Bill Gates touts Vista

In interview with CNN's 'American Morning,' Microsoft's chairman tells viewers why they should upgrade to Vista, dismisses comparisons to Apple's OS X.

By Paul R. La Monica, CNNMoney.com editor at large

NEW YORK (CNNMoney.com) -- Microsoft chairman and co-founder Bill Gates boasted to CNN that Vista, Microsoft's widely anticipated new version of its Windows operating system, will make the personal computer the "place where it all comes together" for multimedia applications such as photos, music and videos.

Gates' comments were from an interview on CNN's "American Morning," which aired Tuesday to coincide with Vista's release. (see the interview)

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Microsoft chairman Bill Gates told CNN"s "American Morning" that its new operating system will make it a lot easier for consumers to manage photo and video files.
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Vista is the first update of Windows since Windows XP was released in 2001. Microsoft (Charts) invested $6 billion to develop Vista, Gates said.

"People are using Windows PCs more than they watch TV now," Gates said. " A big release of Windows was needed. We put a lot into this one."

Gates explained several of Vista's key new features, including controls that let parents monitor what Web sites their kids have viewed as well as the time spent on the computer.

Gates also showed some of the features for editing digital photos and videos. "We're making the PC the place where it all comes together," Gates said, adding that people using Vista will be able to view content from their computer on their TV.

Gates bristled at the suggestion that Vista had some similarities to Apple's (Charts) OS X operating system for Macs. "No no no. There are whole areas where we've innovated," Gates said during the interview.

Some tech experts have suggested that consumers do not need to upgrade to Vista if they did not plan on buying a new computer within the next few years.

But Gates said that it is relatively easy for people to upgrade from XP to Vista as long as they have bought a computer recently and that it would make sense to upgrade in order to enjoy the operating system's new features.

"If you are not going to buy another machine for another few years why should you not get the benefits from all the richness here?" he said.

The company plans to spend $500 million to promote Vista, a figure that one analyst said was probably a record for the company but not "shocking."

"I'm sure this is the most they've ever spent launching a new product," said Rick Sherlund, an analyst with Goldman Sachs, adding that Microsoft will probably have marketing help from PC manufacturers, such as Dell (Charts) and Hewlett-Packard (Charts), who will be seeking to sell new machines that run Vista.

CNN's Katy Byron contributed to this story.

Goldman Sachs' Sherlund does not own shares of Microsoft but his firm has done investment banking for the company.

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Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.