NEW ORLEANS -- April 25, 2000 - Bill Gates, chairman and chief software architect of Microsoft Corp., painted the vision of an exciting future for the personal computer Tuesday during a presentation to 3,000 industry partners at the Windows^® Hardware Engineering Conference (WinHEC) 2000. Gates unveiled what he called a "concept PC" that included innovative features he said would become standard in the near future and could serve as a platform to test new user interfaces and future versions of the Microsoft^® Windows operating system. In addition, Gates noted that the PC architecture is poised to become the foundation for new kinds of embedded appliances and devices.

"Very soon, even the most basic PCs will have video cameras, noise-canceling microphones and wireless peripherals," Gates told those attending the conference of Microsoft's hardware partners. "The extraordinary pace of innovation in PCs isn't going to slow down -- it's just going to increase. And that's tremendously good news for consumers, whether they're business users or PC gamers."

Gates' presentation focused on innovations facilitated by the breadth of Windows solutions. He detailed Microsoft's emerging strategy to enable the next generation of smart devices based on Windows technology and demonstrated how the Windows architecture will enable easy connectivity between these devices, PCs and the Internet. The environment created by this architecture will allow information, pictures, music and services to be easily shared.

During Gates' keynote, the role of Windows 2000's reliability and scalability as key enablers for the convergence of voice, video and data networking was demonstrated during an on-stage phone call between Gates and Cisco Systems Inc. CEO John Chambers, using Cisco's recently announced IP phones and CallManager version 3.0, an intelligent IP telephony application that utilizes Windows 2000 technology.

Gates also demonstrated the Compaq eight-way systems running Windows 2000 Advanced Server that was used to set the world record Transaction Processing Performance Council (TPC) benchmark at the launch of Windows 2000 and gave the first public demonstration of the prerelease version of 64-bit Microsoft SQL Server™ running a prerelease version of 64-bit Windows 2000 on an Intel Itanium-based system. This demonstration showed the tremendous scalability achieved by the potent combination of state-of-the-art Intel-based servers running Windows 2000, SQL Server 2000 and the PC architecture.

Gates' comments about the future of the PC were in direct contradiction to industry pundits who contend that the PC era is waning and that the PC has seen its best days. "Not only are PCs selling in record numbers today, but we are on the verge of some exciting innovations that will make the PC an even more vital hub to the future of computing," Gates told those attending the three-day conference and trade show. "In fact, we are entering an era in which the PC will become more central to our everyday lives, an era that we call the 'PC Plus.'"

In describing Microsoft's vision for the future of the PC, Gates acknowledged that there are a number of things which need to be improved, including its complexity, limited form factors and general-purpose nature. Gates previewed a number of innovations aimed at addressing those issues. Microsoft also provided developers with a detailed road map for Windows, including Microsoft's significant investments in Windows embedded operating systems for 32-bit connected devices, leading the expansion of the Windows personal computing platform into a wide range of intelligent systems.

Gates also showcased upcoming Windows platform innovations, including the announcement of the release candidate of Windows CE 3.0, extending the functionality and flexibility for smart devices. New features include improved real-time support, rich multimedia functionality such as the DirectX^® API and Windows Media™ technologies, enhanced Internet capabilities and DCOM for Windows CE. These features enable developers to create highly customizable devices while reducing their time-to-market.

Attendees were left with a sense of the expansiveness of Windows as a platform for innovation. From handheld devices to mission-critical enterprise operating systems, Windows enables a the broadest and most complete range of computing in the industry.

"We have come a long way for sure," Gates said. "But as you can see, we really are only at the beginning of the potential for the PC. Truly, the best is yet to come."

About WinHEC

WinHEC is an annual gathering of 3,000 engineers and product planners from the hardware industry who develop components and systems for Windows. At WinHEC, engineers share information and proposals to improve PCs and jointly solve technical and user problems. Prominent at this year's WinHEC discussions are technologies such as Universal Plug and Play (UpnP), Institute of Electrical and Engineers high-speed serial bus standard (IEEE 1394) and Universal Serial Bus (USB) 2.0. Innovations such as Plug and Play, the Microsoft-led open industry specification for connecting PCs and smart devices, now significantly supported by members of the UPnP Forum, were first proposed at WinHEC.