*Gates Demonstrates Future of DRTV Marketing

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SAN JOSE, CA--Microsoft chairman/CEO Bill Gates wowed the audience of attendees at Streaming Media West yesterday with a keynote presentation that demonstrated new applications for streaming media, including direct marketing.

Streaming describes a technology to send audio and video signals through the Internet in real-time. The techology is expected to play a key part in transforming the Internet from a text-based medium into one with rich multimedia elements.

While Gates dedicated most of his time to demonstrate new multimedia features that will be included in Windows 2000 and Millennium, he also discussed business applications for marketing.

"Streaming is a great marketing tool," Gates said. "When someone wants to look up a product, you can have up on your site a streaming media-type of presentation."

He said the streaming media application for marketing is very limited now, with about 9 percent of companies surveyed using it for the purpose of a sales presentation. He cited Hewlett-Packard Corp., Palo Alto, CA, as one company that has taken an early lead in using the technology in a business-to-business sales context. H-P's site allows a sales rep to offer a video and audio presentation of a product and get immediate feedback from customers about its features.

"H-P has one study that showed this application is already saving on travel costs," Gates said.

Gates was joined on stage by Dave Fester, a Microsoft executive who demonstrated how targeted ads could be placed in streamed content. Combined with a database technology to profile the Web content preferences of a consumer, streaming can be used to send commercials to the right audience. The profiling technology was developed by Engage Technologies Inc., Andover, MA, which is majority-owned by Internet holding company CMGI Inc.

"Based on what it knows about my preferences for sports programming, it will send me an ad for Gatorade," Fester said. Not included in the demonstration was a method for users to click on the streamed ad and respond to it immediately.

About 8,000 people are expected to attend the three-day conference, which features 200 speakers and 125 exhibitors.

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