Labels Extend Their Own Digital Subscription Service

From The Online Reporter   

- Europe Now, US Soon

 - Potentially Most Powerful iTunes Rival

 - Rolling Out to Smartphones, Smart TVs, Game Consoles, STBs and Blu-ray Players

Get the adrenaline and smelling salts ready for this one: the record labels have successfully launched their own streaming music subscription service, and they’re soon extending to battle in one of the toughest markets around — the US.

And the kicker is that it looks good.

Along with most of the world’s major record labels, Sony started its own music streaming service, “Music Unlimited powered by Qriocity,” which launched in the UK and Ireland in December and in France, Germany, Italy and Spain over the weekend. It is currently available on Sony’s PlayStation 3 game console, Blu-ray players, Bravia TVs, PCs and soon smartphones running Google’s Android.

Qriocity is Sony’s existing platform for video distribution to its devices, and at CES the company said that Qriocity would extend its reach to most older Bravia TVs and the entire installed base of PlayStation 3s, but support on Blu-ray players will vary because of the hardware requirements involved. 

Sony and the other labels have largely relied on start-ups and third-parties to license their content and distribute it to users in a way users found engaging, a model we never quite understood here at The Online and Internet TV Reporter.

It’s about time the labels leverage their own content with their own offering.

At least partially acknowledging this time delay, Tim Schaaff — the chief executive officer of Sony Network Entertainment, the division of Sony overseeing Music Unlimited — said “We took a long time looking at music before jumping in,” at MIDEM over the weekend.

Music Unlimited currently counts more than six million songs from Sony Music, Universal Music, EMI and Warner Music and others, giving these labels the ability to offer their own content in their own fashion, no middlemen involved. It’s a model that’s desperately needed as CD and other physical revenue continue to drop.

 

The service also helps the labels take control back from other digital music stores, namely Apple’s iTunes. Apple, according to the labels, has too much control over the market. In September, Apple said it had delivered 11.7 billion song downloads, and over the weekend it delivered its 10 billionth app download.

The Quick and Dirty

Music Unlimited costs €9.99 ($13.67) per month for a premium service and €3.99 ($5.46) for a basic plan.

It won’t be going the free ad-supported route because “free doesn’t make any money.”

The basic plan will give users the ability to skip an unlimited number of songs so they can discover and listen to the music they want to hear. The basic plan serves mainly as an “infinite ad-free radio station” where users can listen to “dozens of personalized channels” categorized by things like genre, era, user mood and tastes.

The premium subscription plan — the service offers a one-time, 30-day free premium trial — lets users listen to every song in the catalog on demand, create personalized playlists and access the continually updated Top 100 channels that also serve similar to music charts.

The service has its own recommendation engine and tailoring options, allowing more personalization as users listen longer. 

Playlists, preferences, radio stations and other information can be synched across any device supporting the service. Users can also synch playlists and media from other services, such as iTunes, giving them access to their existing music collection across any compatible device.

A Bloody Legacy

Music Unlimited will require users to pay to access songs and add them to personal libraries, restricting access to devices connected to the Net.

Unlike its big competition in the space, Music Unlimited will not feature two very popular features: a free version or song downloads.

Taking this road means walking down a bloody path, strewn with the bodies of streaming services like BSkyB’s Sky Songs, Lala, Spiralfrog and many others. “There have been a lot of dead bodies along the way,” Schaaff said.

Looking at that legacy and the existing competition — from iTunes and Amazon MP3 to Spotify and Pandora — Sony says it has one key leg up in the situation: an estimated 350 million connected Sony devices in the marketplace by the next two years.

The other trick up its sleeve is the Sony unit Gracenote, which has an extensive and powerful database for recognizing and recommended music based on a user’s tastes and listening habits. At CES, Gracenote also demonstrated a feature that could tailor music within a user-specified genre to their mood and it is being incorporated into the offering under the SensMe brand.

Gracenote had one of the best booths and presentations we saw at CES, and if Sony fully leverages what exists there, Qriocity and Music Unlimited could be destined for great things.

Benefits of Being a Brand

While users may not always be able to name their favorite Sony or Universal artist, they recognize what it means when a venture is backed by, or comes from, all of the major music labels.

Just look at the 2009 effort for online music videos, Vevo. The Vevo site was a reaction to two major trends: 1) music videos were popping up online and gathering massive views on YouTube, a partner on Vevo; and 2) TV channels like VH1 and MTV laid most of the groundwork in making music videos a cultural phenomenon but had failed to successfully transition their younger users to these models or keep up with them on the Web.

Vevo reached 50.6 million viewers in December according to comScore. Jean-Bernard Levy, the CEO at Vivendi SA, which owns Universal Music, said that its total number of unique users is closer to 60 million and that Vevo has secured premium advertising for the majority of its slots.

Sony’s clout also helps because of its knowledge of the cloud. Sony has successfully delivered Web-based content to a wide variety of its devices, from Blu-ray players and TVs to smartphones and game consoles, so the service won’t have many of the start-up jitters.

Money Matters

According to the IFPI’s latest annual report, piracy is rising, as are Web sites and forums that link to content accessible by pirating technology. The report also said that the hundreds of digital music services licensing content from the major labels have done little to stem piracy.

That being said, global sales of music via the Web and mobile phones grew 6% in 2010 to $4.6 billion. It is unclear if this slowing growth — when compared to 2009’s 12% growth and years before — is due to an increase in piracy or if the market is simply maturing.

Taking both views into consideration, the labels have said that Music Unlimited is targeting the 85% to 90% of consumers who have not yet participated in digital music services. Western Europe seemed to be one of the easier markets to gain a foothold in, and Omnifone, which powers the service’s technology, is based in the UK, making the initial launch market an easy pick.

Sony said that it wanted a broad test market where its brands were well known enough that it had a chance to make sure the service was feasible and potentially successful before it begins a multi-million dollar marketing effort.

It appears that Sony was pleased with its first markets and feels like the service has what it takes to compete in some of the toughest and most crowded markets around.

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New Report on Chrome OS New Report on Chrome OS Few people took Google’s Android seriously when it first appeared, but it has become a dominant operating system for touchscreen products like smartphones and tablets. It threatens to replace Apple as the bestseller in smartphones. The same could happen to Chrome, which Google has positioned as THE operating system for a coming avalanche of cloudbooks and other devices that could substantially cut into the market for portable PCs and tablets. It is aimed at both the consumer and business market.  Intel was showing two low-power PC portables with Chrome OS in its booth at CES. They were fast — fast to load and only a few seconds to get on the Web and begin running applications.  Chrome devices will have a full keyboard, unlike tablets, and be used only for cloud-based computing and storage. Rider Research has prepared an executive briefing paper on Chrome — what it is and its likely impact. To get a free extract, please e-mail paperboy@riderresearch.com or call 225-769-7130 or +44 (0)1280 820560

Intel & Smart TVs. Part II

From The Online Reporter   

 

 - Intuitive, Limitless, Extensible

Intel unveiled eight smart TVs that have its processors at CES, as we reported last week.

Intel defines smart TVs as having more than just a few widgets. Every Blu-ray player must have an Internet connection, but that doesn’t qualify them as smart TV-capable, although even the most basic model has over one million lines of software code. Intel says that devices without a full-blown operating system (OS) and, hopefully, its processers are not smart TVs. Intel has earned its smart TV credentials. In addition to coining the term “smart TV,” it worked with and provided technology to Yahoo and Google for their smart TV platforms.

It likens smart TVs to the evolution of cell phones and says the same evolution will happen to TVs:

	Cell phones	TVs
Stage 1	Feature phones that make phone calls	Feature TV for watching
Stage 2	a few apps like music, perhaps camera	Internet connection, perhaps a few apps
Stage 3	smart phones	smart TVs

An OS and a powerful processor like Intel’s are needed, it said, for a quality user interface with lots of functions. 

Smart TVs must be as intuitive as Apple TV is, extensible so the user can add apps, and limitless in its ability to search and play content from three sources: broadcast, online video services and the user’s personal content that’s stored on local network.

Intel does not require smart TVs that use its processors to have a full-blown browser, as we previously reported.

It currently recognizes four OSs as suitable for smart TVs: Google’s Android, the MeeGo OS that Intel developed with Nokia, Microsoft’s Media Center without the PC-centric features and, of course Apple’s iOS, which does not use Intel chips. TV set makers could also cobble together their own version of Linux, but that would seem to have a limited life expectancy. Intel thinks that manufacturers will need to build in smart TV technology to run the software and online services they’ll need to compete.

After Yahoo launched Yahoo Connected TV two years ago, it was slow to push the technology to set makers and get more content sources and apps. We kept asking why there wasn’t a Yahoo TV to compete with Apple and more marketing for the platform. Perhaps Yahoo became distracted by external factors, such as Microsoft’s attempt to buy Yahoo and the change of CEOs. Both caused extensive reorganization at Yahoo. The meetings we had with Yahoo Connected TV people indicates that the company has its act together and is moving forward rapidly, as we reported two weeks ago.

Intel says the content owners’ blockade keeping Google TV from playing their Web videos is a matter of reconciling business models. The owners have existing and very profitable deals with the pay-TV services that they do not want to endanger. If the owners give their content away on the Net, it said, why should pay-TV companies pay them for it?

An Intel spokesman confirmed our prior report that the content owners detect the special version of the Chrome browser on Google TV to block access to their sites. Google could work around the blockade by changing the browser but doesn’t. That, he said, shows Google is not trying to avoid the restrictions and shows it is not antagonistic towards the owners. Of course, Google has a bad track record with the owners, and its YouTube operation is being sued by Viacom for copyright violations.

From that standpoint, Microsoft, which is easing its way into the smart TV market, may get prime-time content before Google. Its history is one of protecting copyrighted material, and it has existing contracts with the owners, such as those it has with its Xbox Live service and its video games.

Intel believes the Google TV flap will be resolved and content owners will be properly compensated. Google is an advertising platform first and foremost. Google TV’s concept is based on its ability to search all three of its users’ content sources: the Internet, their pay-TV service’s electronic program guide and their locally stored content on a DVR or PC. Without access to the owners’ online content, a major part of the concept fails.

Intel sells three processors that are used in smart TVs and smart TV adapters: CE3100 (Kenmore), CE4100 (Sodaville) and the Atom-based CE4200 (Groveland).

Currently, any of the three Intel processors are the only “recommended” processor for Google TV, meaning that consumer electronics must buy Intel chips if they want to produce Google TV products. That’s how the deal works.

Intel expects some TV set makers to offer different platforms to see how each performs in the market place. Vizio, for example, plans to offer both Yahoo- and Google-based TV sets just as cellular carriers and manufacturers offer smartphones based on different OSs.

Intel’s completion in smart TVs chips is ARM (like the one in Apple TV) and AMD, which has launched new chips. As it showed at CES, Intel is off to a great start.

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Apple COO: Android Honeycomb Is Vapor Ware

It ain’t bragging if it’s true, is it? Apple COO Tim Cook on the forthcoming Android Honeycomb devices: “There’s nothing shipping yet, so I don’t know. Generally they lack performance specs, price and timing. Today, they’re vapor. We have a huge first mover advantage. We have an incredible user experience from iTunes to the App Store and enormous number of apps and a huge ecosystem, so we’re very, very confident in entering in a fight with anyone. If the iPad or tablets do cannibalize the PC market, keep in mind we have low share in the PC market and the other guys will lose a lot more.” He said the iPad may cannibalize sales of the Macbook Air but also expects the iPad to have a halo effect of attracting new users to the Apple brand, including the Mac.

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BT Offers Hotspot App to Its iPad Customers

BT Home Broadband customers that own an iPad can get an app that automatically logs them on to BT’s 2-million or so Openzone and Fon Wi-Fi hotspots, the company said. It’s free.

'Your Television's Going to Get Connected'

From The Online Reporter   

 

“The future of the TV is online, and your television’s going to get connected,” says the Daily Telegraph’s consumer technology editor Matt Warman. Main Street press like the Telegraph and The New York Times have been reporting on smart TVs and the move by the TV networks to get on the Net. It’s a sure sign the concept has moved from someone’s crazy notion to an event that’s happening in millions of homes and all the TV networks.

Warman reported that for broadcast TV luminaries at the Media Convention in Oxford, the talk was about “the importance of the Web in the UK’s creative industries, and how content, watched in new and traditional ways, will continue to be king.”

A visit to any consumer retailer will show that virtually every TV set is a smart TV, with an Internet connection and lots of widgets to access online sites for content and services. The license to make Blu-ray players requires that every unit have an Internet connection. (It’s ironic that Internet connection may ultimately lead to a decline in sales of Blu-ray movies and TV shows, isn’t it?)

Samsung UK recently said that owners of its newer televisions have downloaded more than two million TV applications that give access via the Net to such services as GoogleBBC iPlayer, Twitter and movie rental service LoveFilm, according to Warman. Maps, the

He points out that it’s a sign of the times that a major media executive, the BBC’s head of future media, Erik Huggers, is leaving the BBC to run Intel’s digital home division. Intel showed a lot of oomph in connected-TV technology at CES with a booth near the front entrance of the main hall and a smattering in its booth of devices from several hardware makers for connecting TVs to online content and video services plus in some cases to pay-TV channels and over-the-air broadcasts.

From their very beginning, Intel has been involved in the two most ambitious connected TV efforts, Google TV and Yahoo Connected TV.

But, Are the Home’s Network & Broadband Ready

The seemingly sudden move to dominance by smart TVs and Internet-connected Blu-ray players raises two points:

 1. The current state of Wi-Fi technology means that most purchasers will get home and find they need a wireline connection to the Net to obtain the best streaming performance. Will they run an Ethernet cable, or will they buy HomePlug or MoCA network adapters? HomePlug has the lead in the retail stores now but the MoCA crowd introduced some snazzy retail products such as adapters for Ethernet to/from coax at CES.

 2. Is the wireline broadband infrastructure ready for the smart TV era? It’s said that Netflix, which is on every smart TV and Blu-ray player and will soon have its own red one-click button on remotes, already accounts for half or more of all traffic on the Net. TV sets with Netflix’ streaming service only started selling in volume about a year ago. We saw what the Apple iPhone did to an un-prepared AT&T wireless network. The cablecos and telcos are working to increase the speeds over their network to handle even the very-demanding 3D video but will they have the bandwidth for the volume soon enough?

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Samsung Secures 2m App Downloads

Samsung is seeing some strong growth in its smart TVs, announcing that two million apps have been downloaded across its installed base.

Samsung’s TV app marketplace launched last year and this milestone comes just two months after Samsung announced that one million apps had been downloaded from its service — must’ve been a heck of a holiday season for them.

The benchmark looks even more impressive when considering that it took 268 days for the one-million download mark to be reached.

According to Samsung, YouTube and Hulu Plus are among the most commonly-downloaded apps. Other big apps include AccuWeather, Blockbuster’s on demand service, ESPN’s apps, Google Maps, Pandora and Twitter.

Samsung previously said it believes that 6.5 million of its smart TVs were sold in 2010 and that the majority of its new TV sets will include its apps platform. Samsung expects to sell 20 million TV sets by the end of this year.

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Netflix Furthers its Physical Phase-Out

From The Online Reporter   

 

There’s no question that Netflix wants its physical distribution business to go by the wayside, and for further proof look to its latest update: the removal of the “add to DVD queue” option from streaming devices.

This offering allowed users to add titles to their DVD queue when searching through devices like smart TVs, Blu-ray players, STBs and game consoles. 

Jamie Odell, director of product management at Netflix said the company is “doing this so we can concentrate on offering you the titles that are available to watch instantly. Further, providing the option to add a DVD to your queue from a streaming device complicates the instant watching experience and ties up resources that are better used to improve the overall streaming functionality. This change does not impact the Netflix Web site, where most members manage their DVD Queues.”

While the ‘ties up resources’ line feels a bit trite and has produced a lot of consumer ire on Netflix’ blog, Odell does make a valid point that many consumers and commentators have overlooked. Removing the option to add DVD-only from streaming devices means that these titles won’t appear on searches made directly on streaming devices, so the only content the user will see on his Netflix TV app is content that can be played directly and instantly on the TV through the app.

Couple this with the new Netflix button shipping on remotes later this year, Netflix looks poised to leave its physical business in the dust.

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For Spotify It’s 1 US Label Down, More to Go

Spotify has successfully licensed content from Sony Music in the US, according to the Wall Street Journal. As the rumor pans out to be true, it appears that Americans are one step closer to seeing Europe’s streaming music golden child in action. 

Going off of what Spotify has previously said, US users will have access to the free service for a limited number of hours each month — likely around the 40 hours that Pandora gives free users — and for anything beyond they will be required to pay for premium service levels. There are still a lot of labels to approach, but it is a solid start for the European streamer.

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The Beatles on iTunes: 5m Songs, 1m Albums Sold

From The Online Reporter   

 

Despite some initial concerns over successes, the Beatles are continuing to set the bar as high as can be on iTunes, selling more than five million songs in less than two months. In the same time period, the group also sold more than one million full-length digital albums.

Hudson Square Research analyst Daniel Ernst said “It’s a good number [though it] does not impact Apple’s numbers in any way that’s measurable, but still a nice print.”

Each of the Beatles’ 13 albums was remastered for digital release and, along with the recordings, Apple designed a new, full-album experience featuring images, lyrics, photos, video features and a mini-documentary about the birth of each album.

The most popular song download is “Here Comes the Sun,” from 1969’s “Abbey Road,” which is also the band’s top-selling album on iTunes.

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Clarification on Availability of MoCA STBs in US

From The Online Reporter   

In the US, of the nation’s 110 million or so homes that
subscribe to pay-TV, 70% get it from a service provider that
is deploying MoCA-capable STBs. The notable exceptions are
AT&T, over 70 smaller telcos in North America like CenturyTel,
which recently acquired Qwest and Bell Canada plus some in
Asia, all of which use HPNA network technology. With DirecTV
having adopted MoCA for use in its whole home DVRs, almost
100% of US homes could get DVRs with MoCA if they subscribe to
DirecTV. Liberty Global in Europe has said it’s going to
deploy DVRs with MoCA.


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Motorola Xoom Has Strengths the iPad Doesn’t

As the largest maker of Android-based smartphones, Motorola
has shown that it can compete against Apple. It and its
upcoming Xoom tablet have several strengths:

- Xoom uses the new tablet version of Android called
Honeycomb, not the older smartphone-centric Android 2.2. It
plays Flash videos, unlike the iPad. Users will be able to
access the Android app store.

-The hardware is powerful: a dual-core processor, hi-res
1,280x800 display and dual cameras.

- From day one it runs on Verizon Wireless’ 3G network and
will soon use the more Internet-friendly 4G network. Unless
Apple pulls a surprise with its next iPad, Motorola will have
the only 4G tablet on the market for a while. The 4G appeal
will depend a lot on Verizon Wireless’ 4G rates.

The Motorola brand name is no Apple, but it’s well known and
creates a positive first impression. And, the company is
willing to spend lots on advertising.

There’s one more factor, and that is tablets frequent use in
the living room while the user is watching TV. Motorola makes
STBs for pay-TV companies. It could convince them, starting
with Verizon FiOS, to stream a subscriber’s pay-TV to the
Xoom. Xoom could also display TV shows’ related metadata and
provide interactive services like voting and responding to TV
commercials. It’s a technology that Yahoo showed at CES and
one that Google with its advertising proclivities is certain
to be developing also.

Motorola already has many of the accessories that iPad lovers
buy in large quantities like a dock and Bluetooth keyboard.

However, Apple still has some significant advantages: its
iTunes download service, the number of apps and a single OS on
all its products. Oh, and Apple controls its OS, unlike every
other tablet maker except HP and RIM.


Third-Party Apps to Get Access to Apple AirPlay

Macworld reports that Apple has released to developers a beta
version of iOS 4.3 beta that allows third-party apps to use
Apple’s AirPlay, which streams from Apple devices to other
Apple devices and to surround sound systems like Denon’s and
Marantz’ that have an AirPlay chip embedded. Currently only
iPad embedded apps like iTunes, Safari and YouTube can use
AirPlay. The publication also said that the iOS 4.3 beta has a
pre-release version of new software for the latest $99 Apple
TV.

HP's WebOS Tablet Coming February 9

From The Online Reporter   

- VP Exec: Tablets Won’t Cannibalize Laptops

There are two kinds of people in the world, someone said, the ins and the outs. The outs want to get in and the ins want to keep them out.

Despite being the largest computer company, HP is an out when it comes to tablets, what with its Windows 7 and WebOS tablets not even showing up at CES.

HP this week will show its first WebOS-based tablets, which it calls slates, on February 9, the company said in an interview with the CNBC business TV network. It said it would also announce other innovative initiatives and devices.

Todd Bradley, executive VP of HP’s personal systems group, said in the interview, “We are totally focused on the tablet market, totally focused on enabling that with WebOS, which we bought over the summer from Palm. We believe that the tablet is one piece of that ecosystem, one piece of the connected experience that we are going to create. So, we will announce February 9.” He said the company would also announce broadly the future of WebOS and the types of products that it will affect and enable.

HP may not have wanted to get lumped in with the 50 or more other tablet announcements at CES.

Bradley said, “WebOS was the strategic reason we acquired Palm over the summer,” he said. “The WebOS is the first truly Web-based operating system that is differentiated from anything that is on the market today. It is very feature-rich with products like Synergy that allow you to access multiple accounts simultaneously: your Google account, your Facebook account, your Twitter account and your CNBC Universal account. It is the only true multitasking mobile operating system. We can have twenty different applications working simultaneously. We think about how that enables everything from smartphone to tablets to PCs to other large-screen devices.”

It’s noteworthy that he included PCs, perhaps as a replacement for the still-emerging Chrome as an always-connected OS for cloud computing.

HP previously said it would also use WebOS in a line of network-connected printers.

It’s expected also that the WebOS that HP shows will have significant improvements over what it had when HP acquired Palm.

There’s a big but.

If you’re not dominant in laptops, as Google and Apple were not, you’ll do whatever it takes to enhance tablets so that they cut into the laptop market. You might not be as aggressive if you have a dominant market share in laptops as HP has.

Bradley said HP does not believe that tablets will cannibalize the laptop/netbook market. But, HP wouldn’t say so even if the company believed that, would it? He said the company believes in the shift to always-connected devices but that tablets are only one form factor. Desktop and notebook PCs will be used to create content and for productivity applications. Tablets will only complement them, he said.

“We are not moving away from the PC,” Bradley said. “Our focus is really connected devices. They are portable, mobile. Let’s just say that the world is now mobile. Our focus is how do we create that connected experience that allows you to safely and seamlessly access the content that is important to you? The differentiation between tablets and PCs is that tablets are phenomenal for content consumption and PCs are great for content creation.” 

 

Bradley should have seen all the people at CES who were typing on tablets, almost all iPads. One person, who had an iPad case that came with a built-in flip-out external keyboard, said “everyone” had asked him where he bought it. It doesn’t sound like they’re looking for a laptop, does it?

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This Week in Content Deals

From The Online Reporter
Companies	Details
Shazam, Spotify	Mobile music identification platform Shazam partnered with streaming company Spotify to allow users to instantly stream songs they identify using Shazam on Spotify.
The Sundance Institute, Brightcove	The Sundance Institute inked a deal with video platform Brightcove to handle new live and on-demand video offerings for the 2011 Sundance Film Festival.

This Week in Finance Deals
Companies	Details
OnSwipe, Spark Capital, ENIAC Ventures, Betaworks	Tablet computer publishing service developer OnSwipe landed $1 million in a round of funding led by Spark Capital, with ENIAC Ventures, Betaworks and angel investors also participating.
Kajeet	Kids pay-as-you-go cell phone provider Kajeet secured $181.1 million in a mixed offering comprised of equity and notes involving four undisclosed investors.
SnagFilms, New Enterprise Associates, Comcast Interactive Capital	Documentary film digital distribution site SnagFilms closed a new round of financing with $10 million from new backers New Enterprise Associates and Comcast Interactive Capital, and prior individual investors.
Sonian, Amazon	Cloud-based data archiving service Sonian landed $9 million in Round B of funding led by Amazon.
Komli Media, Norwest Venture Partners, Nexus Venture Partners	Asia Pacific digital media network operator Komli Media secured $15 million in a round of financing led by Norwest Venture Partners, with prior investors Helion Venture Partners and Nexus Venture Partners also participating.
Cheezburger Network, Foundry Group, Softbank Capital, Madrona Venture Capital, Avalon Ventures	Online publishing conglomerate CheezburgerMadrona Venture Group and Avalon Ventures. Network raised $30 million in financing from investors Foundry Group, Softbank Capital,
Cox Digital Solutions, Internet Broadcasting	Cox Communications digital media arm Cox Digital Solutions purchased the business and ad sales unit of Internet Broadcasting in an undisclosed deal.

Intel Moves Ahead in Smart TVs, Chrome Laptops at CES

From The Online Reporter  

- Takes Direct Aim at ARM with New Atom Processors
- Microsoft, Sony Recede in Digital Media 

Ten years ago, Intel, Microsoft and Sony dominated the digital market, but they don’t anymore. At CES this year Microsoft and Sony were notable only for their failure to raise even an eyelid in tablets and smart TVs. 

However, Intel showed liveliness in its booth with an array of Atom processors for smart TVs, laptops/netbooks and tablets.

 Microsoft’s CES booth and CEO Steve Ballmer’s keynote heralded the company’s accomplishments with the widely-acclaimed Windows 7 and the hot-selling Kinect motion sensor for Xbox 360. A lengthy demonstration of a phone with WP7 was impressive but did not create a “must have” feeling. Sony was visible more for its 3D TVs and Blu-ray players than anything else. Showing how far it has fallen behind in digital media is its Qriocity online video and music service, which is available only on a few high-end Sony TV sets. 

Intel Chip-Set

At the front of Intel’s booth were two laptops with the new Google Chrome OS. One was unnamed, probably a prototype from Google. Boot up times took about 8-10 seconds, which includes connecting the browser to the Internet. Intel said battery usage is about 8 hours and resuming after sleep is instantaneous.

The thing to know about Chrome OS is a) the browser is the OS and the OS is the browser and b) all apps and all data are on the Internet, the cloud. There is no local storage except what’s needed for caching.

When we reviewed Chrome last month it looked like it was aimed at the corporates who want a) low-cost, trouble-free devices for their road warriors and telecommuters and b) want to keep apps and data on the IT department’s servers. Last month Google said it expects to have an offline version of Google Docs available early in 2011.

Google’s Chrome product manager, who was coincidentally visiting the Intel booth at the same time, was quick to say that consumers will be Chrome prospects too because they are rapidly moving to the cloud for data storage and apps. That’s shown by the instant and surprising popularity of tablets.

Chrome can also run on devices with ARM-designed processors, but both Chrome PCs in Intel’s booth had the company’s Atom-based processors. They would, wouldn’t they?

Not wanting to be lumped in with the notoriously underperforming netbooks, the Google executive was quick and emphatic in saying they were laptops, not netbooks. Of course Chrome OS can run on the same hardware as netbooks or even less considering they cannot have a hard disk. There’s no reason that it couldn’t be on desktops too, especially in places like businesses, schools and at medical care facilities such as hospital nursing stations.

It’ll be interesting to see how Chrome PCs are priced — our guess is that it’ll be priced pretty low — and whether they appeal to consumers.
No one is saying, at least publicly, that Chrome could give Microsoft a run for its money by replacing Windows. Windows is too firmly entrenched; there are many custom apps for it and Windows 7 has proven to be the best Windows since Windows 2000. On the other hand, Android smartphones have become as dominant as the iPhone, far exceeding even what Microsoft might dream of with Windows Phone 7 (WP7).

Microsoft provided sales figures at CES for a number of its products like Windows 7 and the Kinect motion sensor (8 million) for the Xbox 360, but none about WP7 handsets. In December Microsoft said that 1.5 million WP7 handsets had shipped, but that was to cellcos, not sales to end users. Remember that Verizon Wireless shipped all its Microsoft Kin social phones back to Microsoft a few months after it launched earlier this year?
Windows has a much tighter grip on the PC market and a much larger installed base of PCs and applications. Still, you can make a case for Chrome to begin inching into the PC market although slowly at first.

 Intel in the Living Room

In his talk at CES, Intel CEO Paul Otellini said the company is fulfilling the prediction he made two years ago that “personal computing” is expanding to nearly every kind of device, a process that he said will transform Intel and the industry. It was reminiscent of Microsoft’s then CEO Bill Gates a number of years back with his well-publicized epiphany that the Internet would change the industry and his successful effort to make Microsoft a major player in the Net market.

Intel’s problem is that it has been slow to develop the low-power usage processors that are a must-have in a mobile world, thus allowing ARM-designs to dominate in smartphones,tablets and smart TVs. Intel says it’s now ready to challenge ARM-designed chips head-on.

So far its Atom processors have not had a successful run in tablets and smartphones but, based on the products in its CES booth, they are making inroads in the living room. It was showing various manufacturers’ boxes that were connected to TV sets, most of which used processors based on Intel’s low-cost Atom Media CE processor platform that is optimized for video.

Intel said it’s developing full system-on-a-chip (SoC) CE media processors that will be used in smart TVs and connected CE devices such as Blu-ray players and digital media adapters. It described them as providing “excellent performance for advanced user interfaces and software development platforms such as Adobe Flash, Intel’s Widget Channel, TV widgets and other apps like online gaming.”

Its newest SoC, once codenamed Sodaville, is called the CE4100. It includes a media processor and audio/video graphics components. It supports on one chip Internet and broadcast applications and can be used in IPTV STBs, smart TVs, Blu-ray players and digital media adapters.
Otellini showed a yet-to-launch STB from Orange (France Telecom) that can be used to watch linear and on-demand TV plus Internet videos and personal content including 3D video. The user interface is also 3D.

Intel TVs (Yes, Plural)

The most notable TV adapter in the Intel booth was the Acer TV box, on which we reported last week.

Iomega TV

Also on show was EMC’s Iomega TV adapter, which incorporates Boxee technology like D-Link’s Boxee box does, except it has a HD with up to 2TB for storing personal media and can be a DLNA server. The Iomega TV has Boxee’s entire and very impressive array of online services. Boxee does not yet have Netflix and Hulu Plus, but they’re expected by the time the Iomega TV starts shipping in February.

The Iomega TV can be used as a DLNA server and a private cloud at home and away. Like the comparable Boxee box that D-Link makes, it has the same UI, the same Intel CE4100 processor, and a two-sided remote with a QWERTY keyboard on one side. It has Wi-Fi 802.11n built-in and RCA, HDMI and optical audio connectors. The 2TB model is $349.99, the 1TB is $299 and the one without storage is $229.99.

Amino TV

There was a TV adapter box made by Amino Communications called Cubovision with Telecom Italia stamped on it that brought over-the-air broadcasts, over-the-top video services and pay-per-view but no subscription service. It has icons for frequently-used online video services and a 250GB drive for storing personal content. There is no browser and no search so it stops short of being a Google TV. There is no subscription fee. Shipments started in December at €199 ($266).

Also in the Intel booth was an Amino STB that was built specifically for France’s Free pay-TV service and broadband service provider. It serves as a home gateway and comes with DSL and fiber connections, a phone jack, four Ethernet ports and a USB port. Amino said it produced the box, based on its Freedom Jump design, in one year, from start to finish.

Amino, which makes IPTV STBs for many telcos, has recently obtained orders from Vodafone Iceland and the Ukraine’s Velton Telecom.
Amino CEO Andrew Burke said, “There is a real gap in the market for a powerful low-cost device that works with — rather than competes against — pay-TV operators’ existing pay-TV devices.” He said pay-TV operators want to counter cord-cutting by meeting consumers’ changing viewing habits. They want to offer subscribers, he said, “a companion device that blends seamlessly with their own user interface and branded customer experience.”

Among his predictions are that Google will get content from the TV networks, pay-TV services will begin offering OTT services and catch-up TV like Hulu and YouView will account for upwards of 40% of the broadcast TV that subscribers watch. He said, “The new TV landscape will probably not materialize for the next five years, but I would strongly contend that the 2011 movers and shakers will buy themselves an opportunity to dominate that future landscape.”

Amino’s Freedom Jump boxes use Intel’s Atom 4100 processor and the MeeGo OS that Intel and Nokia developed. It also uses Microsoft’s Bing search instead of Google or Opera.

Conceptronic TV

Holland-based Conceptronic was showing its YuiXX, an HD media player/IPTV STB and platform that uses Intel’s Media Processor CE 3100, a system-on-a-chip developed for CE gear in the home. It offers access to personal content stored on the home network and a Widget Channel for access to online video services, “bringing together media, information and community.”

The company said YuiXX “goes beyond existing TV Widget implementations by presenting all widgets in stunning HD.” There’s also a YuiXX widget store for apps such as video-on-demand, news, traffic information, weather and games. It offers both local (country dependent) and globally-available content.

It has a 2D/3D graphics processor for up to 1080p resolution and supports DTS and Dolby audio support, both pass-through and down mix. It searches for local content by artist, title, genre and the like and searches over multiple HDS on the network.
A YuiXX media widget can be displayed as a sidebar on the TV while watching something else or full-screen.

The company offers different tuner types for multiple countries and is compatible with ISPs, telcos or cable TV services. A built-in smart card reader allows consumers to use smart cards of their current providers in the YuiXX and have a single STB for multiple services.

It has DRM protection for such inputs as TV channels, VoD over IPTV or DVB-T, DVB-C, DVB-S tuner or ATSC tuner.

The company said the YuiXX boots up in about 5 seconds.

It can have an internal 2TB HD or the user can connect an external hard disk or an SD(HC) memory card.

The company said it would add functions such as Internet browsing, more codecs, network features like using the box as a network storage device (NAS) and EPG settings.

Suggested retail in Holland is €299 without an HD or €399 with a 1TB internal hard disk.

It said that together with two other Dutch companies, manufacturer ProDrive and integrator Metrological Media Innovations, Conceptronic will market the YuiXX globally.

Intel Connects

Intel showed two products that improve the connection between devices, neither of which were brand new.

Intel Wireless Display, WiDi, can be built into laptops that have its 2010 Core Processors. A hotkey on the laptop starts a video stream to a TV set that has a WiDi adapter connected like the one that Netgear sells. Dell, Sony and Toshiba make laptops with WiDi built-in.

Light Peak technology, a next-generation wireline method for connecting devices, uses optical wires rather than copper to transfer data at speeds of up to 10 Gbps next year and up to 100 Gbps in the future. At 10 Gbps it would take about 30 seconds to transfer a Blu-ray movie between devices. Initial products are expected in 2012. It raises the question of what will happen when the transmission speed between devices is faster than the hard disk’s ability to read and write data. Perhaps by then all device storage will be on solid-state drives (SSD), which Intel also makes.

And...

Intel has been a pioneer in smart TVs, perhaps even the pioneer. As best we can tell it coined the term “smart TV.” It partnered with Yahoo three years ago to produce a smart TV platform that’s on TV sets from the likes of Vizio, Panasonic and Sony. It’s the hardware partner in Google TV. It jointly developed with Nokia the MeeGo OS that is expected to run many smart TVs like the ones from Amino. Intel may be on its way to dominating in smart TVs in the same way it did in PCs.

Now let’s see what it can do in tablets. There were five at CES that used Atom processors: Archos A9, ViLv X70EX, Hanvon and Panasonic’s Toughbook CF-H1 Mobile Clinical Assistant. They are not a factor in the tablet market, but Intel intends its Atom processors to be.

For now Intel is doing very well in smart devices for the living room. 


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