

The 2008 International CES is scheduled for January 7-10, in Las Vegas, Nevada.

ABOUT CEA:
The Consumer Electronics Association (CEA) is the preeminent trade association promoting growth in the consumer technology industry through technology policy, events, research, promotion and the fostering of business and strategic relationships. CEA represents more than 2,100 corporate members involved in the design, development, manufacturing, distribution and integration of audio, video, mobile electronics, wireless and landline communications, information technology, digital imaging, home networking, multimedia and accessory products, as well as related services that are sold through consumer channels. Combined, CEA's members account for more than $140 billion in annual sales. CEA's resources are available online at www.CE.org, the definitive source for information about the consumer electronics industry. CEA also sponsors and manages the International CES - Defining Tomorrow's Technology. All profits from CES are reinvested into industry services, including technical training and education, industry promotion, engineering standards development, market research and legislative advocacy.

 DTV TRANSITION AND NEW CAR TECHNOLOGIES HIGHLIGHTED ON DAY THREE AT THE 2007 INTERNATIONAL CES

FCC Chairman Martin and CEA's Shapiro Discuss DTV Transition and Broadband Technology; Hot Products Honored at Last Gadget Standing Supersession

Las Vegas, Nevada - 1/11/2007

The digital television (DTV) transition, the growing relationship between the automotive and consumer electronics industries and electronics recycling were the hot topics on the third day of the 2007 International CES^®. Produced by the Consumer Electronics Association (CEA^®), the 2007 International CES, the world's largest consumer technology tradeshow, runs through today and celebrates its 40^th anniversary.

Wednesday's Industry Insider Series featured Federal Communications Commission (FCC) Chairman Kevin Martin, who joined CEA President and CEO Gary Shapiro for a one-on-one conversation about the digital television transition, cable compatibility, net neutrality and other issues critical to the consumer electronics industry. Chairman Martin noted that the significant increase in broadband use has been one of the things he's been most proud of in his term.

"The goal is that everyone has access to broadband," said Martin. "It impacts the way that we get entertainment, seek healthcare and receive education. Trying to put in place a regulatory environment that allows operators to invest in broadband technology is critical for consumers to be able to take advantage of the technologies we see on the show floor."

The morning SuperSession, "Connect2Car: The Automobile's Convergence with Consumer Electronics," moderated by Chris Cook of AAMP of America, included a panel of leading experts from both the consumer electronics industry and the automotive industry. The panelists included Rich Chutorash, director electronics new product, Johnson Controls Inc.; Wieland Holfelder, vice president and chief technology officer, DaimlerChrysler Research, Engineering and Design North America Inc.; Keith Lehmann, senior vice president - Consumer Electronics, Kenwood USA Corporation; Timothy Nixon, manager, Advanced Technology Development, Ford Motor Company and Stephen Witt, vice president, Brand Marketing, Alpine Electronics.

The panels discussed several current roadblocks to better integration of cutting-edge CE products into personal vehicles. The roadblocks included the moving target of consumer demand, the issue of differing standards between CE and automobiles and the varying product cycles of the two industries. The panelist concluded by proposing ideas for better integration. The ideas ranged from the announcement of Ford's new "Sync" platform to an optical interface. Witt explained the next phase must focus on four key factors: convergence of the car and home, driver convenience, ease of use and user content management. He concluded by stating, "Never before have the points of view of these two industries been as similar as they are today."

Jason Linnell, executive director, National Center for Electronics Recycling, moderated a panel discussion regarding the public's knowledge of, and participation in, electronics recycling. Other speakers at the "Federal and State Policy Developments in Electronics Recycling" panel included: Walter Alcorn, environmental consultant, Alcorn Consulting; Shawn DuBravac, economist, CEA; Jay Illingworth, vice president, Electronics Product Stewardship Canada; Verena Radulovic, Product Stewardship, U.S. Environmental Protection Agency (EPA), Office of Solid Waste; and Peter Robertson, partner, Pillsbury Winthrop Shaw Pittman, LLP.

DuBravac presented the results of a CEA consumer survey, which found that 76 percent of consumers are unaware of their local electronics recycling options. Of that 76 percent, 71 percent said they would recycle if they only knew where to do so. DuBravac referred attendees to CEA's new consumer website, myGreenElectronics.org, which will provide consumers with local e-waste recycling information, the latest environmental tips and an ever expanding searchable database of green products.

Panelists also discussed the state of e-cycling in the United States and recommended a national e-cycling initiative that would nationalize a uniform set of standards rather than create 50 different jurisdictions for handling e-waste. Alcorn presented data from the National Center for Electronics Recycling's (NCER) Patchwork Study, which found that the state patchwork of e-cycling regulations amount to $25 million in costs that would be avoided with a national program. Peter Robertson remarked that the timing for such a plan may be ideal because, "a Democratic Congress is simply more amenable to a national e-cycling initiative than a Republican one."

In Wednesday's standing-room only Last Gadget Standing SuperSession, 10 finalists competed head-to-head for product votes and laughs from the crowd. Hosts Robin Raskin, from "The Boomer" and advisors from Yahoo!Tech, moderated the session. Finalists included the V-Click cell phone from D-link, HP TouchSmart PC, RoboSapien's RS media robot, Nokia n95, Data Drive Thru's Tornado data port, Archosa Wireless Portable Media player with touch screen, a Salton coffee maker with weather information, Great Call Jitterbug, Pure Digital Point and Shoot Camcorder and Samsung Ultra Music Phone.

Each product was allotted a four minute demo and at the end, the audience voted online at tech.yahoo.com and by applause. The online winner was the HP TouchSmart PC. The Data Drive Thru Tornado data port won the audience applause portion.

For information on the day three conference sessions and panels, visit the CES blog at CES.blogs.com.

For more information on the 2007 International CES, including keynote transcripts, photos and a complete list of conference sessions, visit www.CESweb.org, the interactive source for all CES information.

ABOUT CEA:
The Consumer Electronics Association (CEA) is the preeminent trade association promoting growth in the consumer technology industry through technology policy, events, research, promotion and the fostering of business and strategic relationships. CEA represents more than 2,100 corporate members involved in the design, development, manufacturing, distribution and integration of audio, video, mobile electronics, wireless and landline communications, information technology, digital imaging, home networking, multimedia and accessory products, as well as related services that are sold through consumer channels. Combined, CEA's members account for more than $140 billion in annual sales. CEA's resources are available online at www.CE.org, the definitive source for information about the consumer electronics industry. CEA also sponsors and manages the International CES - Defining Tomorrow's Technology. All profits from CES are reinvested into industry services, including technical training and education, industry promotion, engineering standards development, market research and legislative advocacy.

CBS Corporation President and CEO Leslie Moonves Shares the Stage With Stars of the Interactive World at the 2007 International Consumer Electronics Show

CBS Embraces Partnerships to Navigate its Interactive Future

Moonves Declares: "There's no such thing as old or new media anymore. There is just media."

Speech States that CBS's Goal is to Evolve from a One-Way Content and Distribution Company to an Interactive Audience Company Focused on Content Communities

Consumer Electronic Show (CES) -- Leslie Moonves, President and Chief Executive Officer of CBS Corporation (NYSE:CBS) (NYSE:and) (NYSE:CBS.A) , gave the keynote address at the 40th Annual International Consumer Electronics Show in Las Vegas today, sharing the stage with a wide range of stars from the interactive community. Joining Moonves were talent from within the CBS Corporation, followed by several partners and associates that CBS is working with in the digital space.

"There's no such thing as old or new media anymore. We're just media," Moonves said. "Whether 'programming' means CSI or C++, we're all playing on the same big digital field." In his remarks, Moonves emphasized CBS's multi-faceted approach to embracing the digital opportunity. "In some cases, we're developing our ideas entirely in house. And in other cases we're forming partnerships to bring ideas to life," he said.

Moonves cited a recent CBS report that showed 53% of fans who watched a TV show online turned around and watched the show on the network. "The more the public becomes connected to digital media, the more engaged they become with the content, and with each other." Introducing those from within the CBS Corporation, Moonves said, "These individuals represent all kinds of perspectives and expertise, and are some of CBS's most visionary intrapraneurs."

  Featured were:    * Anthony Zuiker, Creator of CSI: CRIME SCENE INVESTIGATION, the world's     largest television franchise. Zuiker described the transformation of his     initial idea into the multi-platform global hit that it is today,     stressing how audience participation has added to the show's success.    * College Sports Television Founder and President Brian Bedol. Bedol     showcased CSTV's sports community platform FansOnly, which allows     friends to create their own viewing groups in a virtual Skybox.    * Radio personalities Gregg Hughes and Anthony Cumia, hosts of THE OPIE &     ANTHONY SHOW. Hughes and Cumia explained how online video is turning the     entire world into a virtual studio by inviting listeners to participate     in real-time and by allowing them to stay with the show even when it's     not on the airwaves.    * Ilene Chaikin and Jennifer Beals, creator and star of Showtime's THE L     WORD. Chaikin and Beals provided a demonstration of OurChart.com, a new     social networking web site for the lesbian community inspired by the     show.  

Moonves then invited several companies that CBS is working with to share the stage. Highlighting the pivotal role of collaboration in shaping the future of content, Moonves said, "These companies are helping us extend the digital and interactive reach of our world class assets, and to build deeper connections with our audiences." Featured were:

  * Linden Lab Founder and CEO, Philip Rosedale. Rosedale showcased the     online virtual world Second Life, where users can create and shape their     content experience each time they enter the space. Rosedale also showed     a machimina, produced by Electric Sheep, featuring two impassioned Star     Trek fans. Following Rosedale's remarks, Moonves announced that CBS will     be partnering with Electric Sheep to build a Star Trek environment     within Second Life.    * Sling Media Co-Founder and CEO Blake Krikorian.  Krikorian introduced a     new application and service from Sling Media called Clip+Sling. Together     with CBS, Sling Media is beta testing a new technology designed to help     audiences share short segments of programming. See related release:     "Sling Media and CBS Announce Beta Test Of New Delivery System for     Video."    * Chad Hurley, Co-Founder and CEO of YouTube. Hurley talked about the     success of CBS Corporation content on YouTube, and highlighted a contest     that gives YouTube users a chance to have their 15-second personal     message broadcast during CBS Sports Coverage of Super Bowl XLI on     Sunday, Feb. 4, 2007.  "Seeing YouTube evolve into a centerpiece of     CBS's entertainment plans makes me incredibly proud," Hurley said. (See     related release: "User Generated Video Goes from Online to On-Air in New     CBS/YouTube Campaign.")  

"Anything is possible," Moonves said. "Audiences know that, content people know that, and innovators in the digital space know that. In the weeks and months to come, we'll have a lot more news on how we'll be working with the interactive community in ways both big and small," Moonves concluded.

About CBS Corporation

CBS Corporation (NYSE:CBS.A) (NYSE:and) (NYSE:CBS) is a mass media company with constituent parts that reach back to the beginnings of the broadcast industry, as well as newer businesses that operate on the leading edge of the media industry. The Company, through its many and varied operations, combines broad reach with well-positioned local businesses, all of which provide it with an extensive distribution network by which it serves audiences and advertisers in all 50 states and key international markets. It has operations in virtually every field of media and entertainment, including broadcast television (CBS and The CW -- a joint venture between CBS Corporation and Warner Bros. Entertainment), cable television (Showtime and CSTV Networks), local television (CBS Television Stations), television production and syndication (CBS Paramount Network Television and CBS Television Distribution Group), radio (CBS Radio), advertising on out-of-home media (CBS Outdoor), publishing (Simon & Schuster), interactive media (CBS Interactive), music (CBS Records) and consumer products (CBS Consumer Products). For more information, log on to www.cbscorporation.com.

Source: CBS Corporation

Verizon to Provide New Local TV Channels on FiOS TV

Michelle Webb, Former Network TV News Producer, Will Be Project's Executive Producer and General Manager

 Verizon announced (Tuesday, Jan. 9) that it will launch local television channels in selected markets in 2007, starting with the Washington, D.C., metropolitan area in the first quarter.

Michelle Webb, a former ABC News producer, will produce and manage the project. The announcements were made at the Consumer Electronics Show here. Verizon will offer the local channels, to be called FiOS1, on its Verizon FiOS TV service.

FiOS1 will include round-the-clock traffic and weather, local news and community sports. Verizon will partner with professional news organizations to deliver some of the content. It will also televise original features shot and produced by citizen journalists using high-definition camcorders and provide a platform for local user-generated content. Verizon will announce more details as the launch date approaches.

Webb joined Verizon last spring as executive producer and general manager, FiOS1 local channels. Prior to her current position, she served for four years as a producer of the ABC News program "Primetime Live," where she did preproduction planning, research and storyline development for features and segments presented on the network's television-magazine shows.

From 1996 to 2002, Webb served as associate producer at CBS News' "60 Minutes," where she worked with correspondent Lesley Stahl. Before joining "60 Minutes," Webb was a producer at "20th Century with Mike Wallace," and a producer for CBS News' documentary unit, for which she wrote biographies and investigative reports for the cable outlets of A&E, The Learning Channel and the History Channel.

Webb is a member of the National Association of Black Journalists (NABJ). A Michael C. Rockefeller Memorial Fellow, she holds a bachelor's degree in anthropology from Harvard and Radcliffe College.

Verizon Communications Inc. (NYSE:VZ) , a New York-based Dow 30 company, is a leader in delivering broadband and other wireline and wireless communication innovations to mass market, business, government and wholesale customers. Verizon Wireless operates America's most reliable wireless network, serving nearly 57 million customers nationwide. Verizon's Wireline operations include Verizon Business, which operates one of the most expansive wholly-owned global IP networks, and Verizon Telecom, which is deploying the nation's most advanced fiber-optic network to deliver the benefits of converged communications, information and entertainment services to customers. For more information, visit http://www.verizon.com/.

VERIZON'S ONLINE NEWS CENTER: Verizon news releases, executive speeches and biographies, media contacts, high quality video and images, and other information are available at Verizon's News Center on the World Wide Web at http://www.verizon.com/news. To receive news releases by e-mail, visit the News Center and register for customized automatic delivery of Verizon news releases.

Source: Verizon

Jan 10

 Bill Gates at CES

It's amazing to see the progress over the course of the year, and truly the Digital Decade is happening. We see it everywhere we look. We see it in photography over 2 billion digital photos were taken this last year; 65 percent of homes are using digital cameras. We see it in the Internet adoption, higher and higher penetration on a worldwide basis, and more and more activity there, whether it's buying and selling, or whether it's planning, or being creative, the Internet connected up to the Windows PC and other devices is taking over things that would have been done without it before. Over 40 percent of U.S. homes now have multiple personal computers. And if you look at young people, the new generation, they actually spend more time on their Windows PC than they spend watching TV. Now that's a pretty dramatic change.

We see portable devices proliferating, a higher and higher part of the growing PC market. We see the connections, both through Wi-Fi and 3G getting to the point where you can get information wherever you want to go. And we're just scratching the surface. More and more can be done because as this marketplace is extended, the number of startups, the R&D budgets of the established companies, all are investing in this global market to do better and better work.

How do we look at that, what are some of the metrics that we have here? Well, we have incredible devices with very high fidelity. Think about cameras, six megapixels and up. Think about these high definition screens that when you buy it you just drool looking at that picture, it's such an improvement over the classic TV screen that you used to have, and now it connects up to your high definition cable, to your PC, to your games, all those experiences taking advantage of that incredible visual capability. Network bandwidth has gone up very dramatically, we're avoiding that being a bottleneck, even as we're sending high definition signals around. The processors are now opening the memory capability up to 64-bit, and that's a transition we're making without a lot of incompatibility, without paying a lot of extra money. Software, the old 32-bit software can run, but if you need to get more space, it's just there.

The graphics resolution is letting us think about representing reality on the screen. So when you shop, you won't just see a list of things, it will be that environment, either the stores that really exist, or the stores that would exist if it was designed for you personally. So we're seeing that in games, we're seeing that in virtual reality, that this presentation richness that all these great devices deliver, because of the graphics chips and the screens, and the development tools, is really quite phenomenal.

Storage space, people aren't talking gigabytes anymore, they're talking terabytes of storage, or petabytes of storage, where really that doesn't hold us back at all, even with the largest databases. So we have amazing hardware. I love walking around the CES floor seeing, okay, who's got the biggest LCD this year, who's got the biggest plasma, who's got the biggest hard disk. So those are an element of the equation of what we need to deliver on the promise of digital decade.

That alone is not enough. There are some key things missing, and in particular the key thing missing is the connection. Delivering on connected experiences requires more than just great hardware. So consumer electronics has been defined to be a much broader industry. As Jerry alluded to, the content people now need to think about how they create around this environment, how they connect into it. It's an environment where people want to do things across multiple devices, working with many other people.

I want my music when I'm in the car, when I'm at home, when I'm in the living room. I want that to be simple. I want my family's schedule, and the ease of updating it, from the phone, the PC, just touching something on the refrigerator. I want to collaborate with people. I want to have the experience connect up to people at work, as well as at home. So we can't just say consumer, because the experiences span into that business environment.

So delivering on connected experiences, where people are being productive, doing new creative things, where they're sharing with each other, where they're mobile, where they're just playing games, that is the key element that's missing, and something that we've all got to deliver on to take full advantage of that hardware, and deliver on the promise.

Now, for Microsoft this year it's a big, big milestone, because the products we've been working on for many years that are foundational products are now moving into the marketplace. First, of course, that's Windows Vista. It's been many years of hard work with millions of people giving us great feedback on that. This is by far the most important release of Windows ever. It's also the highest quality release that we've ever done, whether it's security, or testing, or usability, all of these things we have learned a lot, driven by the feedback that those hundreds of millions of users are able to provide to us.

Vista and the PC continue to have a central role. All these other devices are very, very important, but they've got to work together. As we look at the rise of user generated content and tools of creativity, that is happening on the PC, and yet those have to be available and acceptable on all the different devices. Vista is a big project, and rather than talk about the features I just want to talk about what we've been through to pull this all together. You'll be discovering features as you go forward, because of the depth that's there. A good example of that is I had a friend come up and say, hey, I didn't realize parental controls were built in. I just have to think about buying software, paying for that, I'm not sure I can configure it the right way. It's a lot more immune from tampering, a lot better, when it's just built into the system from the very beginning.

The process we've been through over this year, there was a beta 2 got out to over 2 million people. The release candidate, which was our last chance for feedback, got out over to 5 million. We had a lot of in-depth things where we went in and sat and interviewed people using Windows Vista in family situations. We did that in seven different countries. We did incredible performance simulation, getting over 60 years equivalent of performance testing with all the common mix of applications that were out there.

So a big investment, in fact, the biggest investment ever put into a piece of software. Why? Because it's by far the most used piece of software, and any improvement we can make there not only can save time for people, but can enable everyone who builds on top of it to do some pretty fantastic things.

Having a Microsoft Office release at the same time is fantastic for us. Last time we did that was back in 1995, that was sort of the UI of 32-bit generation, just like this is for the 64-bit generation. So the fact that people can think about moving up to those at the same time really will simplify a lot of the migration, and take out some of the hesitation that's often there when you only move one piece at a time.

With Office it's got a new user interface, it's got new ways of connecting up to Office Live services and SharePoint, and again, very broad, very deep, but the discoverability of the richness is advanced dramatically by that user interface. We've observed over 1 billion sessions of people using this new version of Office. So we know for sure that they are all those features they used to ask us about that we had but they couldn't find, now they are finding those features. So that makes us feel great, because the new user interface was actually a risk, a leap that had to be taken, had to be taken at some point. Now we've taken it, and the feedback has been fantastic on that.

Windows and Office, of course, will connect up to services, services from Microsoft and services from other companies. In our case we talked about Live services, the ability to share files, to connect your e-mails, connect your schedule up into the Internet and so they can flow to your other devices, or flow to other people's, as well. So a lot innovation would be taking place to connect Windows up more and more through those services.

Today we've got literally hundreds of millions of people, whether it's instant messaging, or doing the e-mail capability, and so as we expand those things, building on that very strong base, we can get, I think, most Windows PC users viewing that as an integral part of the experience.

Already the idea of updating their machines, providing them with better software and security improvements on an ongoing basis, it's a well-defined part of the Windows experience. And more and more services come along. So we've come a long way from the idea that this is just a product you get one time and it stays the same. A huge part of that value is the ongoing work that we do and connect up to you through that Internet connection, providing free services, and some add-on services, as well. So that really creates and environment, Windows, Office and those services and third parties connecting up and building on that.

A great way to understand why we're so thrilled to have it out is to see a demonstration. So let me ask Justin Hutchinson to come up and give you a little look at Vista and I'll bet for most of you you'll see at least a couple of things that you're excited about that you've never seen before.

Thank you. (Applause.)

Hi. Tonight we're going to give you a glimpse of Windows Vista, and we're going to show you a couple of things that we haven't shown publicly before. Now, Windows Vista makes it easier, safer, and more fun to use your PC. And as Bill just mentioned, Vista, Office, and Windows Live will come together to deliver amazing connected experiences. So let's take a look.

One of the first things I notice when I use Windows Vista is how easy it is to find all my information on the PC. Last night I was working on a file, I can't remember where I saved it, but if I just go here and type in the first couple of letters of the item I'm looking for, Windows Vista will look across all my programs, Web sites I've visited, my files, my folders, even my e-mail to bring me back the results I'm looking for. Windows Vista will also not only look on this PC, and this is something we haven't told you before, I can set it up to search every Vista PC on my home network. So Windows Vista is not about searching, it's about finding.

So here is the folder I was looking for. The first thing you'll notice, if you're new to Vista, are thumbnail previews. I have previews here that tell me, give me a hint of what's in this file. And if I want to see a larger preview, I can simply open this preview pane, and Vista will show me the contents of every file in this folder. So here's the document I'm looking for, and in preview pane I can see that I made a mistake last night. I saved the wrong document. This is an invitation to something special we're planning tomorrow night at CES, and making a mistake like this before Windows Vista would be a problem, but thanks to a new feature called Shadowcopy in Windows Vista, I can restore previous versions of this document with just a couple clicks. So when I click restore, you're going to see this document on the right revert back to the original. Just like that, Vista reverted back to the original and it got me out of a jam. It's better than going back in time. (Applause.)

So Windows Vista gives me a safety net, and it lets me worry less about making mistakes on my PC. So here I have the document, and it's still pretty rough looking, but using the new Microsoft Word in just a couple clicks I can actually make this dramatically better. Notice as I scroll over these themes, I get a preview of exactly what the changes are going to look like, and as a finishing touch, why don't we format this photo. There we go, just like that. In a couple clicks, I've taken this document from something that was pretty rough looking to something that looks like it could have been done by a professional.

Now I have a link here, and this link takes me to the location of the event tomorrow night, and it's perfect because I don't know Vegas that well. I'll open this up, and this will launch Windows Live Search. Now Live Search will give me information about the location of the event, it will give me driving directions, phone numbers, but that's not what I'm going to show you. What I'm going to show you is the Virtual Earth 3D technology that's built into Windows Live. And this is pretty cool to demo using a mouse and keyboard like I'm doing here, but it's more fun to use an Xbox 360 controller. I can plug any Xbox 360 controller into any Windows Vista PC to play all my games, and I can also use it to fly around Las Vegas here. (Applause.)

This is fun. So you see here a virtual 3D map of Las Vegas. Not only can I fly around, I can actually drive right down the street. This is pretty fun. It's also practical. So if I'm new to town, I can get a sense of where everything is, get a sense of my landmarks. We can also lay down real time traffic information I want to make sure I don't hit the Bellagio there real time traffic information, and that lets me decide not only that lets me see not only what streets I want to drive down, it also tells me the quickest way to get there.

So the best part about this demo, this is live right now on Windows Live. You can go use this tonight. That's just a real quick example of how no clap? (Applause.) Great example of how Windows Vista, Live, and Office come together to deliver some amazing connected experiences.

That was fun. What else is fun on the PC is Media Center and Windows Vista. Media Center is where I can kick back, I can listen to all my music, I can watch and record live high definition television, download movies, and tonight we're going to show you a new experience called SportsLounge. SportsLounge was developed with Microsoft and FoxSports.com, and it's a dream if you're a sports fan, or have a sports fan in your house. Here I'm watching a live HD feed of a football game. Up top I'm getting real-time information, and real-time scores for every sports program in my channel line up. And across the bottom here, I'm getting real-time alerts about my favorite players, about my favorite teams. I can queue up, SportsLounge tells me what's on later, and I can queue it up to record programs. So I know I'm going to work during the BCS title game tomorrow night, Media Center will record it for me automatically. I can get in-depth scores for games that are in my channel line up, or not in my channel line up. And if you love fantasy sports, you're going to really dig this one, I can set SportsLounge up to track all my fantasy teams, football, basketball, baseball and hockey. It will update me on all my players' stats, and I can set up alerts. So if someone is coming up to bat, someone just made a big play, Media Center will send me an alert, and I can automatically tune the channel. It's great, it's a dream if you're a sports fan. (Cheers and applause.)

We're also proud tonight to talk about some new content partnerships in Media Center. Showtime, Nickelodeon, Starz Vongo service will all deliver on demand video content and video services to Media Center customers. Now in Media Center I just showed you how you can enjoy it in full screen with a mouse and keyboard. You can also use a remote control. I can also shrink this down, you're watching live high definition television while I'm going about my business using my PC. Now SportsLounge, Media Center, high definition television, and these rich on demand video services are great examples of how Windows Vista will take entertainment on the PC to the next level.

What else are people doing for fun on the PC? Well, photos. We know that close to two billion photos were taken last year, probably everyone in this room has taken a handful of digital photos. And in Windows Vista the place to edit and organize all your photos is Photo Gallery. Here I have all my pictures, and all my digital videos that I've taken with a digital camera, or a camera phone, but I don't want to leave them on my PC. I want to be able to burn them to a DVD. DVD Maker in Windows Vista makes it simple to share my memories. Here I've added not just my photos but digital video to this DVD I'm going to burn. I click next, I can select from a handful of preinstalled themes, and when I click preview I can see exactly how this DVD is going to look when my friends and family pop it in their home DVD player, just like that. (Applause.)

So let's talk for a second about Windows Vista Ultimate. Ultimate is the flagship edition of Windows Vista, and it gives me everything I need to have more fun at home, and be more productive at work. Now one of the cool things about Ultimate is that Microsoft continues to download features to me on a regular basis, and we call these new features Ultimate Extras. An example of one of these is this technology from Microsoft Research called GroupShot. Now my problem with photos is not necessarily technology, it's not that I can edit them, and organize them, or share them, I can't take a picture to save my life. I'm always cutting people's heads off, or I'm catching people, like in this case, with their eyes closed. So here I have two pictures. In this one her eyes are closed, in this one his eyes are closed. What I want to do is put both of these pictures together into one good picture. So GroupShot is going to let me do that. I simply select here, take the good part of this picture, I go back here and take the good part of this picture. Now GroupShot didn't fix these pictures, it created the picture I wish I would have taken. Pretty cool. (Cheers and applause.)

So what else are people doing with photos? Well, we know that people love to personalize their desktops with all their pictures. And with every version of Windows we ship a whole batch of new themes and wallpapers. Well, a new Ultimate Extra called DreamScene in Windows Vista takes that to the next level with full motion desktop. (Cheers and applause.) And just like with any picture on my PC, I can go to any video and set that as my desktop background. Awesome. (Cheers and applause.)

So you've just seen how Windows Vista is going to make it easier, safer and more fun than ever before to use your PC. We have 22 days until launch, that's it for me. Thank you very much. (Cheers and applause.)

When we think about software developers doing applications for Vista, there's many things that that means. It means in some cases doing 64-bit applications, or doing Sidebar gadgets, or taking the search APIs and exposing the items in their files at a more granular level into that search capability. It means visualizations, not just games, but lots of applications using the latest DirectX Version 10 capability. We're calling our rich new form presentation that we call Windows Presentation Foundation. And so every new version of Windows has had a dual nature, great capabilities for end users right out of the box that they get the benefit, and it lets them drive the volume of that platform up, but also enablement for hardware and software partners. And it's those two things going together that have constantly driven the phenomena around the Windows environment.

One thing that we're very pleased about is the way that people have stepped back and thought about new Windows PC design based on these features. Now in many cases they came to us and we put the right feature into Vista, or we did the feature and we went to them and encouraged them to do something very innovative. A good example is touch screen. Touch didn't used to work very well because your fingers would be too big. Well, in the software we've come up with a way to let you target in a rich way. And so now HP with their Touch Smart selecting photos to print, and doing lots of things with touch, it's just so obvious that you wonder why touch hasn't always been there as one of the great ways of doing interaction.

Toshiba with their Portege has done all sorts of neat things that you'd expect for a leading edge portable. They've taken the ability to have what we call a Sideshow alert, put that on the side of the machine so you can see information, even when the device is closed. They created a document station that actually uses high bandwidth wireless, ultra wideband, so you don't even have to plug in to get your video display. It just sends the DVI signal across that wireless connection.

Sony with some great Media Center packaging. Medion taking this Ultra Mobile, the small screen concept, making that really a great second PC that you can carry around and do reading, and media type things. And so we're expanding a wider variety of design points. We drawing on the strength that comes from lots and lots of great hardware partners that have stepped back, bet on Vista to be successful, and done neat things with it. And so they deliver on these experiences. They let people work together in new ways.

Here, the partners are going to keep surprising you, but the ones that I showed specifically are actually timed for the Vista launch. And so right then there's something very dramatic, but every month people will be building things, whether it's the large manufacturers, the system builders, things that take the Vista phenomena and actually drive it forward in a new way. So let's take a look at some of these new Windows Vista PCs.

(Video segment.)

Speaking of great things that our partners have done together with us, I'd like to talk about a product that's new for us, entry into a new space, and we think a very important space, and it's a project we worked very closely with HP on, and that is defining what we call a Windows Home Server. So let's take a look at the concept here.

(Video segment.)

You probably recognize that format that HP is using to talk a lot about the neat empowerment things they're doing. This Windows Home Server is for homes where you've got either multiple PCs, or Xboxes, the case where you want to have your storage available at all times to the different devices. This is a product that will come out in the second half of this year. HP will brand it as the HP Media Smart Server, and it's the Windows Home Server software with their enhancements that will run on top of that

What are the features? Automated backup, it goes and finds the PCs, brings the information up and makes sure that it's all stored here up on the server. We've got connectivity, connectivity to, of course, all the different PCs, but the Zune, Xbox, and remote connectivity. If you're somewhere else coming in and getting your files, having access to them in a very secure way, that's set up for you, no complexity in terms of how you have to get involved with that.

Finally, if you want to grow the capacity, you don't have to think about volumes, or different devices, or names, or things like that, you literally just plug the new storage in, and it's got quite a bit of expandability, and automatically the software will see that storage, move the data around, so that any drive problems you run into it makes sure that you're not losing information. So you can get up to literally terabytes on this device.

We've got HP as the lead partner, but also AMD, Intel, and (Becktech ?) and lots of others are building hardware reference designs. Since it's a software-driven device each of the partners will be able to do some unique things running on the server tier, so even more richness as you look at the variety that will be out there.

So we think it's a category that that can explode in importance. We think it takes a real emphasis on great simplicity and so that's what we think we've got here entering into the category, of course, and a lot more we'll do as we get in and see the feedback from the users there.

I'd say a very big part of connected experiences is connected entertainment. So to talk to you about mobility, gaming, TV, movies, music, is the person some people think has the most fun job at Microsoft, and that's Robbie Bach who is the President of Entertainment and Devices Division. So let's welcome Robbie to come on out. (Applause.)

So our challenge is bringing those two concepts together in a powerful way. Now, you don't just do that by having great hardware, or by having great software, or by having an innovative service. You do that by combining those three things with an integrated concept of hardware, software, and service that can deliver connected entertainment. So what I want to do today is talk about connected entertainment in the context of our work in music, in mobile phones, in gaming, and in TV and movies.

So let's start with music. A year ago at CES Bill Gates introduced, along with executives from MTV, MTV's Urge music service. And that was a very exciting announcement for us, and a product that's been very successful. We are continuing to be committed to that product and others like it from the 350 partners who are helping us deliver a platform for music around the world. We think that platform is alive and well, and will continue to grow.

Now, this year in 2006 we did add a second part to our strategy, which is the introduction of Zune. We're very excited about what we've been able to do with Zune, and we're very excited about what we've been able to do with Zune this first holiday. In our segment of the MP3 category we are the number two player already. We are on track to ship and sell a million copies of Zune. And whether it's the great screen we have, the wireless connectivity, the FM radio built in, or the combination of those things that are driving it, Zune is off to a great start, and it's just going to get better.

The service is going to continue to expand. We're going to continue to improve to software and the hardware, and the community of music around Zune is going to continue to grow. This is a place where we are deeply committed to being successful, and you're going to see us in this space in a leadership position in the years to come.

So that's music, now let's talk a little bit about mobility and mobile phones. This is an area where we've made tremendous progress. This year we have some of the hottest selling phones in the marketplace, and the cool thing for me about those phones is it's not just about phone calls, although we do that great, it's not even just about e-mail, since that was the next round of things people wanted to be able to do, but it's also about IMs, it's about movies, it's about TV, it's about music, it's about connected entertainment on my phone.

So the features we're delivering in these exciting products are bringing that to market. If you think about Cingular's Blackjack from Samsung, Cingular's Treo from Palm, the T-Mobile Dash from HTC, and Verizon's Motorola Q, those four alone are leading, cutting edge designs that are driving tremendous market share advances for Windows Mobile.

In 2007 you're going to see that continue to grow, with new software and services continuing to build content and a community, as well as bringing out business productivity that we've always been known for. All of these things are reasons why today Windows Mobile excels, and why we outsell Blackberry in the market. (Applause.)

So that's mobility. Now I want to talk a little bit about gaming, and I want to start with Games for Windows. Windows Vista, as Bill discussed, is critical for our effort in this area. It will revitalize the gaming market with Windows. I should remind everybody here, the PC and Windows is the number one gaming platform in the world, 200 million people every month play games on Windows. So it is a leadership platform, and it is going to continue to grow.

Windows Vista is going to expand that dramatically, by making it more powerful with DirectX 10, and key graphics technologies that are being built into the product, by making it easier to use so that the process of buying a game, putting it on your machine, and playing it is dead simple, and making it safer with family settings, where parents can really control what their kids are doing, and make sure the content is appropriate for their children.

Now, one of the cool things about Games for Windows is it's about hardcore gamers, for sure, but it's also about casual gamers. This is a very broad ecosystem, what I'd like to do now is show you a short video that gives you some context for how broad it is, and how cool the next generation of gaming on Windows Vista is going to be. Let's roll that video.

(Video segment.)

So Games for Windows is an incredibly growing market, and you can see that it's a market that includes things at your desktop, on the go, wherever you want, there's a gaming platform on Windows for you to be able to use and get great effects with those games. But, of course, Games for Windows, while it is our leading and largest gaming platform, it's not the only gaming platform Microsoft has. Our second is Xbox 360. And I'm very excited about the progress we've made to become the leader in this next generation of gaming. We have sold through December 31st 10.4 million consoles across 37 countries around the world. That's a half a million units a head of our projection. (Cheers and applause.) In some ways the data that's more interesting is when we do the survey data, the majority of those owners of Xbox 360 are new to the Xbox platform. That tells you how we are expanding the market, that tells you how we're growing, and how we're becoming a leader. And when you look at games, and the attach rate of games, the number of games sold per console, and the number of peripherals sold per console, we are setting records on Xbox 360 every step along the way for a console at this stage in its lifecycle. So this ecosystem is alive, burgeoning and growing, and really setting the pace for what's going to happen in the future.

Now I talked about games attach, and clearly as we go forward games is what this is going to be about, and Gears of War from Epic Games and Microsoft is setting the pace. In the first eight weeks, we sold 2.7 million copies of Gears of War. That title is now a Halo-like franchise that continues to drive hardware in a very positive way, and we think it's an evergreen property that we're going to be able to leverage for a long time. But it doesn't just stop with Gears of War. We have 160 titles on the platform today. That number by the end of 2007 will double to over 300 titles, games like Dance Dance Revolution, Guitar Hero II, and there's a new game from Microsoft called Mass Effects, and of course Grand Theft Auto 4, all coming to Xbox 360 this calendar year.

Now when you talk about games and Xbox 360, and you talk about the year 2007, there's one title that will be the story of 2007, and that title, of course, is Halo 3. So let's take just a little sampling of what Halo 3 will bring this year.

(Video segment.)

(Cheers, applause.)

But in some ways more important you can carry that fight to Xbox Live where people will be playing today Halo 2 and soon Halo 3 in a really exciting environment.

And Xbox Live has made tremendous progress over the last 12 months. We're now the largest social network on the TV. The network of people playing Xbox Live has now reached 5 million members, with an amazing gaming experience but also the ability to communicate with each other and build their own social networks. That is an exciting level of activity unprecedented and unanticipated even two or three years ago.

Now, the key thing we're focused on with Xbox Live is continuing to expand that community, and what we want to do is take it to a whole new level. And so we said, gosh, we have the largest gaming platform in the world on Windows and Windows Vista; let's take the live experience and bring it to Windows.

And so what I want to do now is demonstrate the live experience on Windows, and for that I have Lisa Sikora on stage, and she's going to take us through a demo of Live on Windows. Lisa?

So, here I've got my laptop, and it's running Windows Vista. Now, I do everything with this laptop. It's my work, it's everything.

So, I'm going to start up a game of Uno here. And Uno is one of my favorite games actually, and, in fact, it's one of the top downloaded games on Xbox Live today.

Now, everything that you see here is very similar to what you see on Xbox Live, but it's all been customized for Windows Vista. And you know what, for me it's drop dead simple. I love this.

Now, here I am, I'm in my game lobby, and I'm Hurricane. That's my gamer ID, that's how people identify me in my live community.

Now, let's check out this. So, here's the live guide. Now, it looks exactly like you would see on Xbox 360 and all the same community features. Is that cool? Now I'm going to go into my friends list, and here we go, I've got not a lot of friends.

So, here we've got Ice Monkey. Now, Ice Monkey happens to be Albert over here on the couch, and he's playing Geo Wars on his Xbox 360. Now, the fact that I can see where my friends are and what they're doing right here on Windows Vista, now that's pretty cool for me.

So, let's go and see if Albert wants to jump into a game of Uno with me. So, I invite him to a game, and boom, invite's been sent over to Albert.

I'm going to go ahead and accept Lisa's gamer invite. And just like I'd expect on the Live service on Xbox 360, I can quickly exit the game that I'm playing and join hers.

Uno is a great game, but it's just one example. With titles like Shadow Run and Halo 2, this is going to open up a whole new world of friends for me, whether they're playing on Windows Vista or playing on Xbox 360.

Now, you say that's Uno and it's a simple concept, but it applies to both casual games and more serious traditional hardcore games. And that's the concept of reaching out to those 200 million gamers and providing them with an amazing Live experience.

This will build a worldwide service that spans platforms and creates great communities. This will roll out on the Live services this summer.

Now, today on Xbox Live we've seen about 3 billion hours of gaming. So, Microsoft isn't just a productivity company, I want to be clear about that: 3 billion hours of gaming. And I'm very excited to see where that will go as soon as we bring Live on Windows into play.

So, now we've talked about music, we've talked about mobility, we've talked about what we're doing in gaming. I want to switch tack and talk about TV and movies. And really in this space the big news obviously is high-definition and how fast that is taking off. If you went into a retail store this holiday season, high-definition TVs were the thing to buy. It was an amazing year for HDTV and for that process and that platform to get going.

And I want to talk about four ways for you to get high-definition movies today on the Microsoft ecosystem. Now, the first of those is through our HD-DVD player. This comes that you can buy for Xbox 360.

Now, I want to point out we've been making as many of these as we possibly can, and they continue to sell out. Demand for this product is incredibly high.

Perhaps the bigger news than that, though, is that the HD-DVD format has been the top selling format this year. And that's a combination of the fact that it's had the most movies, it's been the most affordable, and it's had the most interactive and compelling interactive features with our technology that we've put into that product. So, this really creates a great environment for people who want to use the disk space environment to access and interact with high-definition movies.

Now let's go to the second way in which you can get that high-definition experience, and that, of course, is on Media Center. Bill talked about there was a demo of Media Center before. The data behind that data is pretty impressive. This holiday 80 percent of PCs sold in the United States were Windows XP Media Center PCs. We have now passed 30 million copies of Media Center sold worldwide. So this is now a market that is absolutely at scale. We are seeing tremendous momentum in this space.

And when you network that PC with your Xbox 360 for high-definition TV, you can get all the experiences you want: music, movies, cable TV, high-definition content, from Media Center streamed to Xbox. We call it Media Center Extender on Xbox 360, and it's a very popular product. We're continuing to see that. It comes with Xbox built-in, and we continue to see that expand and roll out. You don't need an extra box, just connect it up and go.

So that's the second way you can get high-definition content into the Microsoft ecosystem.

Now, the third way is with Xbox Live video, and this is really a very exciting thing we introduced in November with a number of content providers, over a thousand hours of content. And it's really simple, because your Xbox is already on the Internet, and it's connected to a big TV. And with that thousand hours we're adding today Lion's Gate to the mix to create even more content and provide even more content to Xbox 360.

So, what I want to do now is I want to turn it over to Lisa, and she's going to give you a quick demo of how simple it is to get a movie up and running. Lisa?

You know, I love to watch movies, and Video Marketplace has become the easiest place for me to download great high-definition movies and TV content. So let's have a look at this.

So here I'm going to go into my TV shows, and going to check out some networks here. Now, we've partnered with some of Hollywood's finest, and I can download TV content from all of these great networks, a ton of them in here, check them out.

And now in terms of movies, wow, we've got a huge movie lineup. So, if you can see here, I've actually already downloaded Warner Bros Superman Returns, and it's on high-def, and it's ready for me to play whenever I want to.

Now, the final area where we can bring high-definition to our platform is what we call IPTV. Now, two years ago we demoed IPTV at this show, and really gave one of the early first looks at what IPTV could deliver.

Today, we are now in market with five providers: AT&T, British Telecom, Deutsche Telecom, C-Com in France, and Swisscom. We are doing great work with those companies to roll this out to consumers, and we're also working with 11 other customers and a number of others who are in trial or evaluation.

This market is going to continue to grow, and over the next three or four years is going to become a major part of the TV delivery ecosystem.

So, I want Albert again to take us on a quick tour of IPTV as it ships today. Albert?

The IPTV demo that you see here is going to unlock the potential of your TV. IPTV, the first thing you'll notice about it is that it's fast. I hate waiting. And with our instant channel zapping, no more waiting a couple of seconds for the channel to change. I get instant gratification.

Another great feature is our improved channel browsing. With our picture-in-picture feature I can actually see what's on the next channel before I change over. This is going to be the next generation of channel surfing.

Now, IPTV delivers everything you'd expect from a great TV experience. I can watch and record my favorite TV shows in standard and high-definition, I can order videos and movies on-demand, or I can quickly search for my favorite programs by actor, title, or director.

Now, I know that some of you may have seen IPTV in the past, but what I can guarantee that none of you have seen is IPTV running on an Xbox 360. (Applause.)

I'm going to bring up the Xbox guide, and I'm going to go ahead and accept this game invite for Gears of War. The bringing together of IPTV and Xbox 360 is going to give me all of the amazing next generation features of IPTV and the rich connected experience of Xbox Live. So I'm going to be able to get game invites, but what's really cool is using a headset I can actually talk with my friends while we're watching TV.

Now, I'm going to start up Gears of War here, and for me, being able to play games on an Xbox 360 and watch TV as an enthusiast, Xbox 360 now does everything I want in my living room. I can play the best next generation games, download movies and TV shows, connect to my Windows PC and access my music and my photos, watch HD-DVDs, and now experience next generation TV programs with IPTV.

This is everything I want, it's all in one box, it's all on Xbox 360.

Now, the thing I want to point out is that IPTV on Xbox 360 allows our service providers to really differentiate their TV experience, because now on one box not only can you get an amazing TV experience through IPTV, but you do get all that great gaming experience that is Xbox 360.

This will be available through service providers this year, holiday 2007, that experience available to consumers.

So now that brings us full circle on connected entertainment. We talked about music and the strides we've made there, both on our Windows ecosystem world and in Zune. We talked about Windows Mobile and the progress we've made, and the leadership position we now have, and the strength of our product offering there. We talked about Xbox 360 and games on Windows, and what we're doing to build an incredibly exciting gaming environment across those two systems with our Live service. And we talked about the work we're doing in TV and video to really give customers the breadth of options they want to get the video they want on their system.

The exciting thing about that for me is more choices for consumers, great software, great services, the ability to take their content wherever they want it whenever they want it, and share it with their friends. We're going to deliver connected entertainment over the coming years, and I think it's going to be a very powerful experience.

Thank you very much. (Applause.)

And in thinking about that broadly, one area that comes up that clearly demand special work, and that is thinking about connecting to the car. Now, over time the kind of entertainment you have in the car is you're going to want the same great things that you have everywhere else.

But the car is special. You've got to have things that are simple. If you want to deliver to the driver you have to think about incredibly simple commands, safe ways to get that driver involved.

A lot of people spend over an hour and a half in their car every day, and so they want it to fit it, they want to get at their information and their content and have those capabilities.

And so we've been investing in this, and we've had a very key partner who's been willing to pioneer this with us, and we're just making a significant announcement in that overall vision today. And so to help me with that, I'd like to welcome Mark Fields, the president of the Americas for Ford Motor Company, to join me on stage. (Applause.)

The new thing is a fully integrated, voice activated, in-car communications and entertainment system for mobile phones and digital music players. And it's a Ford exclusive, and we're really excited about that. It's a Ford exclusive technology driven by Microsoft Auto software.

So what Synch does is it totally integrates like never before all of your electronic devices, like your cell phones, Zunes, iPods, all the things that are in your pockets when you get in your car, right into the vehicle, and seamlessly.

Now, with Synch, what it means is you have access to the full capability of your Bluetooth phone, and it's just a voice command away.

So, Synch is unique in that it means never, never having to download your phone book ever again. It downloads every personal setting, like personalized ring tones and three-way calling right through the vehicle's audio system.

And drivers can place and also receive calls, and also text messages through the audio system. They can even maintain a call phone conversation while entering or exiting a vehicle. How many times have you gone up to a vehicle, get into the vehicle, got my Bluetooth, I'll call you right back? You never have to do that again.

And Synch also allows users to have their text messages actually read aloud to them through our new text-to-speech technology, which even translates Internet slang like LOL and other expressions, like smiley faces.

And most exciting -- most exciting, it has the ability to be a full entertainment platform, as it accepts nearly all portable music players and most USB storage devices. It even accepts Flash and Zip drives. And through is voice recognition software it can even create personalized play lists with a simple voice command, and nothing on the market can do that.

And because it's fully upgradeable -- and this is really important -- owners will never have to worry about whether their car is compatible with the latest phone or music player that hits the market. And we all know how fast the marketplace moves these days.

Now, in the past, Synch is the kind of feature that probably we would have introduced probably on luxury cars, but we're going to roll it out quickly and affordably, because Synch's market potential from our perspective is absolutely huge.

And Synch is going to be available on a dozen -- a dozen Ford Motor Company products this year, including our new Ford Edge crossover, and the new Ford Focus, which we introduced earlier today in Detroit, because right now the auto show is going on, so we did the press conference this morning with about 3,500 journalists, and it was really exciting.

So, Synch gives us the opportunity and the incredible opportunity to dramatically improve the appeal, the capability, and the value of our vehicles, because delivering more products people want is absolutely key to Ford's success going forward. And working with Microsoft, it's this type of technology that's going to help us do it.

So, thanks, Mark, great to have you here --

Well, so far in this keynote we've only talked about products that are either shipping now or shipping this year. I wanted to close by taking the timeframe and moving out a little further and talking about how all of this will change and come together in the years ahead. Think of the home in four or five years. Think of what connected experiences will mean as you get further out. After all, there's some incredible breakthroughs that can make a big difference here. Speech, which we talked about using in the car, you'll use that to interface with your phone and even with your PC, not replacing the keyboard or touch or pen, but simply complementing those things.

The ability to have a camera on your PC know what you're doing, if you're paying attention, to recognize who's there, to do the right thing, incredible capabilities that will come through that.

And so those kind of hardware things, combined with software, can drive new experiences.

One way we get a sense of this and share that is we build a futuristic home on our campus. We call it our Microsoft Home of the Future. And we're just finishing the new version of that, and so I thought I'd take some key pieces, the really exciting elements of that, and show you a couple of the scenarios there, and give you a sense of why we continue to be so excited about connections achieving richer and richer goals.

I'm going to start out here away from home. I'm just here at a bus stop. Of course, I'm very familiar with bus stops. (Laughter.) And I can see this nice screen here telling me which bus is coming when. Now, my phone knows my location, and so when I just sit here, it tells me the bus is coming, so I get that information. I can even look on a map and see where that is.

Also based on where I am it knows things I might be interested in, and so it tells me about a nearby restaurant that meets the profile of the type of restaurants that I'd be interested in. And here I've even got a special offer. I can see that I get a little percentage off, and I can take that coupon that's being offered to me because I'm in this area, and store that away, and so I'll be able to use that when I actually go and visit there later on. I also get the ability now to browse in and see their menu, make reservations, all those kind of neat capabilities.

Now, I get a little notification here that at my home somebody has run the front door and they're trying to deliver a package, and so I can take a view through my camera, see who's there, and if I want to go ahead and say, yes, I accept this package, and send my digital signature, I'll just click and do that. Then sure enough, I get this nice icon that shows that I'm verifying that it was me who authorized that so that delivery person can say, yes, they were allowed to go do that.

So here I am just with my phone doing a lot of rich things, location based, connected up.

Now let me move to my kitchen, and here I am. It's another place you can imagine I have deep expertise to bring to this scenario. (Laughter.) And I need help here in the kitchen. Well, what's one of the big advances that will make that possible? Screen technology, projecting onto walls, onto surfaces is going to be quite inexpensive, and so it will be very pervasive. So this surface, although it's just a normal surface, we can project onto it, we can use voice to drive this.

And so I get the package that was delivered to me, and it was this wonderful little food mixer, and I think, gee, I want to -- [computer voice] -- so it notices I put that up there, and sees that I've never used it before, and, yes, I would like assistance. And so it brings up some options.

Then I've got a little ingredients here. I've got my flour, and it notices that with the RFID, and brings up recipes that might be appropriate to that. Here I see a couple different choices, and I think, hmm, what are my options? How about healthy? Show me what's in recipe two here. Okay, and so now it's even got the full list of ingredients, it's checked off the one that it sees that I've got with the flour there, and so I can go and get the other things. When I'm ready I just say, show me the directions, and, of course, it will go and display that. It's even nice enough to give me this view of a sense of how big I need to make this as I'm rolling up the dough, and so it can even be interactive in helping me move along. And it's just a little bit of software in that kitchen environment.

Now let me move on to another location. Here I am in a fairly typical bedroom, and I've got this nice mobile PC that I can carry around, lets me control things and do things in this bedroom environment.

So, when I start out, I see I've got kind of a cool scene that I picked here, and I can actually pick out a music group that I like, that I browsed and found, and I say, hey, let's take that and select that picture and go ahead and put it up there. And so I can combine different things. This represents my personality, my room, but, of course, it's being done by using this nice display capability that's there on my wall.

So if I want to think, hey, let's go get something else, I can click along here, and I think how about that aquarium, that looks pretty good. Let's choose that instead. Of course, it's kind of neat, I can learn about the fish or just have that as a soothing background. Maybe I want to switch to something else. Let's see what I've got. Hey, this is pretty neat. I've got racing sense, and so it's going -- and this is actually from my Xbox 360 here, so I can go ahead and navigate along, play this thing up on the wall. That's pretty cool. It's got the sound and everything.

I'm having a lot of fun here in my room doing exactly what I want, but then I notice that I've got to remember what's going on today, that my sister's going to pick up grandma, and I realize, okay, I'd better get things ready, I don't want to just be sitting around like somebody who plays these games all the time. Let me see what type of environment will be like for grandma when she's actually going to come and stay here. (Laughter.) It's a little different than what I picked. In fact, I've even got this nice little video camera back at grandma's house, and so that's her dog there, and when she comes she'll find it neat. She can even see if her dog is okay, and I'll watch that.

And so it really becomes part of the environment. The environment really is so different because you've got these digital screens, and you've got this way of interacting that's very, very simple.

And so the idea of connected experiences can go way beyond what we've got this year. We can take these incredible improvements in the hardware, we can take the new type of content that's even being designed for interactivity, we can take this powerful software, building on the work that you're seeing this year, whether that's Vista or Office or all the great third party things connecting up to the devices, we can take that and go to a new level.

We need a lot of feedback from users. We need a lot of great research and make the reliability, the security, the simplicity of these things really great, and so that means there's some fun challenges ahead for the software and hardware business. And every year we come here and we see an immense amount of progress, the incredible competition that's driving the prices down, getting all these things to work in new ways.

And so let me just thank all of our partners, and thank all of you for your support, and say how excited I am for all of us to see how this develops the fulfillment of the vision of the Digital Decade. Thank you. (Applause.)

END

Jan 8

              Satellite and TV System - DIRECTV(R) Sat-Go

    Key DIRECTV Sat-Go features include:      --  Integrated 17-inch LCD monitor and satellite receiver with two         speakers      --  Compact and portable flat antenna and satellite receiver      --  DIRECTV(R) programming accessed through a platform based on         DIRECTV's D11 set top box      --  Small profile IR remote      --  Component and composite A/V inputs      --  Composite A/V out      --  Satellite in connection      --  Phone Jack      --  USB connection      --  AC and DC capable (cigarette lighter adapter included)      --  Rechargeable, replaceable, laptop-style battery 

Celebrating the one millionth Ambilight FlatTV, the Diamond FlatTV will be shown at different events around the world to Philips customers, employees and consumers and is one-of-a-kind and will not be available for retail.

Philips’ exclusive, Ambilight backlighting technology transforms the overall viewing experience by surrounding the TV with ambient light that automatically adapts in color and intensity according to the changing content on the screen, resulting in a completely immersive experience. A recent Philips satisfaction surveys found 85 percent of customers rate Ambilight technology as “very good” or “excellent”.

“Manufacturing our millionth Ambilight FlatTV is a great moment for Philips and demonstrates that consumers have responded strongly to the viewing experience that Ambilight provides,” said Rudy Provoost, chief executive officer, Philips Consumer Electronics. “To celebrate in style, we have created a truly glamorous, iconic set to commemorate our entire line of Ambilight FlatTV models. Ambilight backlighting provides an amazing, immersive viewing experience that is unmatched.”

A.Link worked with Philips to develop this one-off special edition Ambilight FlatTV, celebrating the millionth Ambilight FlatTV. The company provided the diamonds as well as its century-old expertise in helping create this one-off special edition Ambilight FlatTV. The set features 225 carats and close to 2,250 diamonds set into a graceful stylized floral pattern around the edges of the TV, and will tour the world in 2007 to mark this important milestone for Philips.

Introduced by Philips in 2004, Ambilight creates ambiance, stimulates more relaxed viewing and improves perceived picture detail, contrast and color. Originally introduced on the left and right sides of the FlatTV, the award-winning Ambilight technology can be found in two, three and four-sided (Full Surround) LCD and Plasma models.

In the past decade Philips has drawn on 60 years’ heritage in television to capture a leadership position in the LCD display market. The millionth television comes on the heels of the 10^th anniversary of Philips’ first-ever flat-panel TV, a 42-inch (107cm) Plasma FlatTV which was displayed at CeBIT Home in 1996. Only four-inches (10cm) thick with a widescreen viewing angle of 160-degrees, “the world’s first TV you can hang on the wall like a painting” created a worldwide media storm.

Today, the majority of TVs sold by Philips are either LCD or Plasma FlatTVs. The 2006 range now comprises a massive range of more than 30 models, with consumers offered a selection of screen sizes from 15-inch (38cm) up to 63-inch (160cm), with more than 90 percent ready to display high-definition TV.

Developed as a celebration for the development of the millionth Ambilight FlatTV, the set is not available for consumer purchase and will be auctioned off to charity later in 2007.

Royal Philips Electronics of the Netherlands (NYSE: PHG, AEX: PHI) is a global leader in healthcare, lifestyle and technology, delivering products, services and solutions through the brand promise of “sense and simplicity”. Headquartered in the Netherlands, Philips employs approximately 126,000 employees in more than 60 countries worldwide. With sales of EUR 30.4 billion in 2005, the company is a market leader in medical diagnostic imaging and patient monitoring systems, energy efficient lighting solutions, personal care and home appliances, as well as consumer electronics. News from Philips is located at www.philips.com/newscenter.

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Boasting the highest resolution available for consumers, advanced picture processing and unrivaled style, Philips’ new Ambilight FlatTVs deliver powerful performance that will impress today’s most demanding consumers. Philips’ new Ambilight LCD FlatTVs range in size from 32- to 52-inches (32PFL7332, 42PFL7432D, 42PFL9832D, 47PFL9732D, 47PFL7432D and 52PFL7432D). The 42-, 47- and 52-inch models now boast 1080p resolution, Perfect Pixel HD Engine to maximize 1080p content for the best picture, Pixel Plus 3 HD, Digital Natural Motion and ClearLCD, the peak of high-definition (HD) for today’s demanding consumer.

“Ambilight backlight technology is the perfect complement for the consumer who wants the latest HDTV viewing,” said Todd Richardson, vice president of Connected Displays, Philips Consumer Electronics, North America. “Ambilight features a dramatic color and light effect to draw consumers even deeper into the action. This use of custom backlighting reduces eyestrain, improves the perceived picture detail, contrast and color and creates a deeper, more immersive viewing environment. Ambilight, coupled with our new design and picture processing advancements, makes a Philips FlatTV the perfect set for any room in the home.”

Philips’ recent research shows that 85 percent of consumers who bought a FlatTV set with Ambilight backlighting in the past year hail the product as either “good” or “excellent.” In addition, Ambilight offers much more relaxed viewing experience by significantly reducing eye strain. This is achieved by decreasing pupillary contractions caused by changing on-screen light intensities.

The Ambilight backlight technology has already gained the recognition and support of the SMPTE (Society of Motion Picture and Television Engineers), which said the optimum level of ambient light should be less than 10 percent of the peak white output of the television. In line with the SMPTE’s recommendation, Ambilight background technology allows the user to choose a static warm or cool white effect. For customization, consumers can select the active mode where the software determines the color of the light. Or just specify the ambient light color to suit personal preference.

Underlining its reception with consumers, Philips recently announced it manufactured its millionth Ambilight FlatTV. Ambilight continues to evolve in 2007 as the Ambilight effect is now created by an innovative LED light source. The LED generates more saturated colors, allows for a more compact set design and consumes less power than prior models. With the new LED illumination, consumers can enjoy a more immersive viewing experience.

The innovation of the Perfect Pixel HD engine offers the unique combination of superior sharpness, natural detail, vivid color and smooth natural motion on HD, standard TV signals and multimedia content. Perfect Pixel HD Engine offers consumers the processing power and processing accuracy to best display 1080p images. Each pixel of the incoming picture is enhanced to better match the surrounding pixels, resulting in a more natural picture. Artifacts and noise in all sources from multimedia to standard TV to highly-compressed HD are detected and reduced ensuring, that the picture is clean and razor sharp.

Further elevating the quality and clarity of the sets, ClearLCD technology addresses two common limitations of LCD TVs: motion artifacts in fast-moving pictures and reduced contrast in rooms with low ambient illumination. Philips’ ClearLCD provides razor sharp moving images, dramatically increased black levels and contrast and a much wider viewing angle than found in previous LCD sets. Complementing the ClearLCD feature, the 42PFL9832D, 47PFL9732 and 52PFL7432 sets feature a 120 hertz picture refresh rate. By doubling the picture refresh rate from the standard 60 hertz, the sets deliver fast, streak-free action without the blurring previously experienced on LCD FlatTVs.

Expanding the viewing experience through independent colors, Philips’ Ambilight 2 Channel technology creates a stereo, two-sided lighting environment. The light mode can be customized to match the same colors on each side of the set or independent colors on each side. The Ambilight 2 Channel feature has increased light output, as well as new software that ensures an accurate match between colors on the screen and light displayed throughout the room.

Royal Philips Electronics of the Netherlands (NYSE: PHG, AEX: PHI) is a global leader in healthcare, lifestyle and technology, delivering products, services and solutions through the brand promise of “sense and simplicity”. Headquartered in the Netherlands, Philips employs approximately 126,000 employees in more than 60 countries worldwide. With sales of EUR 30.4 billion in 2005, the company is a market leader in medical diagnostic imaging and patient monitoring systems, energy efficient lighting solutions, personal care and home appliances, as well as consumer electronics. News from Philips is located at www.philips.com/newscenter.

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Only five-inches thick, the Ambisound SoundBar provides a stylish system with amplifier and a DVD player all in a single sophisticated design. Whether listening to a CD, watching a favorite DVD or enjoying a TV program, Ambisound will ensure consumers are enjoying an immersive entertainment experience.

“The SoundBar with Ambisound technology elegantly combines a fantastic listening experience with an innovative and flexible design,” said Andy Mintz, senior vice president of marketing, Philips Consumer Electronics, North America. “Ambisound allows consumers to enjoy 5.1 surround sound performance without the hassle of multiple speakers or wires. The system provides powerful surround sound sporting a design that matches any FlatTV and fits in any living room, not relying on walls to bounce or reflect sound around the room.”

The Ambisound SoundBar features five amplifiers, similar to a 5.1 system, integrated into a single horizontal sound bar. The HTS8100 uses a host of technologies including array processing, precise driver positioning and psycho-acoustic innovation to achieve the full surround sound performance.

For maximum audio quality and clarity, the Ambisound system features a 3-band equalizer and DoubleBASS™ deep bass performance, creating a smooth cross over between sounds. The speakers feature soft dome tweeters for increased clarity and clear voice performance and are designed for maximum efficiency for full midrange performance. Additionally, users will enjoy the Smart Surround™ feature, which automatically ensures correct surround sound settings whether a movie or music is playing.

In addition to the latest audio technology, the Ambisound system is only five inches thick and can be easily mounted onto a wall underneath an existing FlatTV™. The simple, yet elegant design enhances the décor of any home theater space, regardless of the room layout or design. The center console is designed to be mounted on a wall or resting on a stand.

Featuring a single central sound bar and sub woofer, there is no risk of cluttered space or obstruction of speaker wires. For added convenience, the HTS8100 is ready to use immediately out of the box, with a quick and easy set up session.

Combining amazing audio performance with stylish design, the SoundBar also creates a best-in-class viewing experience with Faroudja DCDi and HDMI 1080p picture quality, delivering outstanding results.

Perfectly complementing the Philips Ambilight™ FlatTV range, the HTS8100 creates a truly immersive entertainment experience. The HTS8100 will be available in second quarter 2007 and retail for $999.

In addition to the HTS8100, Philips offers the HTS6600 using the same technology but in a two speaker system. The HTS6600 features a sleek vertical design that adds style and grace into any environment. The system offers consumers another stylish and innovative option that reduces clutter and provides fewer wires.

Much like the HTS8100, the HTS6600 is packed with advanced features providing a great listening and viewing experience. The audio performance is enhanced by personalized settings, Smart Surround, 3-band equalizer, soft dome tweeters, DoubleBASS, highly efficient speakers and high excursion woofers providing a pure and clear audio performance. For additional enjoyment, the HTS6600 features HDMI digital A/V connectivity with video up-converting to 1080i providing an excellent image.

Retailing at a suggested $599, the HTS6600 is available in second quarter 2007.

Royal Philips Electronics of the Netherlands (NYSE: PHG, AEX: PHI) is a global leader in healthcare, lifestyle and technology, delivering products, services and solutions through the brand promise of “sense and simplicity”. Headquartered in the Netherlands, Philips employs approximately 126,000 employees in more than 60 countries worldwide. With sales of EUR 30.4 billion in 2005, the company is a market leader in medical diagnostic imaging and patient monitoring systems, energy efficient lighting solutions, personal care and home appliances, as well as consumer electronics. News from Philips is located at www.philips.com/newscenter.

 Jan 7

On the eve of the 2007 CES Show, Verizon Wireless announced V CAST Mobile TV, a new and unique service that will allow TV viewers to leave the house and still have many of their favorite TV programs in their pockets or purses.

The service is expected to be available in the first quarter of 2007. With an initial launch in many major U.S. markets, V CAST Mobile TV will feature the best of broadcast and cable television with live content and other programming 24 hours a day from many of the world’s best-known entertainment brands, including CBS, Comedy Central, (Fox), NBC News, NBC Entertainment, Nickelodeon and representing a variety of options for all types of TV viewers.

Jan 6

Global press convened earlier this evening for their sneak peak of innovative offerings at CES Unveiled: The Official Press Event of the International CES which will be heard round the world for months ahead. See the future at CES January 8-11 in Las Vegas.

Best of Innovations, the much coveted CES 2007 Innovations Awards in Las Vegas, is an annual competition honoring outstanding design and engineering in consumer electronics products.

The biggest challenge at this time is sharing what we thought is truly innovative. Fun sure, but innovative? Coming away a bit disappointed, perhaps our expectations were too high.

Each item we saw, was an innovation at the time it came out, and thus being recognized. Individuals representing the various companies, when asked often did not have the product we wanted to see, as they will be unveiled within the next couple days during the press conferences here at CES, often considered the launch for consumer electronics.

Numerous companies which have received Innovations honors which we came specifically to see, were not available for viewing on the floor.

What we did discover were young companies introducing products and established companies showcasing new products.

Battery-Biz Inc, www.battery-biz.com, claims to combines the three most popular iPod accessories into one package - wirelessly transmitting music from any FM radio within range, extended battery time, and a protective silicone case.Celestron,

Eclipse Car, www.eclipse-web.com, combines a portable audio/navigation system with an Eclipse superior sound system with a TomTom portable navigation system.LG Electronics, Inc.,

Novint Technologies Inc., www.novint.com, promises to be a fantasy for gamers. It makes high-fidelity three-dimensional interactive touch possible allowing you to feel weight, shape, texture, dimension, 3D motion and force effects when playing their exclusive enabled games. Preorders are being accepted beginning January 8^th with units shipping in June 2007. Seamless Internet,

If you’d like to review a listing of all the honorees, search MBN for CES Innovations.