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Tuesday, August 30, 2005 - Page updated at 12:00 AM

Report has Microsoft opening NYC retail store

Seattle Times technology reporter

Microsoft may open a glitzy retail store in New York City's Times Square to raise its profile and showcase consumer-oriented products such as the new Xbox.

One possible site is a four-story space at One Times Square, a billboard-covered building where the famous ball is dropped during the New Year's celebration.

A retail store would dovetail with Microsoft's recent efforts to raise its profile in New York, an area that generates more than $1 billion a year in business-software sales for the company. New York is also home to the media giants Microsoft is courting with its software for distributing and protecting music, movies, games and television.

A store could also give Microsoft a more permanent location to pitch its technology.

It has recently used temporary product showcases, including mock home and office settings, to demonstrate products to big customers in cities such as New York and Paris.

But a store would be aimed mostly at the flood of consumers that flows through Times Square. A Microsoft store could counter the slick retail centers that Apple Computer and Sony use in New York and elsewhere to showcase their products and build their image as purveyors of cool technology.

With or without a store, Microsoft will spend hundreds of millions of dollars over the next year marketing its upcoming Xbox 360 game system, Microsoft-developed phone and TV products and new versions of Windows and Office launching late next year.

The Times Square plans were reported yesterday in the New York Post. A company spokeswoman refused to comment.

"At any given time, Microsoft evaluates and pursues real-estate opportunities and needs," spokeswoman Rachel Wayne said via e-mail. "Out of respect for all parties, and a desire to not perpetuate rumors, we do not have a comment on this at this time."

A broker representing One Times Square declined to confirm Microsoft's plans, but acknowledged that "that caliber of company" is interested in the 18,000-square-foot space.

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"It's a billboard retail location, it's where the ball drops," said broker Jeffrey Roseman at Newmark New Spectrum Retail in New York.

Where tourists flock

Roseman said companies such as Pepsi and General Motors have also expressed interest in the vacant space, which formerly housed a Warner Bros. store. He said one possible tenant is interested in displaying different product lines on each of the four floors in the space.

A store is unlikely to have much effect on Microsoft sales. Most of its software is sold indirectly through computer makers and technology vendors it calls partners.

But the company has tried in the past to buff its brand with a retail outlet. From 1998 to 2001, it operated the gallery-like MicrosoftSF store at the Metreon mall in San Francisco.

The store was managed jointly with Sony until Microsoft entered the game console business with its Xbox.

The New York project may give Chairman Bill Gates another thing to talk about when he has Hu Jintao, the president of China, over for dinner on Monday.

According to the same edition of the Post, one of China's largest real-estate companies is also shopping for space in Manhattan. Beijing Ventone Real Estate will use its space, perhaps at the rebuilt 7 World Trade Center building, to attract Chinese companies.

Brier Dudley: 206-515-5687 or bdudley@seattletimes.com

Copyright © 2005 The Seattle Times Company

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