Microsoft is attempting to close the gap on Adobe's dominance of online video by showing off the capabilities of its Silverlight video plug-in on NBC's Olympics site.

NBC's live video of around 2,200 hours of Olympic footage required the Silverlight plug-in to be played, and gave users the ability to watch up to four videos simultaneously, and listen to a commentary alongside the action.

While more than 40 million US viewers went to the site for their Olympic fix, Microsoft reported that nearly half of these visitors didn't have Silverlight when they arrived.

In an interview with Reuters, the company said it intends to expand its reach and close the gap on Adobe's Flash, which currently powers over 80 percent of web video and is running on most of the world's computers that have an internet connection.

Adobe strikes back

However, Adobe isn't taking all this lying down.

While it's always concentrated on providing developer tools for designing and creating content for the internet, Adobe is now planning to move into more traditional software development with tools such as its Flex development system.

Flex, while still a web application, offers desktop-style functionality for Flash, including buttons, drag and drop and no necessity to reload pages when new data arrives.

So while Microsoft moves from the desktop to the web with Silverlight, Adobe's strategy is to use its mastery of internet technology to bring the web back to the desktop.

"We have a large and established customer base. There is no doubt in our minds that Microsoft is going after this space very aggressively, but we feel very strong and confident," said Jennifer Taylor, director of Flash product development.