Microsoft Unit to Market Consumer Electronics

Microsoft Corp. created a new division to focus on products that combine home entertainment and communications as the company tries to fuel growth by expanding outside the market for personal-computer software.

Microsoft's new eHome division will develop products that combine voice and messaging features with video, music and digital photos, said Mike Toutonghi, eHome vice president. He declined to give details of specific products or when they will be available.

The biggest software maker, which has done poorly with home products such as Web-enabled television services, is trying to combat falling sales of PCs by entering new markets such as networked electronic devices for the home.

Microsoft will face strong competition in an area where there probably won't be much consumer demand in the next several years, analysts said.