In the mid-1990s Microsoft began to expand into the media, entertainment, and communications industries, launching MSN in 1995 and MSNBC in 1996. Also in 1996 Microsoft introduced Windows CE, an operating system for handheld personal digital assistants (PDAs). In 1997 Microsoft paid $425 million to acquire WebTV Networks, a manufacturer of low-cost devices to connect televisions to the Internet. That same year Microsoft invested $1 billion in Comcast Corporation, a U.S. cable-television operator, as part of an effort to expand the availability of high-speed connections to the Internet.
In June 1998 Microsoft released Windows 98, which featured integrated Internet capabilities. In the following month Gates appointed Steve Ballmer, executive vice president of Microsoft, as the company’s president, giving him supervision of most day-to-day business operations of the company. Gates retained the title of chairman and chief executive officer (CEO).
In 1999 Microsoft paid $5 billion to telecommunications company AT&T Corp. to use Microsoft’s Windows CE operating system in devices designed to provide consumers with integrated cable television, telephone, and high-speed Internet services. Also in 1999, the company released Windows 2000, the latest version of the Windows NT operating system. In January 2000 Gates transferred his title of CEO to Ballmer. While retaining the position of chairman, Gates also took on the title of chief software architect to focus on the development of new products and technologies.
In 2001 Microsoft released a new operating system known as Windows XP, the company’s first operating system for consumers that was not based on MS-DOS. The same year the company also released Xbox, its first venture into video-game consoles. Microsoft announced a new business strategy in 2001 known as .Net (pronounced dot-net). The strategy sought to enable a variety of hardware devices, from PCs to PDAs to cell phones, to communicate with each other via the Internet, while also automating many computer functions. Confusion over the term .Net led to the adoption of the slogan “seamless computing” in 2003.
Other major business developments in the early 21st century included new versions of the Microsoft Network and the development with several major computer manufacturers of the Tablet PC, a laptop computer that featured handwriting-recognition software and a wireless connection to the Internet. In 2003 the company began to focus on “trustworthy computing,” requiring its programmers to improve their skills in protecting software from malicious hacker attacks in the form of computer viruses and worms. In 2004 Microsoft sold its innovative online newsmagazine, Slate, to The Washington Post Company, ending an experiment in online journalism that began in 1996 under editor Michael Kinsley.