(FORTUNE Magazine) – IN 1628, KING GUSTAVUS II Adolphus of Sweden ordered the launch of the most powerful and technically advanced warship that had ever been built, the Vasa. Bands played, flags fluttered, and the entire city of Stockholm watched as the lavishly equipped Vasa glided into the harbor, set sail--and tipped over and sank. Some 50 souls were lost, but the captain swam ashore and crawled straight to a tavern.

By those standards, the launching of Microsoft's new MSN TV 2 Internet & Media Player is a grand success.

Microsoft has been trying for years to create a simple appliance that plugs into a television to let TV lubbers (and PC haters) gain easy and inexpensive access to e-mail, instant messaging, and other Internet services in the living room. The MSN TV 2 Internet & Media Player ($200, plus monthly MSN subscription fees) is the latest such device, and while it doesn't exactly sink, it doesn't really go anywhere either. It's like a ship sailing in circles, trying to catch the opposing winds of simplicity and multimedia usefulness. On the other hand, despite a few curious quirks, it does manage to float e-mail, web pages, and digital photos onto a television screen, and for some people--older folks, if the technophobic stereotype is to be believed--it may be a good enough alternative to a PC.

The MSN TV 2 Internet & Media Player is a plastic box about the size of a chubby notebook computer. It's intended to sit on or next to a television and to connect to the Internet through either a broadband cable or DSL connection or an ordinary dial-up telephone line. It comes with a wireless keyboard and remote control and uses the TV screen for displaying e-mail, instant messages, digital photos, web pages, and (for broadband users) videoclips from the MSN online service. It also uses the TV's speakers for playing digital music, either from Internet radio stations or the owner's existing digital music collection.

Of course, you can do all that and more with a real computer, but lots of people have avoided computers because of their cost and complexity. So even though it uses the Windows CE operating system and has an Intel Celeron microprocessor, 128 megabytes of system memory, an Ethernet port, two USB ports for connecting peripherals like printers and memory-card readers, and a 56K modem, Microsoft does not call it a computer. "Internet & Media Player" sounds, well, more playful.

And therein hangs its albatross.

The Player is intended for computer novices, but its best features require a broadband Internet connection, a local area network, and a separate Windows-based computer. People who have resisted using a computer until now probably don't have a stash of digital music, photo, and video files or a strong desire to configure home networks, and this system hardly encourages them to dive deeper into technology. More experienced PC users, however, the kind who can rig a wired or wireless local area network and rip digital music onto a PC, will find the MSN TV 2 Player interface overly simple, to the point of frustration.

The Player is designed to be inexpensive, but it achieves its relatively low cost by throwing overboard such useful cargo as a hard-disk drive and a mouse. Entry-level PCs with far more capabilities are available for a few hundred dollars more, and a good used PC compares quite favorably.

There is some appeal in using a big-screen TV as a PC monitor, however, especially for displaying digital photos on a large scale. Thomson, which makes the MSN TV 2 Player under the RCA brand, has improved the quality of text messages displayed on the television screen, and the wireless keyboard has a button for enlarging text to make it easier to read at a distance, but e-mail is still fuzzier than it is on a computer monitor.

That is, when it works. I tried all day to send or receive e-mail through the MSN TV 2 system, mostly getting error messages instead saying, "MSN TV has run into a technical problem" or "E-mail is not available, please try again later." A call to technical support yielded the helpful advice "Try again tomorrow." Eventually my e-mail started flowing once again, including the bilge known as spam. The good news is that the MSN service offers better-than-average junk-mail defenses, and they're easy to set up.

Then there's the curious issue of digital music. MSN TV 2 offers access to some 200 commercial-free Internet radio channels, but not all of them work. Harder to fathom is the MSN TV 2 Player's inability to play music that has been downloaded through a PC from MSN's own Music Store. The Player had no problem with PC-created MP3 files and tunes ripped into the Windows Media Audio format from CDs but choked on music bought from MSN itself. An MSN representative said the incompatibility arises from the digital rights management (DRM) copy-protection system employed by the MSN Music Store to fend off pirates. MSN says the embarrassing incompatibility will be fixed with a software update by year-end.

Most of all, the MSN TV 2 system suffers from the same problems that have torpedoed earlier television-based Internet systems: sluggish performance, an awkward user interface, and a lack of content that takes advantage of the technology.

Anyone who has enjoyed a high-speed, always-on broadband connection to a PC or Mac will find the "please wait" messages, even on the broadband-enabled MSN TV 2 Player, to be as welcome as scurvy. Similarly, anyone who has used a computer mouse will find the UP-UP-OVER-OVER arrow-key navigation of the keyboard or remote to be a throwback to an era before the graphical user interface. One of the nifty things about television is that--here's a revelation-- it does a nice job with video. With MSN TV 2, the featured video recently was a jerky, four-day-old TV news clip, hardly the compelling content we envisioned when we set sail for the new world of digital convergence.

The MSN subscription fee is $22 a month or $200 a year for dial-up customers, and $10 a month or $100 a year for users who connect through their existing broadband service. If you just want to send e-mail and digital photos to Grandma's television and don't mind explaining to her why she is getting bombarded with e-mail offers for Viagra, the MSN TV 2 Player is simpler to set up and operate than a Windows-based PC. If it were my grandma, I'd tell her to hop on her Vespa and ride down to the nearest Internet café.

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