MediaFile

Robbie Bach, President of Microsoft’s Entertainment and Devices Division, sat down to talk to Reuters at CES in Las Vegas, ahead of the big keynote address by CEO Steve Ballmer. Topics discussed ranged from the Windows 7 beta and eventual launch, Microsoft’s mobile search deal with Verizon, and how the tough economic environment is affecting the company.

What is the status of Windows 7? Is it still on track for its launch debut?
It’s absolutely on track for the debut that we won’t tell you the date of. Three years from the last one. (Vista shipped in the fall of 2006 to businesses, and early 2007 to consumers). The date has some range in it for that reason. It’s a very good product.

What have you learned from the ups and downs of the Vista launch?
We learned that people’s early experience with the product when it ships is important. Initially when it shipped, we didn’t have as much compatibility as we would like. And that frustrated some people early on. That’s all gone now. But certainly with Windows 7 we want to get that right from the start.

How has the economy’s problems affected Microsoft plans?
The economy is going through a reset. There is no question about that. In the short term that means that every business is having some impact. Our general approach is to say that this is a reset, we are going to manage through that and come out the other end of that reset a much stronger company with a great product lineup. And you are going to see us continue to invest in technologies. But (we have) tremendous optimism about where the market is going and what the opportunities are over the next 5 years.

There are rumors out there about job cuts at Microsoft. What can you say about that?
We are not gong to comment about rumors. We will see how that plays out. You will see how that plays out in the market.

Does Ivan Seidenberg, Verizon’s top executive, fancy himself the next media mogul with a pro-sports team, a la Mark Cuban, the Dolan family and Paul Allen?

He hinted as much at the Dow Jones Media and Money conference  conference in New York. The trouble is the team he mentioned — The New York Knicks — are owned by Cablevision, a chief rival of Verizon. So pretty much kiss that idea goodbye.

Seidenberg hinted at the very, very unlikely possibility of buying the Knicks during a back and forth at the conference Michael Burgi of MediaWeek. Burgi asked Seidenberg to discuss his “content strategy.”

Media companies aren’t the only ones who needed Google’s help. The Wall Street Journal is reporting Verizon and Google are nearing a wide-ranging agreement that will see Google as the default search provider on Verizon handsets.

It’s not the first time the two have reportedly come close to landing a partnership. They were in discussions last year as well. 

At issue, according to the report, is Google’s desire to save information from user searches in order to enhance the relevancy of its ads. Verizon, like other carriers, have been unwilling to part with such valuable consumer data. Another hang-up is the revenue split from the ads.

It’s been a rough few weeks for cable operator Comcast Corp. U.S. regulator FCC is on the verge of punishing it for allegedly fiddling with subscribers’ use of peer-to-peer services like BitTorrent while New York Attorney General Andrew Cuomo is threatening to sue if Comcast doesn’t agree to join other Internet service providers to block access to child pornography.

But the largest U.S. cable operator is hoping to win over its customers by offering a free Nintendo Wii to new subscribers to its Triple Play package of video, Internet and phone.

The national free Wii offer runs from Monday till August 17th for new subscribers who have to agree to sign up for two years to one of Comcast’s premium Triple Play packages: Preferred Plus (at $129 a month) and Premier Triple Play ($159 a month).

Verizon’s new fiber optic (FiOS) TV service added fewer subscribers this quarter with just 176,000 compared with 263,000 in the first quarter. This  surprised some analysts who had expected FiOS to continue its same rapid pace of growth, backed by Verizon’s huge marketing spend and aggressive push.

But Verizon Chief Operating Officer Denny Strigl (pictured)  told analysts the slowdown in FiOS TV growth was explained by the end of Verizon’s popular promotion giving away free high definition television sets.

On the plus side, not giving away TV sets helped keep mounting subscriber acquisition costs under control thereby boosting its bottom line, the No. 2 U.S. phone company told Wall Street.

Pali Research analyst Richard Greenfield downgraded Time Warner Cable on Monday with one eye on Verizon’s launch of FiOS TV in New York (You have to register to read the link).

Verizon got approval to roll out FiOS TV just last week and is expected to begin installations as soon as August. Reuters ran an analysis last week that showed that Verizon’s roll-out of FiOS will be expensive for the phone company and its cable competitors, particularly Time Warner Cable.

Greenfield said New York City represents only 10 percent of Time Warner Cable’s subscriber base, but its average revenue per user is well above average.

So who’s winning the pay-TV so far this year? With days to go until two of the biggest cable operators (Time Warner Cable on Wednesday and Comcast on Thursday)  report first quarter financial results, Reuters canvassed eight Wall Street analysts for their estimates of subscriber net additions during the period.

At first glance it doesn’t look like it will be a good quarter with these analysts forecasting Comcast, Time Warner Cable and Cablevision to lose around 100,000 basic TV subscribers collectively, while satellite TV plays DIRECTV Group and DISH Network will add around 320,000.

Even more worrisome for cable companies?  AT&T and Verizon added around 410,000 new TV subscribers between them during the quarter.