This is a copy of a page from Google cache, the page it was originaly on is no longer there and I’m posting it because it helped me today and I’d hate for it to be lost.
Steps to transfer video from Sony HC40E Handycam and Sony HC42 to an Windows XP PC:
Make sure that you have installed the USB driver for the handycam. You can download the drivers from this link: Sony Asia Pacific Support Website–Download Page for HC40E USB Driver for Windows.
Connect the handycam to the AC adaptor (the same as putting it on charge).
Set the handycam to USB stream mode. (Press P-menu, press MENU, Press EDIT/PLAY, Press USB-PLY/EDT MODE, Press USB Stream.)
Set the tape at the point from where you want to start capturing in PC.
Connect the handycam and the PC with the USB cable. (USB-Mode appears on the handycam LCD / viewfinder.)
Start Windows Movie Maker. Click on the ‘Capture..’ link to start the wizard.
Select the Sony Digital Imaging Device. Click Next.
Specify the file name and path for the capture video. Click Next.
Select the desired capture format and Click Next. (Leave it to recommended setting if you are not sure.)
The dialog box now displays the Start Capture and End Capture buttons on the left and preview window on the right.
Play the tape on the handycam. The video from handycam should appear in the preview window of WMM.
Click the Start Capture button to start capturing the video. Click End Capture to pause or stop recording.
Click the Finish button. The .wmv file will be saved in the path specified in step 7.