Today [Thursday] Microsoft and its partners pitched Windows XP to their users, but struggled to appear convincing.

Apparently, digital home entertainment is the new killer app.

Executives from Microsoft, Intel and Dixons, among others, did their best to convince an audience of IT professionals that the platform they should be rolling out in corporates and pushing to consumers is Intel Pentium 4 (2GHz, please) and Windows XP. Why? Digital pictures, video and music.

It's not that the audience didn't think the new Windows XP interface is easier to use: it blatently is. Or that they don't believe the promises of it being 13 times more stable and 38 per cent faster than Windows 98.

They just don't like the baggage that comes with it - increased licence costs and product activation being the main bugbears.

Asked by Channel 4 news presenter John Snow whether product activation was simply a nuisance technology, Ballmer replied brightly: "Ummm, no. Not at all. It does a few things but it only involves those copies bought at retail or by small businesses, not corporate customers... it is designed to remind people what their licence allows."

Ballmer also fielded a question from Snow on licensing costs, and promised Microsoft would continue to listen to complaints. He said: "We've had a lot of customer feedback on this, particularly from you guys in the UK, a lot of feedback."

Read more Ballmer here.

Intel's John Woodget, UK and Eire managing director, argued that increased security and encryption require more processing power and that digital cameras, digital video, and ripping MP3 files to CDs would drive adoption in the home, then it would filter through to business.

He compared this with computer games and the internet, the two apps which he said had driven the need for increased processing power and functionality in recent years.

Woodget said that those who claimed home users did not need more power from their PCs were ignoring the lessons of history. Quoting remarks by a London school of business professor, he said: "Those that live by the sword, get shot."

Read more Woodget here.

David Hamid, chief operating officer, retail operations, at Dixons, said: "XP and Pentium 4 give people a reason to upgrade their PCs."

Over 1000 models of PCs, totalling some 30 million units, have been made Windows-XP ready.

Whether XP can boost the current market, however, is another matter.

Chris Ayres, desktops product marketing manager at Dell, said that all new Dell PCs would have Windows XP as the default option, but that he expected only around 50 to 60 per cent of new PCs sold to run XP.

He said he thought corporate customers would be still more cautious, with only around a fifth choosing XP in the next few months.

Ayres added that this was not due to current market conditions, but simply the desire to wait and see how XP panned out for its early adopters.

He said: "They're simply waiting for XP to prove itself."