The new software has bought a sigh of relief from PC companies who’re struggling to add value in a market of shrinking margins, where relatively high performing machines are now selling for under $1000. This software will shift the focus back up to the higher end of the market where processor performance, top of the line graphics and video cards, big memory and 200Gb plus disk capacity is required.

What you’ll increasingly get as the market matures is a box that looks at home alongside the DVD or component hi-fi system, or in fact replaces some of those devices. The package will come with a remote control unit that allows you to switch between normal computing functions and Media Centre.

With its DVD burner you can back up photos, music, TV shows and home movies and even edit TV and video content with Windows Movie Maker 2.1. It can synchronise your music collection to over 75 portable music players with Windows Media Player 10.

Through a USB connection you can add anything you like from a wireless keyboard to additional hard disk or digital still or video camera. Through wireless or Ethernet network connections you can point to the music or video files on another computer and play them through your home sound surround hi-fi system.

Local broadcasters have however denied Microsoft access to the electronic programming guide (EPG) for automated TV scheduling. Users in the US already use the EPG to automatically select and record broadcast content. Initially local users will have limited access to Discovery Channel and Reuters live news feed over fast internet, although there may be charges. There are plans for a couple of local ‘consumer-related’ channels via a US-based server.

Hewlett-Packard which led the way with the first Windows Media Centre equipped PCs last year has refined its approach. The silver and grey Pavilion machines will be more affordable at $2999 including a 19 inch LCD monitor and bundled PhotoSmart printer and HP digital camera. It’ll retain the slot for a portable hard drive, and the high end machines will feature a dual core processor, so more intensive tasks can be performed in parallel with a quicker refresh rate.

The HP version of Media Centre features HP Tunes, an iTunes derivative optimised for viewing on the TV screen to download and manage music files. HP Image Zone for storing, filing and manipulating photos is also part of the package.