CES: Showcasing the Battle for Content

As the first of my three-part report on this year’s Consumer Electronics Show, I’ll focus on the big companies and a number of the cool products that were announced early in the show. Next week, Part Two will loop in the late announcements and contrast what happened at MacWorld the following week. In Part Three, I’ll point out what vendors are missing in their pursuit of Consumer Electronics opportunities.

Microsoft: It’s All About Vista

Bill Gates had the enviable position of setting the initial tone of CES as the first keynote speaker the night before the show actually started. He began his speech the way all keynoters should but seldom do — he presented his vision of the future. He framed this vision with demonstrations of future technologies that are actuallay closer to reality than most think.

In his demonstration he started with the home, showing a vertically mounted display — about the size of a current 42-inch plasma screen — that responded to touch. Via this screen, with a Windows Vista-like interface, he was able to monitor the weather, check (via GPS) on the location of family members, track a variety of news programs and monitor his commute traffic.

This system synchronized with his cell phone, which appeared to be the new Microsoft Mobile-based Palm 700 — meaning he could just grab the phone and have it direct him around traffic (also via GPS) while on the way to work in the car.

His “work” demo included a desk with three large glass panel displays with touch sensitivity. He showed how one could set up a video conference call, automatically linking to information associated with each speaker (background, presentation material).

He also showed how he could dynamically change the mix of folks on the call based on breaking news, which was displayed on another screen. While mock presenting during this conference call, he took what appeared to be a shipping tablet computer and used it to drive his portion of the presentation from a comfortable angle on his desk.

Finally, for the weakest part of the demonstration, Gates used a display built into an airport coffee table to showcase how, when traveling, he wouldn’t need a laptop but could use one of these shared displays to expand the view typical of a cell phone, therefore getting a large experience on a very small device.

Few realized that much of what he showcased will be possible with Windows Vista and related platforms that will be shipping at the end of the year. Most present at the presentation assumed the technology was years out — and that suggests what could be an interesting surprise at the end of the year.

Taking Shots

After a demonstration of Windows Vista, Gates invited MTV executives onto the stage where they announced their new music service. As expected, there was a subtext to the announcement that suggested this service would not work with Apple, something that became a recurring theme.

Unfortunately, another recurring theme was inviting actors and artists onstage who appeared to be unclear as to why they were actually there. In this case, the appearance of Justin Timberlake had many questioning whether Gates and Microsoft were living in the wrong decade. As it turned out, however, MTV had selected Timberlake. This does not bode well for MTV’s music service. Recall, after all, that Apple had U2. No comparison.

In closing, Gates took shots at Sony by showcasing the success of the Xbox 360, which is — despite reports of quality problems — doing well everywhere but in Japan. He announced an HD-DVD accessory for the device that will offset Sony’s Blu-ray drive; this was one of many stakes driven into the heart of Blu-ray during the show.

Gates also took a strong shot at Apple, showcasing several iPod-like devices, the strongest being a new handheld video player from Toshiba that will work with the new Starz online movie subscription service. Finally, Gates showed off the Vista version of Microsoft’s Media Center. Users will be able to rip HD-DVDs and move that content around the home with the platform, as well as take advantage of a variety of new subscription audio and video services that don’t work with iTunes.

Sony and Intel: More Product than Vision

Sony and Intel assumed more tactical positions. Sony’s CEO promised he would finally get Sony’s own products to work together and didn’t mention a thing about the rootkit mess they created under his leadership last year. That didn’t keep many of us in the audience from remembering the incident. Sony also showed how its connection with content would allow the company to leap ahead of its competitors (read: Apple) and take the consumer electronics market back. From my perspective, Sony has always had this capability but has been unable to get out of its own way to execute.

Here, too, actors were put on stage, this time to talk up Sony’s high-definition DVD standard. What stood out to me was the new eBook — the first product of its type that really looked compelling. Some folks I know in Japan have raved about it, so Sony could have a winner here. The company clearly seemed to understand that the success of this product will have as much to do with content as with the technology.

Intel focused a huge amount of attention on actors, with the largest number of any company at CES. More was not better, however. It was painfully clear that most of these folks didn’t seem to understand why they were there or know what to say.

What their presence did indicate, though, was that Intel understands that the next generation of home technology will be about content. The company has lined up an impressive number of content deals, including one that promises home availability of some films at the same time they are being released in theaters.

Intel showcased its new Viiv platform with strong support from the hardware OEMs — Viiv-compliant systems were unveiled by a number of major vendors. However, Intel’s recent re-branding was not being well received, and its new tagline, “Leap Ahead to the New Normal,” had many of us wondering what the heck they were thinking.

It is interesting to note that each of the hardware OEMs I spoke with at the show indicated that its AMD commitment was going to increase next year — which will clearly be problematic for Intel. As a side note, while at the show, I got mail indicating that Dell had begun advanced development on an AMD-based server.

AMD and VIA: Counterpoints

AMD launched its lower profile “Live” program, which takes technologies from a number of vendors, to create a “best of breed” Viiv competitor. AMD didn’t have a stage presentation and was largely riding on the coattails of Intel and Microsoft. However, Microsoft was clearly favoring AMD, a trend many have noticed for some time now, and that suggests some interesting things will be happening this year. Several of the coolest handheld video products were based on AMD’s technology, which allows full resolution video playback.

VIA showcased systems that come closer to the price points that the consumer market seems to favor. The coolest was the DualCor, a handheld computer that operates in dual modes, booting either the Microsoft Mobile 5 platform or Windows XP while utilizing the same storage repository.

With a panoramic screen and a size that makes it truly portable, it was one of the most innovative products I saw at the show. This got me thinking that many may be getting so focused on technology they are forgetting that the consumer just wants stuff to work. Some are concerned that the industry is now doing more to confuse than entice customers. The VIA-based products, in particular, seemed more about the consumer experience than what was inside.

As a matter of fact, I moderated a panel on consumer confusion at the show, and we couldn’t help but contrast Apple’s approach to what we were seeing from other vendors. Apple focuses solidly on the consumer experience, and way too many of the other vendors seem entirely too focused on the technology. I will cover this in more depth in Part 3 of this series. Now let’s talk about some cool products coming out this year.

CES Products to Lust For

The Hush Media Center PC: Hush makes a zero-noise Media Center PC in an aluminum case that looks like art to me. It is fanless, and its clean design looks like something Apple would build. Starting in the mid-thousands of dollars, it isn’t cheap, but it isn’t excessively expensive either — and it sure looked good.

Sonare Technologies Babble: Years ago, there was a TV program called “Get Smart” — a spoof on James Bond. In this program, there was a device called the “Cone of Silence” that was supposed to make conversations private. Instead, broadcast them, and prevented the people talking from hearing each other. The Babble does what the Cone was supposed to do — it surrounds speakers with an audio barrier making their conversations private. This just struck me as cool, which probably means I’m way too geeky for my own good.

Media Center Communicator: This product allows you to use voice commands with your Microsoft Media Center computer. With all of the noise in the room, it was interesting to note that it emulated a spouse — in that it seldom did what it was asked to do at the show. This can be a clear problem when you are trying to demonstrate an audio command product where there are lots of people talking at the same time.

The Linspire Mini: A dead knock-off of the Mac Mini costing around US$400 and having a rather rich bunch of applications. Using the A-Open platform, which also runs Windows, this was actually one of the best shots at Apple at the show — and Apple clearly was the designated target this year.

The Infill In-Car PC: CES has a lot of really wild automotive products. In fact, many of us just wander through that section with a dazed, lustful look in our eyes. The coolest thing was a full Windows XP PC with automotive media front end that fit in the dash with a motorized screen that powered out. Supporting multiple monitors for a full entertainment experience, this was a car modder’s dream come true.

Philips AmbiLight 360: This may seem weird, but what makes this plasma screen different is a light that shines behind the screen that changes colors based on what is displayed. The end result is surprisingly impressive, and a surprising number of us walked out the related presentation lusting after this product.

Hillcrest Labs “Loop” UI and Remote: This has to be the coolest remote control and user interface yet. Tied to the Intel Viiv platform, this was one of the single most innovative products at the show. While you can get lost in the technical description of this thing, it was gorgeous to look at, intuitive to use, and was one of the products that clearly showcased the advantages associated with a Media Center approach to home entertainment.

Norcent Plasma and LCD Displays: I like a bargain, and these were good-looking displays for incredible prices. One example was the high-end 50-inch High Definition Plasma that will have a suggested retail of around $3,500. To put this in perspective, Pioneer launched its own high-end 50-inch plasma and priced it at $10,000.

Sanyo HD1 HD/5 Megapixel Hybrid Digital Camera: This camera records MPEG-4 HD film and high definition stills, and costs under $900. One of the first to have a large OLED display as well, it was a showcase of cutting-edge technology and the first HD camera priced under $1,000.

Wrapping Up

Overall, CES was a massive showcase of products — good and bad — that will be hitting the stores starting in a few weeks and continuing into the next holiday season. Most of these products are much improved over their predecessors and many are blatantly attacking Apple market positions. Apple will be firing back shortly — and it never is wise to sell Steve Jobs short. Many think, though, that this will be a much tougher year for the company.

The theme at CES was largely about content: who has it, how you will be able to get it, and what you can do with it. The vendors that manage content best will likely win their respective segments.

Next week, I’ll talk about Google’s strike at the digital home, compare CES with MacWorld, talk about Blu-ray’s CES failure and cover another group of products announced at the show — including one of the coolest desks I’ve ever seen.

Rob Enderle, a TechNewsWorld columnist, is the Principal Analyst for the Enderle Group, a consultancy that focuses on personal technology products and trends.

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