Steve Ballmer kicked off the Streaming Media West event in San Francisco, outlining Microsoft's next generation of media software applications. Ballmer, Microsoft president and CEO, touched on the important role he believes media will play in keeping the PC central to consumer and corporate computing. "The digital media phenomenon is one of the engines that will fuel increased activity and excitement around the personal computer," he said, during the event's opening speech. Microsoft's Windows Media Audio and Video 8 are key to Microsoft's entertainment and media services plan. Ballmer showcased features in the Media Player 8 beta - due out with the operating system code named "Whistler" at the end of next year - such as file compression technology that allows users to store more compressed media files. Ballmer claimed the new format allows users to store three times as much music as the current MP3 file format. "Two years ago we were at version 4, and now we are at version 8," Ballmer said. "I guess this industry is moving pretty quickly." While the finished version will wait for Whistler, users can start using the beta of Windows Media Audio and Video now. Content providers and large corporations are expected to use the latest version of the software. For content providers, compression technology in version 8 could prove effective for delivering media even when bandwidth is sluggish. Ballmer claimed users will receive both higher quality sound and near-DVD quality video at lower connection speeds. Just as the current version of Windows Media automatically downloads artist and song information for a user's CDs, the new media software will download far more extensive information on performers, including album cover art, new album releases, artist biographies and links to related content. The Media Audio and Video application is intended to serve as a starting point for Microsoft's entertainment products suite. Ballmer emphasized the importance of Microsoft products - the Xbox gaming console, WebTV, smart phones and wireless devices - working together. Like other vendors in the streaming market, Microsoft also has its sights set on corporate users where such applications can be used for training, delivering information and educating employees. With this in mind, Ballmer showed an enterprise edition of Movie Maker allowing users to pair video and audio with Power Point presentations. Using drag- and-drop technology, an executive can annotate a presentation and send it around to a number of colleagues. "A lot of people think of digital rights management as just an issue for the music or movie industry," Ballmer said. "If I send a piece of email to a set of people at work, maybe I include my voice angrily yelling, 'I can't believe we did this. Blah, Blah.' I might not want anybody else except the people I sent it to to see that comment." Microsoft added some security features to its media applications to avoid some of the controversy brought on by music swapping company Napster Inc., Ballmer said. When making a media presentation, a user can govern the set of recipients and make sure they don't forward it throughout or outside of the company. Microsoft also has teamed with Kenwood on a portable CD player using the new Windows Media Audio 8 format. Ballmer claimed users can use a CD burner to make a single CD that contains more than 22 hours of music. The Kenwood DPC-MP727 Player will come out in the second quarter of 2001 in Japan Ballmer also highlighted a deal with Japan's NTT DoCoMo in which NTT will deliver Windows Media over wireless devices. NTT's Eggy device made an appearance on stage as one example of the Media Audio and Video player in the real world. Eggy allows a user to wirelessly watch videos and to film video clips via a camera mounted on the wireless device. Eggy started shipping in Japan last week and should arrive in the US in one to two years. Microsoft additionally forged deals with Compaq, HP and Casio, making Windows Media Player 7 available for the vendors' PocketPC handhelds. Users can download video clips, Windows media and MP3s from the Web to their device. "Some ask whether there is still room for improvement with media technology," Ballmer said. "This is a technology area that is very young. The ease of use still is not there. We are far from what this industry can realize."