The DVD Insider had been busy over the past few months. Here are 3 more great stories to bring you up to date.

DVD Insider # 41 - Grokster Decision Great News?for Lawyers. Guns Don't Kill People? Blue Battle of

THE Insider

The DVD Insider had been busy over the past few months. Here are 3 more great stories to bring you up to date.

DVD Insider # 41 - Grokster Decision Great News…for Lawyers. Guns Don't Kill People… Blue Battle of Words & the Winner Is…

DVD Insider #40 - Optical Storage Update - Who Cares Which Blue? Will Compromise Occur? What Is Unsaid? What Do You Do?

DVD Insider # 39 - Computex, Apple Shift, InfoComm

by THE Insider
an industry marketing/communications expert with more than 15 years of video, storage and networking experience.

DVD Insider # 41 - Grokster Decision Great News…for Lawyers. Guns Don't Kill People… Blue Battle of Words & the Winner Is…

Grokster Decision Great News…for Lawyers

The Grokster vs MGM last month shouldn't have come as a big surprise to anyone last month even though lots of us clutched that faint ray of hope the Sony VCR ruling would help shield the industry. The surprise was the nine-zip decision. Granted most of the sitting judges are older than dirt. But anyone in the industry has to admit we've been saying "no…no" with a smirk and a wink way too long.

Of course the decision means we're going to have to do without those great ads. You know - Apple's "Rip. Mix. Burn" and Microsoft's "Swap Pictures, Music, Video and More."

The MPAA was smart because they picked two targets they knew they could eventually defeat - Grokster and StreamCast. They weren't even subtle. They listed copyrighted music links and offered guidance. They weren't guilty they noted because they only listed the music…sure neither was the old Napster. The problem of trying to piggyback so much on the earlier Sony ruling is that the Justices gave some strong indication that "might be" convinced to overturn the ruling or modify it…significantly. If that happens we will be so S****ed!!!

Everyone knows that if you open the door even a crack to the barbarians they will gather in mass to clean you out of house and home. Lots of lawyers (see the parallel here?) saw the similarity for a lifetime of riches in the Grokster decision. They won't care what side of the aisle they are on because the written comments from the Justices left a lot of wiggle room and gray areas that are subject to interpretation. Depending upon the chair you sit in you could interpret "…promoting its use to infringe copyright…" any way you want.

If you want to imagine what all the government intervention could do to the professional and consumer video industry look at the pharmaceutical/healthcare industry…it's your benchmark. There are more lawyers than scientists and there is an ambulance chaser behind every tree. Still their liability insurance costs are out-of-sight!

But we don't agree with a lot of the doomsayers and lawyers who see themselves being paid to sit in on product development and marketing communications meetings. Stressing that you support copyright protection is easy to do. File transfer and swapping technology that emphasizes legal content sharing can be clearly and concisely stated. Policing your p2p sites for illegal copywriten postings isn't that difficult.

A professional approach and common logic don't need a review of ethics by a lawyer.

Guns Don't Kill People

Suing every grandmother and impoverished kid in sight, MPAA and RIAA have continuously claimed that their sales and profits are off because we're all stealing from them. But they show quarter to quarter solid profits.

The two don't go hand-in-hand especially when you see DVD sales and rentals up significantly and music download purchases tripling. And we don't understand the benefits of suing your customers. Reminds us of a t-shirt we saw "The Beatings Will Continue Until Morale Improves."

On the other hand, suing technology products into submission (or oblivion) won't work either. Technology doesn't do bad things...people do bad things.

Digital content is here to stay and file-sharing is a way of life - legal or illegal. Solutions Research Group recently studied people's attitudes toward file sharing and surprise, folks were pretty evenly divided (Fig 1). Young people felt it should be allowed as did MP3 player owners.

While most had no problem with paying a reasonable fee for their downloads there is a growing concern over the security of the personal identification and payment data that is provided.

Given that it is globally impossible for the MPAA and RIAA to roll back P2P exchanges so they can return to the "good old days," We agree with a recent OECD (Organization for Economic Co-operation and Development) report. They explored the changes and outlined the social, cultural and economic potential of digital distribution. There are ways to provide sufficient rights protection and secure payments. It will take time and effort but it certainly beats suing you into submission.

Some people will always expect something for nothing. But most people have no problem with paying what is fair. And when they buy a CD or DVD they should have a right to make a backup copy, let the kids play the backup until they ruin it and keep the master on the shelf.

We know the content owners won't agree but let's say we buy the disc and make two copies - one for home and one for the cabin in the mountains. Or a good movie copy at home and one in the SUV to shut the rugrats up. Is that illegal? No, think of it as a software license where the software is on two different systems and can be used as long as both systems aren't used simultaneously.

Maybe they will have to reexamine their business models and the world we live in today.

So who's going to make the money at the end of the day? Hollywood/content owners? The creative folks? Hardware folks? Software people? Pipe owners?

As Dustin Hoffman was told in The Graduate…remember one word. Middleware!

It's not going to come fast and it isn't going to be easy. Folks across the spectrum will make money on digital content (except consumers of course). But the real heros (and folks who will have a great long-term revenue stream) in the future will be those who develop the DRM (digital rights management) and DAM (digital asset management) products that serve the needs of content owners, content delivery and content user folks!!

Faith Popcorn, noted futurist, coined the phrase cocooning several years ago of the growing desire of people to wrap themselves in their homes in the evening and be family focused. People eagerly adopted the movie purchase and rental model because it was inexpensive, convenient and fit into their cocoon lifestyle. Sitting at home in your favorite chair, socks/shoes off, eating greasy popcorn your way with a soda, beer or other drink is plain relaxing. And you get to view all of the outtakes, special segments, actor/director comments you never see at the theater. Look at the growth of home theaters. It tells you something!

Or you can get dressed and fight with the kids, drive to the theater, park and hope no one dings the car, pay $25-$50 to go in (yes all dressed), bite the bullet for your refreshments and hope some nut isn't there also bent on making a political statement. Oh yeah you still have to drive home with kids screaming in the back and fight with them to go to bed at a decent time.

There will be two delivery mechanisms for this entertainment - disc playback (more on this later) and streaming. While folks on both coasts of the U.S. and in a few countries around the globe enjoy the benefits of broadband, it isn't ubiquitous!

According to a new Pew Internet Project report 49% of folks in the U.S. still have dial-up at home and 40% don't have broadband at work or home. The numbers are almost as dismal in other industrial countries and the ROW? Don't even ask!

Strategic Analytics projects it will be at least 2010 before we have "reasonably" widespread high-speed connectivity in the U.S. The good news is that the competition will be fierce as cable/satellite, phone, powerline and "new" approaches work to become your content delivery mechanism.

What we need is a home content management server (HD-based like ADS Tech's new server drive kit), a write-once/rewritable disc-based library or combination of the two to watch, view, listen to what we want…when we want.

Much as video folks worry about "protecting" their assets, it is audio that will probably set the stage for tomorrow. Sure folks still buy CDs but if music downloads have shown us anything it has shown that even this model is broken. You buy a disc but you really only "want" 2-4 of the songs. The rest are a waste of space, plastic and money.

P2P has become so popular (legal and illegal) because people want their choice. Most of the illegal "free" sites make you work at finding the song you want to download and enjoy (hey…they don't make money so how do they invest?). But the micro-payment sites are a snap. Sign up, drop in your payment scheme, do a global search, pay for the song - a reasonable fee -- and download your music. BAM!!! You are entertaining yourself.

Like the song we're playing? Want us to "give" you a copy? Get serious!

Not every movie will be a download financial success. Not every song will go platinum. But the vast majority of people will pay - a reasonable fee -- for their entertainment if the "industry" quits trying to beat their customers into submission. But they need to be continually reminded that digital content has value…it's called education not legislation!

Blue Decision Makers

You have got to love the marketing creativity of both sides of the blue laser "discussion."

BDA (Blue-Ray Disc Association) just announced the results of an independent study among consumers that clearly showed consumers prefer the Blue-Ray Disc for their content in the future! Even though they can't program their VCR and don't know the difference between DVD+/-R/RW an "overwhelming" 58% loved BD and only 15% liked HD DVD!

While the PC and CE folks jockey to advance their respective "best for you" solution; the Gen X, Y, P boys and girls play their games.

Have you looked - really looked - at the PlayStation, Xbox and Nintendo systems?

They have powerful processors, lots of connection possibilities and the easy ability for you to add "other" options like PVR, storage, wire/wireless connectivity and…the disc recording/playback solution of choice!

Consumers won't replace their current DVD drives/recorders and players any time soon (IDC still says today's technology will be the leader in 2010 and Jupiter Research reports people aren't interested in adopting a new disc format).

In fact, Jupiter's research showed that only 21% of the people who bought their first DVD player did it for video quality reasons. Sure there is "interest" (54% of respondents) in the next blue laser technology…IF it is backward compatible with present DVD players!

Ok so that won't happen!

But the game consoles are moving into the family/living room because 1) kids are buying them

 and 2) people of all ages are spending more time playing games

They are simply better than lots of the entertainment alternatives being offered. Add some music/audio capture/download capabilities and send it around the house…cool. Like the box and want to use it to capture some HighDef show or watch a new movie release? What the heck we'll add the component that makes it possible (after all really good entertainment centers aren't all-in-one solutions). After all, it's only an incremental cost.

Without even realizing it, the PCs and CE devices could very quickly become the accessories to the game console in our wired or wireless home network. Boy, won't that be humiliating?

No wonder Microsoft is hinting that they may license Xbox software. Come on people, Gates didn't get rich by being stupid!!!

The HD and BD PC/CE camps may be spending too much time buying drinks and dinners in Hollywood and on Broadway. Perhaps they should be focusing on trips to Tokyo and Redmond? Granted spending time with the folks at EA, BV, Epic, Lyon, Midway, Pandemic and Xtreme may not be worth talking about as your time with Tom, Steven, Julie and other stars at your next cocktail party. But we are talking about the future of the next generation technology!

Tomorrow's fortunes aren't made by walking down the old, well-worn paths.

DVD Insider #40 - Optical Storage Update - Who Cares Which Blue? Will Compromise Occur? What Is Unsaid? What Do You Do?

Who Cares?

Sometimes we are so dense!

We have actually been keeping score on which Hollywood studio and which content owner "signed up" for the HD- (HD-DVD) and Blu-ray Disc (BD) camps. We actually wondered which wanted to limit their creativity with 15GB (HD) or expand their horizons with 25GB (single layer) and 50GB (double layer) capacity for their fantastic next generation video content and extras.

We thought about all the TV folks planning fantastic entertainment what they can beam to our digital TV sets with thrilling effects we can time-shift, copy and enjoy anywhere in the house or on the road.

We studied the HD and BD format approaches and tried to see how Hollywood and the TV folks could force the two parties to the table and hammer out a compromise.

As we slowly stepped back from our hours of research and stared at the papers strewn across the floor we had an epiphany!!!!

Those folks not only don't care which blue write-once and rewritable technology the industry delivers…they don't want either one!

All they want is a high definition ROM. A disc you can buy, rent or borrow that allows you to view their movie, their TV series, their music audio and not copy.

Does the consumer care? Sure…eventually. But at the present time a next generation storage device/medium is low on his and her priority list because they need/want to buy new DTV sets, new camphones, new game systems, new PCs. Then they need to struggle to interconnect them to share devices/content…even if it is the use of the printer.

While consumers want all this content movement without wires, the reality is that today and for the near future the easiest way to accomplish this is with wire - over coax or through your powerline.

Now that the FCC has mandated that consumers will have DTV sets by 2008 the CE industry is rushing to meet the demand. Why the rush? Well digital signals require less bandwidth than analog signals so this means the government can take back all of that wasted and unused bandwidth and sell it to someone us the way the U.S. is amassing its debt they can use all the money they can get!

As a result, the penetration curve for DTV will almost be as steep as DVD, which was the most rapidly accepted technologies in our history.

How fast we "accept" the new enhanced TV is up for debate. According to In-Stat's recent report more than 15.5 million HDTV sets will be sold this year worldwide and by 2009 that number will increase to 52 million. On the other hand, Informa Media Group indicates that there were about 144.1 million Digital TV households worldwide and that by 2010 there will be roughly 369.8 million.

That's enough to make the accountants at Sony, Panasonic, Hitachi, Mitsubishi and the rest of the plasma, LCD and projection TV suppliers hearts beat a lot faster. Of course that 2010 number is only roughly equal to the population of the U.S. so there will still be a lot of people left behind.

What do people really want? According to a recent CEA survey (Fig 5) and folks want to play DVDs, play video games and record TV programs (among other things). And they are spending serious dollars to do it! In the U.S. alone consumers spent more than $330 billion for (in order of priorities) digital CE, content, wireless, PAY-TV service and similar entertainment.

Behind the scene Hollywood, broadcasters and other content developers are working deviously to ensure they maintain control of every bit of "their" content. They have devised a series of "solution" to deliver, manage and control their content.


Ok now that we have taken the content developer/owner and consumer out of the blue-ray equation, who really cares about a single format? Patent holders!

Do we need a blue-ray disc? No, Yes, Probably…

Blue-ray technology represents the next performance bump for optical storage which despite all of the pro/con discussions delivers the best, most economic and most versatile archive storage technology we have.

Single-layer CDs, which cost almost nothing, store 700MB of data or about 4,000 photos, 20 minutes of video and filing cabinets of digital data. Because the technology has been with us more than 20 years you can record and play the disc almost anywhere on the globe…that's universal!

DVD media is now readily available in dual/double layer formats with 8.5GB of capacity, which is equivalent to more than 48.5 million photos, two hours of MPEG-2 video and tons of data. Even the best single-layer media is extremely economic today and the 8.5GB media prices are coming down as production yields and volumes increase.

To achieve 50-100 year data life on a disc the industry has to move to some flavor of blue-ray technology and in an ideal world the two factions would put individual interests aside and work for a common solution for the consumer. As you sift through your spam, phishing messages and viruses you can see this isn't a perfect world.

A single specification won't appear! A compromise specification is virtually impossible because of the read/write approaches of HD and BD. There are significant differences as to the placement of the write/read layer of the disc and this affects every aspect of the separate technologies.

Sony and Panasonic have been shipping BD recorders in Japan for more than a year. Panasonic has promised a BD drive in early 2006 and since they have been so successful in the past that announcement sent shockwaves thru the NEC and Toshiba organizations.

Not to be outdone, Toshiba and NEC announced they would begin shipping HD DVD recorders and drives the first of the year.

While the HD-DVD crowd's main claim to fame was that media could be produced on today's DVD production lines (which Verbatim/MKM and Maxell have proven) thus alluding to the fact that the media would cost the consumer less. The BD team pointed to higher capacity single and double layer R and RW media and recently announced that through the efforts of Pioneer and MKM the firms had developed special dyes and production techniques that would significantly slash the cost of the media.

That kind of news from both sides is great! But…

None of the firms have mentioned the vulgar word - consumer price. If you use the prices in Japan as a rough guideline the disc costs are $25 - $40. Reports are that burners will be "under $1,000." That is a long way from consumer pricing!

Pricing like that, even at OEM levels, kept burners out of PCs and notebooks for more than three years. It is only now that DVD-anything, disposably-priced burner is a standard component in almost every medium-high performance PC and notebook.

It also doesn't address the issues of the replacement cost of DVD players, set-top recorders, cameras/camcorders and software.

The Sleeper Options

While the blue ray factions in Japan work to one-up each other there are also some less visible options that could surprise us all. Taiwan and Mainland China have already perfected EVD and FVD technologies using red lasers. These may gain sales in the two countries but there is little incentive for the technology and content owners to adopt them.

Holographic technology which shows promise of 100GB, 300GB, 1TB and eventually 3.9TB disc storage appears to be very promising for the business/professional arenas. Optoware seems to be slightly ahead of InPhase in these developments (six months) and by 2010 holographic could be the big bit bucket that we'll be using for niche applications - you know financial, legal, government, healthcare!

What is Unsaid?

While Hollywood, broadcasters and content developers aren't concerned about which blue technology is implemented, they are deadly serious about not revisiting the mistakes of today's CD and DVD technology.

It is true they want to deliver content to you in every way, shape and form (Fig 10) at home, in the office, on the road, to your portable device…you name it they want to be there for you.

The hardware and media manufacturers will continue to play the game of words and ramp up their respective production operations. In stealth fashion, the content owners are making very certain that when you finally buy their ROM-based videos or receive their content through the pipe of your choice, you will either not be able to make a copy or the number of copies will be extremely limited…1, 2, 3?

High Definition content has provided content owners the opportunity to start with a fresh slate and get it right this time. They aren't going to miss the chance to put the horse back in the barn. Next generation content protection for video and audio content is extremely robust. Digital rights management for over-the-air signals has the Broadcast Flag embedded that will dramatically impede recording the High Def and digital TV signals.

The content owners have become excellent quick studies of digital technologies over the past five years as they've watched DVD and on-line services get stronger, better, bigger, faster and more ubiquitous. This time around they are going to make certain they don't leave any money on the table this time

What Do You Do?

Will one of the HD leaders blink and move to a compromise? Will a BD player extend the branch of friendship? Doubtful on both counts because both sides will have to give up too much in the compromise. Sony has committed to BD for the PS3. Panasonic has missed so many technology opportunities they look like a perpetual bride's maid. Pioneer has strengthened its technology position. Toshiba amassed a broad base of allies before coming out of the closet. NEC knows read/write mechanisms perhaps better than anyone today.

The best scenario will come from one of the volume producers - LG, BenQ, LiteOn - that will follow Sony's playbook from the last DVD game. One will introduce a HighDef-everything writer that supports both HD and BD as well as leverages today's multi-DVDs and yesterday's CD. Then they will have to focus on driving costs out of the hardware which will require at least two - three years.

In the meantime, super-multi DVD burners and recorders are becoming commodity priced -- $40 and $100 - and give content developers and users the choice of 700MB, 4.7GB or 8.5GB storage. Those discs can be played virtually anywhere. Homes on a global scale increasingly have at least one DVD player.

At the OEM level even High Def proponents like Dell and HP will be hard pressed to put expensive blue technology burners in anything but their most expensive systems. Perhaps this is why industry analysts like IDC estimate that even by 2010 blue laser drives will only account for two percent of the units sold. If history and human nature are any indictors, very few of the red laser burners will find their way into home DVD recorders or camcorders. As we move to produce and deliver our second billion notebook and desktop systems the majority will include disposably priced DVD burners.

Content developers will end up with an even broader array of software tools - today's multi-purpose DVD, HighDef on DVD, HD-DVD and BD products.

The software folks will certainly write their support for blue…just in case.

But increasingly they are working on new video compression algorithms that allow people to store more data and content on today's discs. DivX 6, H. 264, MPEG-4 AVC and WMV9/VC1 enhance the capacity of today's 4.7GB and 8.5GB discs without increasing costs or asking people to replace today's barely used hardware.

Faced with having to make a decision between expensive option A or expensive option B or cheap status quo, consumers will most likely take the time to learn how to do more with the technology they own. And because today's burners, recorders and media are so inexpensive retailers will start featuring them on their endcaps and relegate the Blue technologies to the geek and adventurer shelves.

Suddenly they will discover a standard writable (or rewritable) 4.7GB DVD will hold one hour of HighDef material. In addition, an 8.5GB DL disc will hold three hours of content. That's a lot of low-cost storage that hasn't been fully exploited; even though "everyone" is taking pictures with their camphone, capturing hours of memories with their camcorders and time-shifting the best broadcasters have to offer.

People who wring their hands and claim that the lack of a compromise will confuse the consumer and slow adoption are right but only partially right. It has taken nearly five years for today's DVD technology to become close to mainstream. Blue-ray technologies - regardless of what the sides say - will require new production processes that will encounter low production yields. The need for initial profits plus the universe of patent royalties and limited competition will also keep devices and media expensive and scarce for several years.

While technologies like DivX, WMV and QuickTime don't have universal acceptance; it is a lot easier - and less expensive -- for manufacturers to offer these HighDef storage solutions to their hardware to sell stuff now rather than wait for the BD and HD camps to resolve their issues.

Only a few benefit from the royalties involved. The rest of the industry benefits from sales!

DVD Insider # 39 - Computex, Apple Shift, InfoComm

At trade shows you quickly realize that there is a lot of truth to John Guare's play and the movie adaptation - Six Degrees of Separation. There may well be billions of people on this planet but manufacturers and show visitors run in the same circle.


This year that circle - which grew to about 130,000 people - there weren't any breakthroughs, just a lot of refinements of the concepts that had been shown at CES and CeBit early this year. By the time the holidays roll around the friends and friends of friends will have wrung most of the costs out of the products so we will have something we can affordably buy.

Once you sifted through the noise there weren't any killer applications or product breakthroughs you come to expect with major shows. Many attributed this void to the shortened product lifecyles and the need to squeeze pennies out of the products as prices and margins continue to drop. When you are at the product development table most managers will make safe incremental bets and enhance current products rather than rolling the dice on high-risk products.

Dual-core processors from Intel and AMD created a lot of interest at the show, as did the refinements of liquid cooled processing. Then too there was the integration of more and more technology on the same old products to make them "new and exciting."

PCs - desktop and notebook - had cleaner, crisper screens, wireless enhancements, slightly improved batteries, incrementally faster graphic chips, better audio and bigger hard drives. Portable devices - they can hardly be called phones anymore - had better screens, audio/video download capabilities and yes more storage capabilities/options.

Of course the two product categories are important to the industry's health. IDC recently announced that we have begun shipping our second billion PCs and that the growth potential remains strong. That and Microsoft's announcement that they will ship at least some flavor of Longhorn this next year which will mean new versions of the application software will be required by users put the sparkle in a lot of people's eyes.

While Intel and AMD set the ground rules for the dual-core processor discussions, the companies that could benefit most from the products will probably be Taiwan's Via, Taiwan Semiconductor Manufacturing Co (TSMC) and United Microelectronics Corp (UMC) in the audio and video content products. Both are getting a lot of interest in their video, audio and peripheral chips. Microsoft's announcement that they will ship at least some flavor of Longhorn this next year which will mean new versions of the application software will be required by users put the sparkle in a lot of people's eyes.

To build excitement around the system potential of the new chips and product advances, firms showed a variety of cube and notebook home entertainment systems (see sampling of product photos) like Intel's own PC prototype and Asus' new MC cube. Some of the systems delivered the same feel as CE products by incorporating InstantON. On in a flash they opened the world of home entertainment with audio, photo, video and TV content.

As you might expect with some of the firms' ability to mirror ideas (much nicer way to say copy) was the beginning of microminiature PCs. AOpen was one of the first out of the gate with an economic PC Mini. By the time the holidays and CES roll around expect to see a wide array of versions. We can also expect whole families of complimentary storage - like ADS Tech's Mini drive kit -- and digital media players.

Wireless was everywhere at Computex and everything was wireless. Not just mobile solutions (which were huge) but there was a lot of WiFi and home networking solutions around. Depending upon the booth and the company focus people were "explaining" how MC PCs, MC CE, Smart TV or Service Provider CE solutions were going to be huge in 2006. They were all partially right because people will probably buy multiple home entertainment solutions.

But we have a long way to go. According to a report by the Diffusion Group in May of this year the average number of networked devices worldwide last year were three and that even by 2010 the number would only increase to four. Our bet is few of those are entertainment devices at the present time.

The big challenge will be developing a "must have" demand at the consumer level for networked systems and entertainment. That education has a long way to go. According to a January Harris Interactive survey 95 percent of the people who were asked why they didn't have a home network responded simply that they had no need. Other reasons given included HW/SF price, don't know what to purchase, ease of set-up, compatibility issues and in adequate after-sale support.

The phone manufacturers - who are everywhere in Taiwan - understand that folks now want more than a simple cellphone…ok not you or us but someone does! Units were on display in every shape, color and form. They offered all of the multimedia capabilities people believe they want or at least those that service providers want to sell. The new units are positioned become MP3 replacements, personal/portable TV sets, email/IM delivery units and oh yes by the way, telephones.

Actually bigger, better screens were everywhere along with the growing promise of wireless entertainment and communications everywhere.

Apple Does Intel

We aren't about to add to the noise level Jobs received when he announced he was shifting to the Intel platform. The press reacted as though Otellini (hint that's Intel's boss) had won the equivalent of the Nobel Peace Prize or the combined worth of HP, Dell and Lenovo.

We know people will fall on the sword for Steve but for gawd sake Apple has less than two percent of the total PC market! People refer to Apple as the only Intel hold out while Waite's Gateway has a greater marketshare and people simply go hohum regarding the firm's success.

Will people really know there's eventually going to be an Intel chip lurking inside the Mac? Probably not. Only the editors/reporters/reviewers who are in lust with the platform know what is really inside.

Apple will probably pass up the Intel marketing money and not put one of those fantastic "Intel Inside" labels on the system and you can be certain that even though he shares the HW platform he won't invite Gates to put Windows on HIS systems!

The key to Apple's limited and mystical success has nothing to do with the processor but the OS and applications. Everything else is sex and sizzle.

To paraphrase Spielberg when he heard people had been standing in line for a week for the latest Star Wars opening…"get a life folks…it's only a computer!"

The biggest surprise to us was the fact that he announced the switch wouldn't really take place until late next year which really gives us to purchase a new G5 right away while they are still available.

Only Steve would have the cajones to fly in the face of business logic and announce a major platform switch so far in advance. We know he knew Adam Osborne and the facts behind the demise of Osborne Computer and the initial purveyor of the "portable" computer (roughly the size and weight of a portable sewing machine). Adam announced the Osborne 2 months before the rollout, production problems stalled shipments and the company went from 100 to ZERO in 2.4 sec. It was so fast and so bad the company is now an MBA case study in many colleges.

Question is, how long will folks stand in line waiting for the next generation Intel-powered Mac? This will be the art of spin at its best. Could be worth another MBA case study???

Seeing at InfoComm

Remember that 6 Degrees?

CES used to be consumer toys. NAB used to be broadcaster toys. InfoComm used to be AV folks toys. They are now in each other's toy box.

InfoComm is still about projection systems and viewing solutions. But increasingly the best home theaters are projector-based, not big black box sets.

Most of the products displayed at InfoComm are targeted for business, education, government and religious institution applications. Most are still sold through professional AV dealers and AV specialists but the market potential hasn't gone unnoticed by CE resellers.

With home solutions now available starting below $1,000 the CEDIA dealers/installers will get increasing pressure from the Best Buys, Comp USAs, Fryes and J&Rs of the world. The professional side still represents the greatest profit for the individual participants but with the lower priced products available even the pros will look long and hard at the "home" products for the office. On the other hand, the consumer segment represents both volume and brand recognition for the manufacturers…that's important to all of us today.

The big players in this area are the same firms that are producing the plasma and LCD sets - Mitsubishi, Panasonic, Sony, Toshiba, Hitachi and Sanyo. Of course they are getting competitive pressure from Dell, HP, BenQ, NEC and Epson who see a whole new world of sales potential. They ranged from Hitachi's high Lumen projector to Dell's pocket-sized projector (see photos).

There were some breathtaking LCD and Plasma screens shown (see photos) but we some really exciting DLP projectors. They sorely tempted us to find someone who wanted a really good "big black box" so we could have an automated screen and one of the new DLP projectors. The idea of being able to tuck away your TV viewing when not in use is going to be appealing to lots of people in the years to come!

With the increasing pressure around the globe for TV signals to be sent digitally so HighDef can be everywhere will rejuvenate sales across the entertainment spectrum. According to In-Stat there will be about 15.5 million sets installed this year and that by 2009 the number will increase to a very respectable 52 million. These numbers sound credible when you see the STB and DTV semiconductor projections.

The only thing that can slow this growth down will be price.

While both the HD and BD blue laser teams were at the show promoting their solutions as the way ahead leaders in HighDef content, no one said a word about what agreement had been reached with Hollywood and broadcasters about the broadcast flag issue. If you are unable to time shift your shows, will DVD recorders or set-top boxes make a lot of sense to the consumer?

JVC created a lot of stir with their announcement of a 3/1 video recorder/player and HighDef player. Both used today's red laser technology. Their spokesperson said the player would support IP network streams, HDV's MPEG-2, Windows' Media Video (WMV9) and content from today's HD video camcorders. Both solutions are a little expensive initially but if some of the Taiwan burner, recorder and player manufacturers take notice and JVC ramps production those prices could come down very rapidly.

We agree that there are several HighDef MPEG-2 and MPEG-4 codec standards being talked about right now. But the cost to an OEM of adding 2-3 of them to their units will be significantly less than paying the royalties for either HD or BD (or both) plus the cost of the blue laser read/write mechanisms. Especially if they can store that content on today's low-cost single and double layer DVDs.

Maybe there's a viable solution to the blue laser discussions after all…Column C!!!!

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