Now playing at Comdex: The Home PC-TV
Comdex is the world's largest computer trade show, but during Compaq Computer Corp. CEO Eckhard Pfeiffer's keynote Monday, all attention will turn away from the PC. And it will rivet on something else that rolls onto the stage -- a TV.
In the spotlight will be Compaq's PC Theatre, a computer and large-screen television wrapped in one. In Compaq's vision, these two devices will marry -- then sire the future of consumer electronics. The progeny: A Great Box of entertainment and information in the living room.
And Comdex will be the venue where Compaq gives the already released PC Theatre a marketing push into new markets.
It's been a union long rumored -- the linking of digital interests between Silicon Valley and Hollywood -- but now the marriage appears to have been consummated. Led by Microsoft Corp., software and hardware companies are investing significantly in the new medium. Component makers are designing the necessary chips, analog-to-digital converters, and display equipment. Even the government is playing a role, by requiring broadcasters to adopt digital broadcast technology starting next year.
"I think it's finally starting to happen," says analyst Jonathan Cassell of market researcher Dataquest.
But most of the PC-TV news at Comdex will come from back rooms rather than the show floor. After all, Comdex is targeted at corporate computer buyers. So major players in the computer-TV convergence market -- including WebTV Networks Inc. and Oracle Corp.'s Network Computer Inc. -- won't even have exhibits. Microsoft, too, plans a low-level effort when it comes to digital TV at the show.
But all three will have representatives in attendance, looking for deals and likely granting back-room peeks at their latest technologies.
Other ventures will be more high-profile. Sony is expected to announce a new chip set for digital TVs. Zenith Electronics Corp. is planning to show new digital TV technology as well, sources say.
And it will be an important show for Compaq and Gateway 2000. Both have made significant investments in their PC-TVs, but neither has generated many sales.
Compaq, which introduced the $5,000 PC Theatre in a quiet rollout in late spring, now wants to target the corporate and education markets, said Jeff Lininger, manager of product marketing. And Gateway will show off its $5,000 Destination "Digital Media Computer," a PC-TV tweaked with DVD and Internet smarts.
Microprocessor maker Cyrix Corp. will try to bring down the cost of the box by unveiling the chip underpinnings for a $999 TV that also plays DVD movies, answers the phone, plays 3-D games, and is equipped with a six-speaker Dolby Surround sound system.
Still, some analysts are skeptical that these hybrids will be successful with the mainstream. "I don't see it blossoming," said Sean Kaldor, an analyst with market researcher International Data Corp. "You don't write a letter or use Excel in the living room."
More marketable, he said, is so-called enhanced TV technology, in which the television image shrinks to make room for printed information delivered over cable -- an actor's bio, a player's batting average, or a Star Trek trivia contest. Both Microsoft and Network Computer Inc. are developing technology in this arena.
In fact, bets are being placed all over the landscape. On Monday, Motorola and TV research pioneer Sarnoff Corp. announced they will co-develop cheap chips for interactive television sets. The first TVs with Motorola-Sarnoff chips are anticipated next year. On Tuesday, Philips Electronics N.V. announced the DVX8000 Multimedia Home Theater, a $10,000 PC-TV that features a DVD player, cinema-quality audio, and a 233MHz Pentium processor .
In the end, however, it won't be technology that drives consumer acceptance of the computer TV. It will be technology that meets consumer needs, said analyst Cassell.
"First, consumers do want this, but at very low hardware costs. And two, they want something that directly enhances their experience of the TV -- they don't want just Web surfing," said Cassell.
Whether or not the industry can deliver, we'll start to see at Fall/Comdex 97.