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Yep. It's watermarks for the lot of 'em.eom
Music biz seeks digital radio limits
Industry worries CD quality sound could lead to unhindered song copying, seeks copy restrictions.
June 11, 2004: 1:58 PM EDT
WASHINGTON (Reuters) - Digital radio broadcasts that bring CD-quality sound to the airwaves could lead to unfettered song copying if protections are not put in place, a recording-industry trade group warned Friday.
Without copy protections, music fans could cherry-pick songs off the air and redistribute them over the Internet, further deepening the copyright woes of record labels, the Recording Industry Association of America said.
U.S. regulators at the Federal Communications Commission should ensure that the broadcast format limits such copying so radio stations don't turn the airwaves into a giant file-sharing network, RIAA officials said.
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"A little bit of prudence right now goes a long way," RIAA CEO Mitch Bainwol said in a conference call.
Digital radio promises to bring CD-quality sound to FM stations and FM-quality sound to the AM band, along with "metadata" like artist and song information. Broadcasters also can use the standard to broadcast several signals at once.
Roughly 300 stations now broadcast digital signals or are in the process of setting them up, according to the FCC.
RIAA officials said digital-radio players could soon allow listeners to record certain songs automatically when they are broadcast, allowing they to build a free library of music they otherwise might pay for and distribute it to millions of others over the Internet.
Players already on the market in Europe, such as Pure Digital's "The Bug," allow users to pause and rewind broadcasts and record them digitally.
Under restrictions proposed by the RIAA, listeners would be able to record digital broadcasts for later playback, but would not be able to divide that broadcast up into individual songs.
Listeners would also not be able to program their players to record certain songs, or redistribute those recordings over the Internet.
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The RIAA plans to submit its proposal to the FCC next Wednesday.
XM Satellite Radio Holdings Inc. (XMSR: Research, Estimates) and Sirius Satellite Radio Inc., (SIRI: Research, Estimates) which broadcast digital signals by satellite, do not pose the same risk because those companies would be hurt by song copying and thus have an incentive to limit it, RIAA officials said.
A spokesman for iBiquity Digital Corp., a privately held company whose broadcast technology was selected as the standard for the medium, was not immediately available for comment.
The RIAA represents the world's largest record labels, such as Warner Music, Bertelsmann AG's BMG, EMI Group Plc, Sony Corp.'s Sony Music and Vivendi Universal's Universal Music Group.
--------------------------------------------------------------------------------
Apple Readies Next-Gen MPEG-4 Part 10
By Michael Singer
June 11, 2004
Apple Computer (Quote, Chart) is currently testing new video compression software that will eventually improve its QuickTime Player.
The company said the technology, known as MPEG-4 part 10 or H.264/AVC, is the next-generation video compression technology in the MPEG-4 standard. Already ratified by both the ITU and ISO MPEG, Frank Casanova, Apple Senior Director, QuickTime Product Marketing, told internetnews.com that the company is pole-positioning the improvements as the standard for video encoding for everything from 3G to High Definition (HD) broadcast.
"We took the basic recipe and we're now testing it internally on our campus in Cupertino, Casanova said. "We're not shipping it yet. It's not a question of 'if', only a matter of 'when.'"
Earlier this year, Apple demonstrated MPEG-4 part 10 showing content encoded at full HD resolution (1920x1080 24 frames progressive) and played back between 6.8 and 8 Mbps on one of Apple's current dual-processor computers. The company suggests that H.264/AVC is the likely successor to MPEG-2, which is still the industry standard.
MPEG-4 has come into conflict in the past with Microsoft's Windows Media Player 9 and its FastStream technology, which like Apple's Instant-On, eliminates buffer delays. Earlier this month, Microsoft released its Windows Media Player 10 beta with digital rights management technology, code-named Janus. The technology, expected to ship later this year, will also feature full support for the coming Portable Media Center.
"Apple's pursuit of standards is a new leaf for them," Mike McGuire, Gartner Research Director, told internetnews.com. "Their view is that digital media is going to extend to other formats and players and they are looking at the new opportunities for distribution channels. That long-term strategy is an interesting opportunity for them."
McGuire said the key for Apple is its work to push its QuickTime Streaming Server as a backside technology.
"They don't take for granted that Europe, Japan and the Asia Pacific regions have been demanding more content on their mobile phones," he said.
The Cupertino, Calif.-based computer maker is beaming about the progress that QuickTime has been making compared to alternatives like Microsoft (Quote, Chart) Windows Media Player and RealNetworks (Quote, Chart) Real Player.
A recent report on media player market share sales for client and enterprise applications by research firm Frost & Sullivan showed Apple moving into second position with 36.8 percent of the market, after running a distant third a few years ago. That puts Apple above Real, which controls 24.9 percent and not too far off from Microsoft and its share of 38.2 percent.
Casanova said the market share does not include formats such as enhanced CDs, digital camera support software, end-user titles, PDAs like the Sony Clie, or even AOL 9.0 because tracking the sales is too difficult for any of the three players to track.
Apple also issued a statement Thursday saying more than 250 million copies of QuickTime version 6 have been downloaded since its 2002 release.
Frost & Sullivan industry analyst Mukul Krishna said almost everyone has all three players on their computer, not wanting to be locked into just one format.
"The only impediment is infrastructure," Krishna said. "There are still a whole lot of analog products but that has been changing as the FCC started its push for the digitization of content."
Krishna pointed out that the main determining factor when choosing a media player will be how well it handles Video over the Internet (define) and applications build for the mobile market.
"The feedback we have gotten is that analog is enjoying continued support," he said. "Windows Media Player 9 and QuickTime with MPEG 4 will be there in the future but there is a slight bend towards Apple's MPEG 4 because it is a non-Microsoft product."
In related news, Apple updated its iTunes music player to version 4.6. The upgrade helps support the company's AirTunes music sharing software. Casanova said Apple's iTunes platform is a major factor in the spread of QuickTime.
OT Statewide Internet ‘Hotspots’ Proposed By TxDOT
FOR IMMEDIATE RELEASE, May 26, 2004
AUSTIN - Texas is the first state in the nation to provide free wireless Internet access at its safety rest areas, the Texas Department of Transportation announced today.
TxDOT began experimenting with wireless Internet service last fall, when the department provided the capability at twin rest areas on U.S. 287 in Donley County. Free wireless service also is available at two rest areas on the same highway in Hardeman County.
“The feedback we’ve received so far has been very positive,” said Andy Keith, Safety Rest Area Program Manager for TxDOT’s Maintenance Division. “Texas’ highways are seeing an increasing number of business travelers, truckers and RVers and access to email is important to them. They have really responded favorably to our four ‘hot spots’ on U.S. 287.”
TxDOT has taken the first step to expand the service to all of its 84 safety rest areas and 12 Travel Information Centers by issuing a request for offer seeking vendors able to provide free wireless Internet service and pay telephone-like Internet access at kiosks.
Keith said he envisions computers in the kiosks being available in 15 minute increments by swiping a credit card through a reader. But wireless access will be free for anyone with their own equipment.
“Over 50 million people a year visit our rest areas,” Keith said. “When we get this program up and running, anyone with wireless equipped laptops or other devices will be able to send email or browse the Internet for free at our safety rest areas and travel information centers. People not traveling with wireless equipment will be able to connect to the Internet at kiosks for a reasonable fee to be collected by the vendor.”
“We think this will be a huge win-win for Texas’ travelers,” Keith said. “Knowing free Internet service is available at our rest areas will get drivers to make regular stops. Since fatigue is a factor in 1.5 percent of all crashes, anything we can do to get people to pull off the road and take a break is going to make our highways safer.”
An estimated 1,500 people die in fatigue-related crashes each year in the United States, according to National Highway Traffic Safety Administration statistics. An additional 77,000 are injured.
Any firm in the business of providing wireless Internet service has until 3 p.m. June 25 to make an offer to TxDOT for evaluation. TxDOT will then review the offers and award a contract. Interested vendors can find more information about this by downloading the request for offer or by calling (512) 374-5444.
“The safety rest areas are there to make the roadways safer for today’s traveling public,” Keith said. “Wireless Internet access meets the modern traveler’s needs so we want this to happen as quickly as possible.”
OT Nanotech Memory Chips Might Soon Be a Reality
By BARNABY J. FEDER
Published: June 7, 2004
http://www.nantero.com/mission.html --very cool movie on the
operation of NRAM
Nantero, a start-up developing memory chips using nanotechnology, and LSI Logic, a leading maker of specialty microchips, are expected to announce today that they have transferred Nantero's technology to a standard semiconductor production line.
Nantero is creating NRAM, a high-density nonvolatile random access memory chip, which it hopes will replace existing forms of memory. Its technology, using cylindrical molecules of carbon known as nanotubes, will be used on a production line in LSI's semiconductor factory in Gresham, Ore.
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Carbon nanotubes are among the new forms of carbon, known as fullerenes, whose discovery helped ignite interest in manipulation of materials at the molecular level, the field known as nanotechnology. Fullerenes consist of carbon atoms arranged in patterns resembling the nodes of the geodesic domes designed by Buckminster Fuller. Nanotubes, which researchers first created in 1991, consist of single- or multiwalled cylinders that can be less than 10 nanometers wide. A nanometer is one-billionth of a meter.
The transition from laboratory to production line took more than nine months, the companies said, adding that considerable work remains to improve the chips.
"But it's following the same type of road map as any other semiconductor product," said Norman L. Armour, vice president and general manager of the LSI factory in Gresham. Mr. Armour said that processors embedded with carbon nanotube memories in place of static random access memory, or SRAM, could be supplied commercially from the factory's pilot line next year if no problems developed.
If so, analysts said, such devices could emerge as one of the first products to exploit something other than the extraordinary strength of carbon nanotubes.
The nanotubes are up to 100 times as strong as steel and one-sixth its weight, qualities that have quickly led to their use in products like tennis rackets and automotive plastics, where they are mixed with other materials to improve their performance.
Researchers have also shown that the nanotubes have extraordinary electrical and magnetic characteristics. Recent reports, for example, have highlighted their ability to be quickly altered from metal-like conductors into semiconductors and back by applying magnetic fields.
Such novel qualities have helped make them a powerful symbol of nanotechnology's potential, but except as strengtheners nanotubes have proved difficult to bring to market. The challenges have included preventing clumping and the tendency of the simplest manufacturing approaches to produce mixes of single-walled and multiwalled tubes with varying characteristics.
Nantero's design applies charges to groups of single-walled nanotubes suspended over an electrode. Applying opposite charges to the tubes and the electrode causes the tubes to bend down, creating a junction that represents a 1. Applying like charges forces them apart into the 0 state. As with all digital memory, NRAM stores data as a pattern of 1's and 0's.
Carbon nanotube memories could sharply improve the performance of cellphones, laptop computers and other electronic devices. Like today's flash and SRAM memories, carbon nanotube designs can maintain data when power is turned off, an advantage over dynamic random access memory, or DRAM, memory chips, which must constantly be refreshed. But it can operate considerably faster and on less power than flash memory, and is much cheaper and more compact than SRAM.
Analysts caution that Nantero's carbon nanotubes face plenty of competition. Memories that hold their charge are crucial to improving the performance and design flexibility of a wide range of electronic products, and thus have become the most profitable and fastest-growing segment of the $35 billion memory market, according to Radu Andrei, a Web-Feet Research analyst based in Dallas. That is attracting heavy investment in technologies that could replace flash and SRAM.
"I count around 30 technology variations trying to get a piece of that pie," Mr. Andrei said. Among them are I.B.M., Intel, Motorola and numerous start-ups. Flash memory is now so inexpensive, he added, that innovators will have a hard time displacing it from all but the most demanding applications even if they surpass it technically.
http://www.nantero.com/
http://www.nantero.com/mission.html --very cool movie on the
operation of nram
Next content for digEplayer..IMO Record eBook Retail Sales Set in Q1 2004
(we can go audio and/or text versions w. multimedia!)
Dan Brown’s The Da Vinci Code Tops Bestselling eBooks for May
Book Expo America, Chicago, IL – Friday, June 4, 2004 – Among the 2,000 exhibitors at Book Expo America in Chicago this week, publishers, retailers and technologists are celebrating a new quarterly record for eBook retail sales. eBook units sold for the first quarter 2004 were up 46% and eBook revenues were up 28% over the same quarter in 2003. These and other figures charting the eBook industry are reported in the quarterly Open eBook Forum (OeBF) eBook Statistics Report.
“This quarter eBooks have hit a new high mark for sales,” stated Open eBook Forum President Steve Potash. “eBooks represent the fastest growing segment of the publishing industry,” he added.
The OeBF’s eBook Bestseller list for May was also released today with Dan Brown’s The Da Vinci Code topping the list for the third straight month. Kevin Ryan’s Van Helsing, Dan Brown’s Angels & Demons, The Da Vinci Code: Fact or Fiction and Ian Caldwell and Dustin Thomason’s The Rule of Four rounded out the top 5 eBooks on the list. The top 30 bestselling eBooks for May can be found on the Open eBook Forum website at www.openebook.org.
“In addition to terrific sales and traffic growth to our web store, we are also seeing fast growth in new audience segments, especially to women customers,” said Mike Violano, Vice President and General Manager of eReader.com.
Compiled from data submitted by 24 of the world’s leading eBook publishers and retailers, the analysis combines both quantitative and qualitative assessments of the electronic publishing industry. Among the study’s findings are:
Retailers:
· Unit Sales: A total of 421,955 eBooks were sold in Q1 2004 alone, a 46% increase over the same period in 2003, during which time 288,440 units were sold.
· Revenues: $3,233,220 in sales have been logged by retailers in Q1 2004, a 28% increase over the same period in 2003 during which time retailers reported $2,516,469 on sales of eBooks.
A detailed report of the full survey findings and archived reports from 2002 and 2003 are available to OeBF Members only and companies who contributed to the reports. Details on OeBF membership can be found at www.openebook.org.
Publishers and retailers that contributed to the 1st quarter 2004 survey are: eBooks.com, Elib, E-Reads, Ltd, Fictionwise.com, Inc., Franklin Electronic Publishers, Hard Shell Word Factory, HarperCollines, Holzbrinck Publishers, John Wiley & Sons, Inc., Laridian, Love Kush Publications, Mobipocket, Mushroom eBooks, Numilog, OverDrive, Inc., Palm Digital Media, powells.com, RAND Corporation, Random House, Inc., Simon & Schuster, The McGraw-Hill Companies, Time Warner Book Group, WORDsearch and Zondervan.
The statistical reports released by the OeBF represent aggregate statistics submitted by reporting companies and does not represent the entire eBook publishing and retail industries. Participating companies that report to the program vary quarter by quarter and the report reflects this variability.
The OeBF collects and releases statistics quarterly. The next report will contain statistics for Q2 2004. All companies including non-OeBF members are welcome and encouraged to participate in the program. A registration form is located at http://www.openebook.org/statsregistration.asp.
Members of the media who would like access to the full report and charts should contact Nick Bogaty at 212-924-9081 or nbogaty@openebook.org
About the Open eBook Forum:
The Open eBook Forum, www.openebook.org, is an international non-profit trade and standards organization for the electronic publishing industry. The organization is supported by membership dues and the generous support of Adobe Systems, Inc., Microsoft Corporation, OverDrive, Inc. and Palm Digital Media.
An OeBF member list and membership information can be found on the OeBF Web site at www.openebook.org.
# # #
OT WestJet runs into turbulence
By MATHEW INGRAM
Globe and Mail Update
By now, investors have grown used to a certain pattern in the financial results of WestJet Airlines, in which the Calgary-based carrier routinely beats estimates for profitability, passenger traffic and so on, month after month and quarter after quarter. Unfortunately, that pattern ran into a wall with the latest news from the company. WestJet reported that its load factor – that is, the number of seats it filled on its planes – fell significantly in May compared with the same period last year, and the stock was downgraded by several brokerage firms.
Late Thursday, WestJet said that the overall capacity of its network — known as the available seat-miles or ASM — rose by 31.2 per cent in May, but its actual passenger traffic only increased by 18.3 per cent. As a result, the airline's overall load factor dropped to 65 per cent from 72 per cent, a substantial drop for the airline. The stock lost about 11 per cent of its value after the news. To make matters worse, Air Canada's traffic climbed 25 per cent in May on a 14-per-cent rise in capacity — producing an overall load factor of 78.5 per cent, its highest ever for the month.
The main reason for the drop in traffic, WestJet said, was that it cut the number of seat sales offered during the period, in part because it is trying to compensate for higher fuel costs without raising fares. "Although we are somewhat disappointed by this lower load factor," chief executive officer Clive Beddoe said, "it has come about ... as a result of WestJet reducing the number of seat sales we have intentionally offered in the market. We have pursued this approach as a way to improve yields without further increasing base fares in the face of the extremely high price of fuel."
It's not just jet fuel prices that have been eating into WestJet's business model, however. Price competition with Air Canada as well as startups such as Jetsgo and Canjet has been intense, and industry analysts say the Western-based airline is trying to restore some sanity in its price structure rather than getting locked into a price war forever. Scotia Capital said that the drop in load factor suggests that "WestJet is attempting to take a leadership role in pricing and has sacrificed traffic as a result."
One of the things that makes fighting a price war against Air Canada difficult for WestJet, of course, is that the country's national carrier is going through a financial restructuring, and during that process it is to some extent released from the usual concerns about profitability. In fact, WestJet has criticized Air Canada in the past for taking advantage of its restructuring in order to engage in pricing that wouldn't make sense if it were not protected from its creditors by the courts.
A lot of competitive pressure on prices has also been coming from Jetsgo, however, which has been running $1 promotions and seat sales in an attempt to steal market share from Air Canada and WestJet in the crucial Toronto-Montreal-Ottawa triangle. As a result of those competitive pressures and other factors, including rising costs, WestJet's first-quarter earnings missed Bay Street estimates by 6 cents a share. And to make matters worse, WestJet is continuing to add new planes and routes, and has moved its Ontario hub from Hamilton to the much more costly Pearson airport on the outskirts of Toronto.
All of these factors — fuel costs, price wars, new planes and an expensive airport — are putting the squeeze on WestJet, industry analysts say, and so the airline is trying to recover more from each ticket it sells in order to prevent its all-important "yield" from falling too much (as it did in the first quarter). But as Scotia Capital described it, WestJet is wrestling with a "load-yield tradeoff." If it keeps its prices low, its load factor may improve but its profitability will nosedive. If it tries to keep prices higher, its profitability looks good but then its load factor deteriorates.
In the wake of WestJet's decision, Scotia cut its estimates and reduced its price target. The firm said it now expects the airline to earn 50 cents a share in 2004 instead of its earlier estimate of 60 cents, and 89 cents in 2005 compared with 96 cents. Scotia said that it believes "price competition will persist" whether it comes from Air Canada with its lowered cost structure once it emerges from court protection, or Jetsgo and other startups. Canaccord Capital also cut its profit estimates for the company and reduced its rating on the stock to "hold," saying May's traffic was "surprisingly weak" and that it was reducing its load factor estimates for 2004.
It remains to be seen whether Air Canada and Jetsgo will be willing to ease up on their price wars in the interest of protecting their own yields. RBC Capital Markets, which rates WestJet "outperform," said current prices in the market are unsustainable, and that Air Canada will have to raise fares so that it has enough cash on hand to act as a buffer when it emerges from court protection. WestJet is no doubt hoping that proves to be the case.
All flights between LAX and Washington D.C. will be equipped with Alaska's
digEplayer inflight entertainment system. The state-of-the-art system gives
Alaska's customers the choice of up to 20 full-length features including first
run movies and TV shows.
Alaska Airlines Inaugurates Nonstop Service From Los Angeles to the Nation's Capital Today
SEATTLE, June 7 /PRNewswire-FirstCall/ -- Alaska Airlines (NYSE: ALK)
began daily nonstop roundtrip service between Los Angeles International
Airport (LAX) and Washington, D.C.'s Reagan National Airport today, becoming
the only airline to fly the route.
"To say we're excited about this opportunity would be an understatement,"
said Gregg Saretsky, executive vice president of marketing and planning.
"Los Angeles is the largest city in the country without nonstop service to
Reagan. This will fill a huge void in the nation's transportation network and
we're proud to be the carrier to do it."
The carrier is using 120-seat Boeing 737-700 aircraft on the route.
Flights depart LAX at 12:30 p.m. and arrive in the nation's capital at
8:31 p.m. Westbound flights depart Reagan at 8:15 a.m., arriving in LAX at
10:50 a.m.
All flights between LAX and Washington D.C. will be equipped with Alaska's
digEplayer inflight entertainment system. The state-of-the-art system gives
Alaska's customers the choice of up to 20 full-length features including first
run movies and TV shows. Additionally, Alaska is offering double Mileage Plan
miles on the route through June 30.
Alaska, the nation's ninth largest carrier, and its sister carrier,
Horizon Air, together serve more than 80 cities in Alaska, the Lower 48,
Canada and Mexico.
For reservations visit http://www.alaskaair.com . For more news and
information, visit the Alaska Airlines Newsroom on the Internet at
http://newsroom.alaskaair.com .
Airline VOD signs up WB
Frog joins Fox, BV to provide content for Digeplayer
from variety online..any subscribers out there??
By BEN FRITZ
Fledgling airline entertainment company APS has signed Warner Bros. as the newest content provider for its Digeplayer, the first in-flight video-on-demand system.... WANT TO READ THE WHOLE STORY?
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TI...DRM..OMA
Dave's 2 cents on . . . digital rights management
You have the right to a ''0'' and a ''1.'' Possession of certain combinations of 1s and 0s may be used against you in a court of law. You have the right to digital rights management. If you desire such management and can't afford it, software will be provided for you.
I think we have become used the idea of rights as almost always being something an individual has that must be protected. In day-to-day life, we normally think that the purchaser, and not the supplier, must be protected. The principal concern is that duplication of information has never been as accurate or as easy.
Can we expect that someday a television sitcom will include a topic about digital rights management? It seems likely. It might go something like this: The main male character has finally convinced his wife that all their home entertainment equipment is antiquated and in need of an upgrade. This upgrade would include a new entertainment server and provide the highest level of entertainment suitable for his fondest love, actually his second fondest love right after the tech equipment he was about to purchase. He eventually connects the system, delayed by a few wrong turns that were corrected by peeling the plastic off of manuals and reading the appropriate pages.
Our main character then demonstrates how he could play music and movies on virtually every electronic appliance in his house, including his microwave oven and sprinkler system. His wife is unexpectedly impressed. Now he goes out of town, and you know this can't be good. His wife is ready to watch her favorite sitcom on the new bedroom wide-screen TV. She points the remote control at the monitor and presses all the logical buttons.
The monitor begins to display that the appropriate digital rights aren't available for this activity. Buttons are then pushed again, but the results are the same. How dare he restrict these rights while he had been able to watch whatever he wanted? Our main character returns home finding equipment looking a lot like the equipment he had recently purchased sitting on the lawn under a ''For Sale'' sign. He tries to enter his castle, but his key doesn't work and a voice from behind the door announces that the key he is using doesn't have the appropriate digital rights to enter.
Did we ever have ''analog rights''? We may have, but I'm not sure we were actually told about it. Maybe analog rights just weren't that important because copying analog just resulted in lower-quality analog. I wonder what level of copy fidelity is enough to make the creators uncomfortable. Is it only recognizable copy? Is it only a copy that you would have been willing to pay for, but not pay the asking price? I understand the Internet and digital communications will be more valuable if digital content and its value can be maintained. Preventing unintended use of personal information should also be a high priority. Several special interest groups and commercial entities are working hard to develop digital rights management software for the masses.
A good example of a digital rights management effort—focused on mobile devices—is the DRM specification defined by the Open Media Alliance, called OMA DRM. The OMA develops specifications for interoperability of portable digital media applications. The OMA DRM isn't a complete DRM, but is an interoperability framework that supports multiple DRM systems. Another group working on security and rights management for devices that can store and distribute digital media is the Trusted Computer Group (TCG). The TCG's work broadens the scope to all devices, not just mobile devices. The goal of both the OMA and TCG is to develop open standards that promote interoperability to protect digital media ownership rights and privacy while enabling digital transmission and storage.
For my two cents, digital rights management is important because it adds digital content to our activities. It needs to be unobtrusive and not require calls to a support center. Maybe the content providers could just not put their content in a digital format. That may solve some of the problems. But I think they want to take advantage of this media.
Dave Freeman is an analog applications engineer at Texas Instruments, based in Dallas, TX.
Portable Design May, 2004
Microsoft releases Media Player beta
By John Borland
CNET News.com
June 2, 2004, 10:39 AM PT
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Microsoft released the first test version of its new Windows Media Player software Wednesday, marking a significant upgrade aimed squarely at the burgeoning portable device market.
As previously reported, the revamped Windows Media Player 10, which will be released in final form to the consumer market later this year, contains substantial changes to the way music, videos and other media can be organized and retrieved. But the biggest changes in the new "technical beta" software will be invisible to most users until new portable music and video players reach store shelves this summer and fall.
"Our real rallying cry here for the player is letting you discover media, play it and take it with you," said Jonathan Usher, director of Microsoft's Windows Media Division.
The software, which incorporates recent advances in Microsoft's digital rights management tools and a new technology allowing computers to communicate with devices such as MP3 players, forms a key component of the company's response to Apple Computer's strong successes with its iPod music player and software.
One of the iPod's key selling points has been its extraordinarily simple ease of use, which lets people load the device with music without having to take anything but the most rudimentary technical steps.
The new Windows Media Player builds on that idea, adding the ability to automatically keep portable devices up to date with changing music and video and photograph collections on a PC.
Some of these automatic synchronization features will be available to a limited number of devices--largely those that Windows can view as an extra data drive--when the software is released on Wednesday. Those devices range from small, flash-based USB storage devices to larger hard-drive-based MP3 players.
More advanced features will be available with the release of a new generation of hardware later in the year, such as the Windows-based Portable Media Center, however. For those devices, the company has created a new technology dubbed Media Transfer Protocol, which will govern the automatic exchange and synchronization of media files.
Analysts said the tight integration between PC software and a wide range of portable media devices was a key goal for Microsoft, but that it would also be important for the company to match the iPod's ease of use. Because so many different hardware manufacturers use Microsoft technology, that goal could be difficult, they noted.
"Microsoft is clearly moving in the right direction," Jupiter Research analyst Michael Gartenberg said. "But the key here is that Microsoft will have to work with its partners to create something that's the equivalent of the iPod. None of (the rival products) have captured hearts and minds of consumers the way the iPod has."
The new software will also support new digital rights management features that allow subscription-based content, such as that from Napster, to be played on portable devices. Similarly, those features will not be available until the release of new hardware later this year.
Although many of the new Media Player's features will be muted until the release of new hardware, users will be able to browse through new ways of organizing media libraries and take advantage of a considerably simplified interface. The company said it wants to get feedback from "digital music enthusiasts" on those features before a final release.
Along with new customization features, the player will include a new "digital media mall" containing links to services such as Napster, MusicNow and CinemaNow that distribute online content in Microsoft's media formats. The company hopes that link, which replaces the "premium services" section in the old player, will help users find online content more easily.
[Op-Ed] Microsoft v. iPod: Is it the Software, Stupid?
by Remy Davison, Insanely Great Mac
June 1st 2004
The widely misreported, and sadly misunderstood, remarks of Yusuf Mehdi, corporate vice president of MSN at Microsoft, have set both Mac and PC sites alight with scornful derision of his purported "$50 music players...which will look and feel as good as iPod" remark.
Problem is, of course, Mehdi didn't say it. And he's probably keeping his head down and trap shut now. The more accurate version of his comments is here. (The full transcript is available from Microsoft here).
But stop. Read between the lines. Just what is Microsoft up to? That part of Mehdi's comments, at least, should prick up all our ears.
Now, apart from a half-decent mouse, keyboard and a next-generation G5 XBox Service Pack 2, Microsoft doesn't do hardware. Not very well, anyway. Cast your mind back to, oh, around 1984. Ready? Good. Apple's about to launch the Mac. Gates is about to launch Mac software. Oh, and something called 'Windows' as well.
Fast forward 20 years. Windows runs on around 90% of the world's PCs. The Mac OS share has shrunk to maybe 5%. Why? Because Microsoft licensed its Windows OS to run on generic x86 architecture. Apple didn't.
The same two men are in charge of the same two companies. Only Apple was the behemoth in 1984 and Microsoft was small fry. And Gates was only a multimillionaire.
One thing hasn't changed: Apple's OSes (yes, plural) remain closed. Well, so does Microsoft's, except that it runs on lots of hardware, although not PowerPC. Apart from the brief clone experiment of the mid-1990s, Apple's crown jewels remain close to its chest.
Which is something that persists with the iPod. Not that anyone seems to mind that you can only play iTunes tracks on iPods, since iTunes has become Windows/Mac platform-agnostic.
Returning to our original premise: the software MS is making for a slew of music player devices. Mehdi said that third-party manufacturers would make devices which would "look and feel" as good as iPod, but would be a little bit cheaper. MS's Portable Media Center software will run on those. Then there are the $50 flash-based players. Media Center will run on those too. Is a picture forming in your head?
Yes, Microsoft is hoping to repeat that three-card-trick of the 1980s/90s: i.e., "Pick a computer, any computer." And, whichever one you pick, you'll wind up with Microsoft. Even if you picked the Mac, you wound up with Microsoft. Office. Unless you live in a cave in the Tora Bora region, and even they were using SE/30s equipped with, if I'm not mistaken...Word.
So what's the strategy?
The Redmond strategy is scale. Standardize the software. Sign on licensees. Get the RIAA on board (after all, they need all the friends they can get). Ink contracts with the record companies promising Janus DRM and the widest deployment of players in the world. The industry buys this.
Suddenly, you have scale. Economies of scale, that is. So firms can offer players with more capacity, more features and a bigger music library than Apple can manage. For maybe $50-100 less than iPod. No, these players are unlikely to ever be as good as iPod. And the music services will never be as well-organized and presented and be as easy to use as the iTMS. But remember: Windows was 'good enough'. And Windows, iteration by iteration, became a passable facsimile of the Mac OS (yes, I just had a conversation with a 20-year-old who hates Macs, doesn’t know why, and seriously thought, until I disabused him, that Microsoft invented the GUI).
The only thing missing - which is why iPod is winning handsomely for now - is that there's nothing 'good enough' out there.
But there will be. Microsoft will provide it. We will shun it, scorn it, diss it.
But it will succeed. Ultimately.
Reader Comments
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Comments do not necessary reflect opinions of Insanely Great Mac
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Posted by Guest Poster #1 on 06/01/04 8:27 AM Reply to this Comment
it will succeed, yes, if making money is success
to me success in a product is class, which i happen to pay attention to and in doing so am surrounded by quality stuff, it's a choice anyone can make, but you have to care
if in the end apple has all the customers who care about quality, they will have won in my opinion
and i don't care for people who don't care... i'll just happily watch them buy whatever cheaper things they want, it will nicely contrast with my setup
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Posted by Guest Poster X on 06/01/04 8:34 AM Reply to this Comment
I am not convinced.
Other than desktop OSes and office software for them, Microsoft hasn't really be very successful with anything they touched. Well perhaps the mouse, yes, but think of all the failures that didn't get to dominate despite a huge marketing budget and despite using the desktop licensing approach.
So the question is this. Will the music player market follow the desktop market or will it rather follow the PDA and cell phone markets? You seem to think the former, I tend to think the latter.
- pessimism prevails
Posted by Gloom and doom on 06/01/04 8:39 AM Reply to this Comment
Your article appeals to my pessimistic side. I never underestimate Apple's ability to ignore market forces. I just hope that Jobs 'n company will open iTunes to other players when/if the iPod is finally overwhelmed.
Hardware sales is a good way to generate seed money, then it's lisencing. Apple might actually have a strong enough OSX market in x86-land to exceed hardward sales. Clearly there is much potential for G5/G6, etc., but at what cost is supporting expensive hardwre that ultimately keep you small? That may be Steve's utopian strategy. Clearly having a small user base on proprietary hardware makes the job of engineering products much more rewarding.
I think a better strategy is to use open source (or prevalent) technology as a base to customize and integrate only like Apple can. OSX is on top of open Darwin and it makes a strong case for this model. Sounds like the next power-based processors have a very open architecture. This is good for an open OSX, but potentially more bad news for a closed OSX that cannot run on the next insanely-great hardware platform not developed by Apple.
I think the iPod may ultimately suffer the same fate as the Macintosh, except with the iPod, an niche market will be more difficult to call a success. Now if we get our Home folder on iPod, the iPod will be another Newton that we will love as it dies an untimely death.
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Posted by Guest Poster #3 on 06/01/04 8:53 AM Reply to this Comment
Not that anyone seems to mind that you can only play iTunes tracks on iPods
What's that supposed to mean - did Apple buy the rights to the mp3 format or something? ipod plays mp3s as well as aac so it's hardly a closed format media player
- RE:
Posted by Mike on 06/01/04 9:01 AM
I think what the editor means is that you can only play iTunes Music Store tracks on an iPod since they are in an Apple proprietary AAC format. Of course, there are ways around this.
- RE:
Posted by Guest Poster X on 06/01/04 9:30 AM
AAC is not an Apple proprietary format folks. It is an international standard (part of MPEG-4) and was developed by Dolby.
Anybody can license AAC from Dolby and there are other companies who use it, not just Apple.
What is proprietary about the iTMS is the DRM, Fairplay which is Apple's own.
- This is news?
Posted by Mike on 06/01/04 8:57 AM Reply to this Comment
I think a lot of us saw this scenario coming as soon as Apple made the Windows version of iTunes only compatible with the iPod. October of 2003? Back then, an MS Exec commented that this exclusivity would eventually hurt iPod sales. If MS wants a market, they will take it even if it means losing money on the product they're trying to promote.
- RE: This is news?
Posted by Guest Poster #0 on 06/01/04 10:13 AM
Sure - is that why the xbox is selling so abysmally in Europe in spite of repeted specials and price cuts? Computer users may be used to inferior products like Windoze but you wouldn't want those in your entertainment or appliance section...
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Posted by Guest Poster #4 on 06/01/04 9:37 AM Reply to this Comment
Well, most people I know who use iPods don't actually use the iTMS, well most of them couldn't, even if they wanted to because I am not in the US and so most people I know are not in the US either. But anyway, I myself and most iPod owners I know, we have fairly large CD collections and we are gradually bringing them all into our iPods. I don't think this is uncommon. In other words, the fact that you cannot listen to songs bought from the iTMS on any other device doesn't really count as an argument against the iPod because the iPod has other ways it can be used.
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Posted by rah on 06/01/04 10:09 AM Reply to this Comment
Does iTMS make much difference to iPod sales? After all, it seems to sell just as well where iTMS isn't available.
- Almost switching
Posted by Guest Poster #4 on 06/01/04 10:11 AM Reply to this Comment
This doom and gloom article almost convinced me to switch except for three little points, namely
1) Wondows built it's original success on another widely used OS called DOS and spread by IBM and others widely before Windows was ever launched, giving it an instant-on major base. That's why they succeeded and other me-too's like BeOS didn't
2) For now Media Center software is so badly running from my own experience I wouldn't even want my electrical razor to run on it
3) The iPod is so cool that no other MP3 out right now or in preview comes even close.
Thus, be just and fear not - for the coming months the iPod may well save Apple's butt. And BTW the coalition MS is having with RIAA might disuade a lot of users from getting on board, especially in Europe - though this is a secondary market at beast, I'm sure. People over here - for now - are mostly outraged that the record companies have delayed the iTunes Europe store for so long... and once that's here it should bring some new wind to the iPods sails over here, even more so once the iPod mini becomes available in numbers...
- One point that shouldn't be overlooked ...
Posted by Guest Poster #4 on 06/01/04 10:44 AM Reply to this Comment
... is the role that corporate IT departments have played in Microsoft's success(?) story. The intertia which has kept Windows in the seat of power has become such an unstoppable force because of the weight of the corporate IT departments. The i-products face no such issue at this point in time and I have a hard time foreseeing a future where they would. The consumer marketplace is far different from the corporate marketplace and I think that more than anyone Steve Jobs unbderstands this.
Mike
- don't forget "IBM compatible" PCs were hundreds to thousands less
Posted by cesman on 06/01/04 10:55 AM Reply to this Comment
People forget how painfully expensive macs used to be (and don't forget that inflation makes $1000 in 1984 a lot more money than $1000 today). So yes, people were willing to go with "good enough" to save thousands, especially when your PC became outdated every 2-3 years and you really had to maximize your "hardware" dollar.
iPod/iTunes/iTMS is completely different. The iPod is $50 to $150 more, iTunes is free and the songs are the same price on every online store.
People aren't dumb. Everyone says the iPod is the best and easy to use. Go to a store, and anyone can tell the iPod looks a whole lot better, and functions really well and is easy to use. Most people are deciding to spend the little bit extra and go with Apple. After they do that and use iTunes and iTMS, there's no going back to Musicmatch, Windows Media Player or Napster.
- cheaper, cheaper, yay!
Posted by Guest Poster #4 on 06/01/04 1:08 PM Reply to this Comment
Well, as a consumer I really hope that this hardware market gets as commoditized as it can, so that premium becomes far cheaper that it is now and file format politics get somewhat diluted. The iPod is mostly good, but in no way is the ultimate implementation. I couldn't care less for online shopping, as even AAC at 128 Kb/s is no good enough.
Quit minimizing the ife revenue owd. It's $2.5 million in digeplayers and likely at least a half million to e.digital.
We know it pains you to realize that edig's platforms may be gaining traction but try to buck up will you? Your 2500 players and counting is the height of negative spin.
future platforms
PortalPlayer is committed to the development of products that support today's mobile lifestyle. With that in mind, the company sees the personal media player becoming the primary way for people to get, move and use their personal media collections everywhere.
The personal media player's small size will enable it to be easily enjoyed in the home, in the car, or on the go. It will easily link to a home audio/video receiver without the interoperability complications of complex home networks or digital media adapters. In fact, a simple docking cradle with AC power, video out and stereo audio out jacks will be the only technologies necessary to "sneaker net" the content throughout the home or take it along in the car or on vacation. Additionally, some models, like today's Rio Karma audio jukebox, will have built-in wired or wireless networking for those who want to share the content among different PCs in the household. A small onboard display will minimize cost, and users will be able to leverage TV and PC displays for viewing and control. Consumer infrared (IR) remotes will be supported for remote transport control.
Portable video will be driven by the availability of popular video content from download video service providers. Using the TV tuner and hardware encoder in a Microsoft® Windows® Media Center PC, for example, users will be able to record their favorite TV shows and transfer these to the Personal Media Player for viewing on the LCD display, or to a TV elsewhere in the home or on the road. The timing of mainstream portable video adoption will depend upon: sufficient availability of popular download content; installed base of Media Center PCs and their connection to a cable, satellite or antenna feed; support for a limited number of compression standards; and digital rights management (DRM) standards to enable sophisticated protection of the intellectual property rights of the owners.
As a result, PortalPlayer expects that consumers will ultimately carry two types of portable devices in their pockets -- personal media players that store all of their personal digital content; and communications devices that operate as mobile, cellular phones and personal digital assistants (PDAs) combined. The types of devices that comprise the personal media player segment will be diverse. PortalPlayer believes personal media players will feature CD-quality (lossless) and multichannel audio playback. In addition, they will have a broad range of photo and video capture, store and playback, and incorporate digital camcorder and digital still camera functionality.
Finally, portable media players will offer a broad range of wired and wireless functionality including: wireless headsets, wireless output to multiple display types, and networked functionality with other devices through a variety of standardized connectivity options. While the number and types of devices will proliferate, they will all be used as the primary storage and playback device for personal content, and will incorporate a small form factor high-capacity hard disk drive.
OT-The Rise Of India- portalplayer mention...
>
> Growth is only just starting, but the country's brainpower is already
> reshaping Corporate America
>
> As you pull into General Electric's (GE ) John F. Welch Technology
> Center, a uniformed guard waves you through an iron gate. Once inside,
> you leave the dusty, traffic-clogged streets of Bangalore and enter a
> leafy campus of low buildings that gleam in the sun. Bright hallways
> lined with plants and abstract art -- "it encourages creativity,"
> explains a manager -- lead through laboratories where physicists,
> chemists, metallurgists, and computer engineers huddle over gurgling
> beakers, electron microscopes, and spectrophotometers. Except for the
> female engineers wearing saris and the soothing Hindi pop music wafting
> through the open-air dining pavilion, this could be GE's giant
> research-and-development facility in the upstate New York town of Niskayuna
>
> It's more like Niskayuna than you might think. The center's 1,800
> engineers -- a quarter of them have PhDs -- are engaged in fundamental
> research for most of GE's 13 divisions. In one lab, they tweak the
> aerodynamic designs of turbine-engine blades. In another, they're
> scrutinizing the molecular structure of materials to be used in DVDs for
> short-term use in which the movie is automatically erased after a few
> days. In another, technicians have rigged up a working model of a GE
> plastics plant in Spain and devised a way to boost output there by 20%.
> Patents? Engineers here have filed for 95 in the U.S. since the center
> opened in 2000.
>
> Pretty impressive for a place that just four years ago was a fallow plot
> of land. Even more impressive, the Bangalore operation has become vital
> to the future of one of America's biggest, most profitable companies.
> "The game here really isn't about saving costs but to speed innovation
> and generate growth for the company," explains Bolivian-born Managing
> Director Guillermo Wille, one of the center's few non-Indians.
>
> The Welch center is at the vanguard of one of the biggest mind-melds in
> history. Plenty of Americans know of India's inexpensive software
> writers and have figured out that the nice clerk who booked their air
> ticket is in Delhi. But these are just superficial signs of India's
> capabilities. Quietly but with breathtaking speed, India and its
> millions of world-class engineering, business, and medical graduates are
> becoming enmeshed in America's New Economy in ways most of us barely
> imagine. "India has always had brilliant, educated people," says
> tech-trend forecaster Paul Saffo of the Institute for the Future in
> Menlo Park, Calif. "Now Indians are taking the lead in colonizing
> cyberspace."
>
> This techno take-off is wonderful for India -- but terrifying for many
> Americans. In fact, India's emergence is fast turning into the latest
> Rorschach test on globalization. Many see India's digital workers as
> bearers of new prosperity to a deserving nation and vital partners of
> Corporate America. Others see them as shock troops in the final assault
> on good-paying jobs. Howard Rubin, executive vice-president of Meta
> Group Inc., a Stamford (Conn.) information-technology consultant, notes
> that big U.S. companies are shedding 500 to 2,000 IT staffers at a time.
> "These people won't get reabsorbed into the workforce until they get the
> right skills," he says. Even Indian execs see the problem. "What
> happened in manufacturing is happening in services," says Azim H.
> Premji, chairman of IT supplier Wipro Ltd. "That raises a lot of social
> issues for the U.S."
>
> No wonder India is at the center of a brewing storm in America, where
> politicians are starting to view offshore outsourcing as the root of the
> jobless recovery in tech and services. An outcry in Indiana recently
> prompted the state to cancel a $15 million IT contract with India's Tata
> Consulting. The telecom workers' union is up in arms, and Congress is
> probing whether the security of financial and medical records is at
> risk. As hiring explodes in India, the jobless rate among U.S. software
> engineers has more than doubled, to 4.6%, in three years. The rate is
> 6.7% for electrical engineers and 7.7% for network administrators. In
> all, the Bureau of Labor Statistics reports that 234,000 IT
> professionals are unemployed.
>
> The biggest cause of job losses, of course, has been the U.S. economic
> downturn. Still, there's little denying that the offshore shift is a
> factor. By some estimates, there are more IT engineers in Bangalore
> (150,000) than in Silicon Valley (120,000). Meta figures at least
> one-third of new IT development work for big U.S. companies is done
> overseas, with India the biggest site. And India could start grabbing
> jobs from other sectors. A.T. Kearney Inc. predicts that 500,000
> financial-services jobs will go offshore by 2008. Indiana
> notwithstanding, U.S. governments are increasingly using India to manage
> everything from accounting to their food-stamp programs. Even the U.S.
> Postal Service is taking work there. Auto engineering and drug research
> could be next.
>
> More Science in Schools
> Tech luminary Andrew S. Grove, CEO of Intel Corp. (INTC ), warns that
> "it's a very valid question" to ask whether America could eventually
> lose its overwhelming dominance in IT, just as it did in electronics
> manufacturing. Plunging global telecom costs, lower engineering wages
> abroad, and new interactive-design software are driving revolutionary
> change, Grove said at a software conference in October. "From a
> technical and productivity standpoint, the engineer sitting 6,000 miles
> away might as well be in the next cubicle and on the local area
> network." To maintain America's edge, he said, Washington and U.S.
> industry must double software productivity through more R&D investment
> and science education.
>
> But there's also a far more positive view -- that harnessing Indian
> brainpower will greatly boost American tech and services leadership by
> filling a big projected shortfall in skilled labor as baby boomers
> retire. That's especially possible with smarter U.S. policy. Companies
> from GE Medical Systems (GE ) to Cummins (CUM ) to Microsoft (MSFT ) to
> enterprise-software firm PeopleSoft (PSFT ) that are hiring in India say
> they aren't laying off any U.S. engineers. Instead, by augmenting their
> U.S. R&D teams with the 260,000 engineers pumped out by Indian schools
> each year, they can afford to throw many more brains at a task and speed
> up product launches, develop more prototypes, and upgrade quality. A top
> electrical or chemical engineering grad from Indian Institutes of
> Technology (IITS) earns about $10,000 a year -- roughly one-eighth of
> U.S. starting pay. Says Rajat Gupta, an IIT-Delhi grad and senior
> partner at consulting firm McKinsey & Co.: "Offshoring work will spur
> innovation, job creation, and dramatic increases in productivity that
> will be passed on to the consumer."
>
> Whether you regard the trend as disruptive or benefical, one thing is
> clear. Corporate America no longer feels it can afford to ignore India.
> "There's just no place left to squeeze" costs in the U.S., says Chris
> Disher, a Booz Allen Hamilton Inc. outsourcing specialist. "That's why
> every CEO is looking at India, and every board is asking about it."
> neoIT, a consultant advising U.S. clients on how to set up shop in
> India, says it has been deluged by big companies that have been slow to
> move offshore. "It is getting to a state where companies are literally
> desperate," says Bangalore-based neoIT managing partner Avinash Vashistha.
>
> As a result of this shift, few aspects of U.S. business remain
> untouched. The hidden hands of skilled Indians are present in the
> interactive Web sites of companies such as Lehman Brothers (LEH ) and
> Boeing (BA ), display ads in your Yellow Pages, and the electronic
> circuitry powering your Apple Computer (AAPL ) iPod. While Wall Street
> sleeps, Indian analysts digest the latest financial disclosures of U.S.
> companies and file reports in time for the next trading day. Indian
> staff troll the private medical and financial records of U.S. consumers
> to help determine if they are good risks for insurance policies,
> mortgages, or credit cards from American Express Co. (AXP ) and J.P.
> Morgan Chase & Co. (JPM ).
>
> By 2008, forecasts McKinsey, IT services and back-office work in India
> will swell fivefold, to a $57 billion annual export industry employing 4
> million people and accounting for 7% of India's gross domestic product.
> That growth is inspiring more of the best and brightest to stay home
> rather than migrate. "We work in world-class companies, we're growing,
> and it's exciting," says Anandraj Sengupta, 24, an IIT grad and young
> star at GE's Welch Centre, where he has filed for two patents. "The
> opportunities exist here in India."
>
> If India can turn into a fast-growth economy, it will be the first
> developing nation that used its brainpower, not natural resources or the
> raw muscle of factory labor, as the catalyst. And this huge country
> desperately needs China-style growth. For all its R&D labs, India
> remains visibly Third World. IT service exports employ less than 1% of
> the workforce. Per-capita income is just $460, and 300 million Indians
> subsist on $1 a day or less. Lethargic courts can take 20 years to
> resolve contract disputes. And what pass for highways in Bombay are
> choked, crumbling roads lined with slums, garbage heaps, and homeless
> migrants sleeping on bare pavement. More than a third of India's 1
> billion citizens are illiterate, and just 60% of homes have electricity.
> Most bureaucracies are bloated, corrupt, and dysfunctional. The
> government's 10% budget deficit is alarming. Tensions between Hindus and
> Muslims always seem poised to explode, and the risk of war with
> nuclear-armed Pakistan is ever-present.
>
> So it's little wonder that, compared to China with its modern
> infrastructure and disciplined workforce, India is far behind in exports
> and as a magnet for foreign investment. While China began reforming in
> 1979, India only started to emerge from self-imposed economic isolation
> after a harrowing financial crisis in 1991. China has seen annual growth
> often exceeding 10%, far better than India's decade-long average of 6%.
>
> In the Valley's Marrow
> Still, this deep source of low-cost, high-IQ, English-speaking
> brainpower may soon have a more far-reaching impact on the U.S. than
> China. Manufacturing -- China's strength -- accounts for just 14% of
> U.S. output and 11% of jobs. India's forte is services -- which make up
> 60% of the U.S. economy and employ two-thirds of its workers. And Indian
> knowledge workers are making their way up the New Economy food chain,
> mastering tasks requiring analysis, marketing acumen, and creativity.
>
> This means India is penetrating America's economic core. The 900
> engineers at Texas Instruments Inc.'s (TXN ) Bangalore chip-design
> operation boast 225 patents. Intel Inc.'s (INTC ) Bangalore campus is
> leading worldwide research for the company's 32-bit microprocessors for
> servers and wireless chips. "These are corporate crown jewels," says
> Intel India President Ketan Sampat. India is even getting hard-wired
> into Silicon Valley. Venture capitalists say anywhere from one-third to
> three-quarters of the software, chip, and e-commerce startups they now
> back have Indian R&D teams from the get-go. "We can barely imagine
> investing in a company without at least asking what their plans are for
> India," says Sequoia Capital partner Michael Moritz, who nurtured
> Google, Flextronics (FLEX ), and Agile Software (AGIL ). "India has
> seeped into the marrow of the Valley."
>
> It's seeping into the marrow of Main Street. This year, the tax returns
> of some 20,000 Americans were prepared by $500-a-month CPAs such as
> Sandhya Iyer, 24, in the Bombay office of Bangalore's MphasiS. After
> reading scanned seed and fertilizer invoices, soybean sales receipts, W2
> forms, and investment records from a farmer in Kansas, Iyer fills in the
> farmer's 82-page return. "He needs to amortize these," she types next to
> an entry for new machinery and a barn. A U.S. CPA reviews and signs the
> finished return. Next year, up to 200,000 U.S. returns will be done in
> India, says CCH Inc. in Riverwoods, Ill., a supplier of accounting
> software. And it's not only Big Four firms that are outsourcing. "We are
> seeing lots of firms with 30 to 200 CPAs -- even single practitioners,"
> says CCH Sales Vice-President Mike Sabbatis.
>
> The gains in efficiency could be tremendous. Indeed, India is
> accelerating a sweeping reengineering of Corporate America. Companies
> are shifting bill payment, human resources, and other functions to new,
> paperless centers in India. To be sure, many corporations have run into
> myriad headaches, ranging from poor communications to inconsistent
> quality. Dell Inc. recently said it is moving computer support for
> corporate clients back to the U.S. Still, a raft of studies by Deloitte
> Research, Gartner, Booz Allen, and other consultants find that companies
> shifting work to India have cut costs by 40% to 60%. Companies can offer
> customer support and use pricey computer gear 24/7. U.S. banks can
> process mortgage applications in three hours rather than three days.
> Predicts Nandan M. Nilekani, managing director of Bangalore-based
> Infosys Technologies Ltd. (INFY ): "Just like China drove down costs in
> manufacturing and Wal-Mart (WMT ) in retail," he says, "India will drive
> down costs in services."
>
> But deflation will also mean plenty of short-term pain for U.S.
> companies and workers who never imagined they'd face foreign rivals.
> Consider America's $240 billion IT-services industry. Indian players led
> by Infosys, Tata, and Wipro got their big breaks during the Y2K scare,
> when U.S. outfits needed all the software help they could get. Indians
> still have less than 3% of the market. But by undercutting giants such
> as Accenture, IBM, and Electronic Data Systems (EDS ) by a third or more
> for software and consulting, they've altered the industry's pricing.
> "The Indian labor card is unbeatable," says Chief Technology Officer
> John Parkinson of consultant Cap Gemini Ernst & Young. "We don't know
> how to use technology to make up the difference."
>
> Wrenching Change
> Many U.S. white-collar workers are also in for wrenching change. A study
> by McKinsey Global Institute, which believes offshore outsourcing is
> good, also notes that only 36% of Americans displaced in the previous
> two decades found jobs at the same or higher pay. The incomes of a
> quarter of them dropped 30% or more. Given the higher demands of
> employers, who want technicians adept at innovation and management, it
> could take years before today's IT workers land solidly on their feet.
>
> India's IT workers, in contrast, sense an enormous opportunity. The
> country has long possessed some basics of a strong market-driven
> economy: private corporations, democratic government, Western accounting
> standards, an active stock market, widespread English use, and schools
> strong in computer science and math. But its bureaucracy suffocated
> industry with onerous controls and taxes, and the best scientific and
> business minds went to the U.S., where the 1.8 million Indian
> expatriates rank among the most successful immigrant groups.
>
> Now, many talented Indians feel a sense of optimism India hasn't
> experienced in decades. "IT is driving India's boom, and we in the
> younger generation can really deliver the country from poverty," says
> Rhythm Tyagi, 22, a master's degree student at the new Indian Institute
> of Information Technology in Bangalore. The campus is completely wired
> for Wi-Fi and boasts classrooms with videoconferencing to beam sessions
> to 300 other colleges.
>
> That confidence is finally spurring the government to tackle many of the
> problems that have plagued India for so long. Since 2001, Delhi has been
> furiously building a network of high- ways. Modern airports are next.
> Deregulation of the power sector should lead to new capacity. Free
> education for girls to age 14 is a national priority. "One by one, the
> government is solving the bottlenecks," says Deepak Parekh, a financier
> who heads the quasi-governmental Infrastructure Development Finance Co.
>
> Future Vision
> India also is working to assure that it will be able to meet future
> demand for knowledge workers at home and abroad. India produces 3.1
> million college graduates a year, but that's expected to double by 2010.
> The number of engineering colleges is slated to grow 50%, to nearly
> 1,600, in four years. Of course, not all are good enough to produce the
> world-class grads of elite schools like the IITs, which accepted just
> 3,500 of 178,000 applicants last year. So there's a growing movement to
> boost faculty salaries and reach more students nationwide through
> broadcasts. India's rich diaspora population is chipping in, too.
> Prominent Indian Americans helped found the new Indian School of
> Business, a tie-up with Wharton School and Northwestern University's
> Kellogg Graduate School of Management that lured most of its faculty
> from the U.S. Meanwhile, the six IIT campuses are tapping alumni for
> donations and research links with Stanford, Purdue, and other top
> science universities. "Our mission is to become one of the leading
> science institutions in the world," says director Ashok Mishra of
> IIT-Bombay, which has raised $16 million from alumni in the past five years.
>
> If India manages growth well, its huge population could prove an asset.
> By 2020, 47% of Indians will be between 15 and 59, compared with 35%
> now. The working-age populations of the U.S. and China are projected to
> shrink. So India is destined to have the world's largest population of
> workers and consumers. That's a big reason why Goldman, Sachs & Co. (GS
> ) thinks India will be able to sustain 7.5% annual growth after 2005.
>
> Skeptics fear U.S. companies are going too far, too fast in linking up
> with this giant. But having watched the success of the likes of GE
> Capital International Services (GE ), many execs feel they have no
> choice. Inside GECIS' Bangalore center -- one of four in India -- Gauri
> Puri, a 28-year-old dentist, is studying an insurance claim for a
> root-canal operation to see if it's covered in a certain U.S. patient's
> dental plan. Two floors above, members of a 550-strong analytics team
> are immersed in spreadsheets filled with a boggling array of data as
> they devise statistical models to help GE sales staff understand the
> needs, strengths, and weaknesses of customers and rivals. Other staff
> prepare data for GE annual reports, write enterprise resource-planning
> software, and process $35 billion worth of global invoices. Says GE
> Capital India President Pramod Bhasin: "We are mission-critical to GE."
> The 700 business processes done in India save the company $340 million a
> year, he says.
>
> Indian finance whizzes are a godsend to Wall Street, too, where
> brokerages are under pressure to produce more independent research. Many
> are turning to outfits such as OfficeTiger in the southern city of
> Madras. The company employs 1,200 people who write research reports and
> do financial analysis for eight Wall Street firms. Morgan Stanley (MWD
> ), J.P. Morgan (JPM ), Goldman Sachs (GS ), and other big investment
> banks are hiring their own armies of analysts and back-office staff.
> Many are piling into Mindspace, a sparkling new 140-acre
> city-within-a-city abutting Bombay's urban squalor. Some 3 million
> square feet are already leased to Western finance firms. By yearend,
> Morgan Stanley will fill several floors of a new building.
>
> For Silicon Valley startups, Indian engineers let them stretch R&D
> budgets. PortalPlayer Inc., a Santa Clara (Calif.) maker of multimedia
> chips and embedded software for portable devices such as music players,
> has hired 100 engineers in India and the U.S. who update each other
> daily at 9 a.m. and 10 p.m. J.A. Chowdary, CEO of PortalPlayer's
> Hyderabad subsidiary Pinexe, says the company has shaved up to six
> months off the development cycle -- and cut R&D costs by 40%. Impressed,
> venture capitalists have pumped $82 million into PortalPlayer.
>
> More Bang for the Buck
> Old economy companies are benefiting, too. Engine maker Cummins plans to
> use its new R&D center in Pune to develop the sophisticated computer
> models needed to design upgrades and prototypes electronically. Says
> International Vice-President Steven M. Chapman: "We'll be able to
> introduce five or six new engines a year instead of two" on the same
> $250 million R&D budget -- without a single U.S. layoff.
>
> The nagging fear in the U.S., though, is that such assurances will ring
> hollow over time. In other industries, the shift of low-cost production
> work to East Asia was followed by engineering. Now, South Korea and
> Taiwan are global leaders in notebook PCs, wireless phones, memory
> chips, and digital displays. As companies rely more on IT engineers in
> India and elsewhere, the argument goes, the U.S. could cede control of
> other core technologies. "If we continue to offshore high-skilled
> professional jobs, the U.S. risks surrendering its leading role in
> innovation," warns John W. Steadman, incoming U.S. president of
> Institute of Electrical & Electronics Engineers Inc. That could also
> happen if many foreigners -- who account for 60% of U.S. science grads
> and who have been key to U.S. tech success -- no longer go to America to
> launch their best ideas.
>
> Throughout U.S. history, workers have been pushed off farms, textile
> mills, and steel plants. In the end, the workforce has managed to move
> up to better-paying, higher-quality jobs. That could well happen again.
> There will still be a crying need for U.S. engineers, for example. But
> what's called for are engineers who can work closely with customers,
> manage research teams, and creatively improve business processes.
> Displaced technicians who lack such skills will need retraining; those
> entering school will need broader educations.
>
> Adapting to the India effect will be traumatic, but there's no sign
> Corporate America is turning back. Yet the India challenge also presents
> an enormous opportunity for the U.S. If America can handle the
> transition right, the end result could be a brain gain that accelerates
> productivity and innovation. India and the U.S., nations that barely
> interacted 15 years ago, could turn out to be the ideal economic
> partners for the new century.
>
>
> By Manjeet Kripalani and Pete Engardio
> With Steve Hamm in New York
Gateway Delays Planned Analyst Meeting
May 28, 2004 — By Duncan Martell
SAN FRANCISCO (Reuters) - Consumer electronics and personal computer maker Gateway Inc. <GTW.N> has delayed its June analyst meeting until September, citing the need to finalize its new strategy, the company said on Friday.
Gateway initially informed investors of the delay in an e-mail sent on Thursday and said it would move the meeting to New York from Irvine, California, which is near its Poway, California, headquarters.
The company said that by postponing the planned meeting from June 17 it would be able to provide more details about its distribution plans and cost reductions, among other matters.
Gateway earlier this year bought the profitable, privately held eMachines for $290 million in a bid to expand its presence in low-cost PCs, where eMachines has been strong, and to sell its products through major electronics retailers.
Bear Stearns analyst Andy Neff, who rates the stock a "peer perform," said he viewed the delay in the analyst meeting as a possible negative because investors have been anxious for details on Gateway's turnaround.
"It could be a sign that Gateway's negotiations with retailers to reintroduce the Gateway brand on retail store shelves is taking longer than planned," Neff wrote in a note to clients.
Gateway spokesman Ted Ladd said that the meeting's delay was a result of shifting the venue to New York and intended "to make sure we would be able to deliver the full story to analysts."
"We are in discussions with most of the big-box retailers and talks have been promising so far," Ladd said.
He said Gateway would be in its "quiet period" for much of July ahead of the release of second-quarter earnings, and noted that many analysts are on vacation in August, making September the most logical choice. A precise date has not been set.
Ladd declined further comment on the company's integration of the eMachines acquisition and turnaround plans.
Gateway has tried a number of strategies since it fell on hard times in 2001 as it sought to turn a profit amid stiff competition from Dell Inc. <DELL.O> and Hewlett-Packard Co. <HPQ.N>
As part of Gateway's acquisition of eMachines, that company's chief executive, Wayne Inouye, became CEO of Gateway, replacing co-founder Ted Waitt, who remains chairman.
Since then it has announced thousands of layoffs and closed its remaining 188 Gateway retail stores. Gateway still plans to end the year with 2,000 employees, down from its current level of about 3,500, Ladd said.
At Gateway's annual meeting earlier this month, Inouye said a central tenet of the company's plan to boost revenue is expanding its presence in retail stores such as Best Buy, where Inouye once worked.
Gateway also plans to position Gateway-branded PCs as premium products sold through its Web site, over the phone, through retailers and to professionals. The eMachines brand will remain as a lower-cost PC aimed at retail outlets.
Waitt's latest plan for Gateway was to turn it into what he calls a "branded integrator," selling a wide range of digital devices beyond PCs, including media center PCs, digital cameras, handheld computers and wireless home networking equipment.
Gateway shares fell 2 cents to $3.96 on Friday on the New York Stock Exchange. The stock has fallen 14 percent this year, compared with an 8 percent decline in shares of Hewlett-Packard Co.<HPQ.N> and a 3.5 percent rise in Dell Inc. <DELL.O> stock.
(Additional reporting by Caroline Humer in New York)
The Way the Music Died
Posted by michael on Friday May 28, @10:06AM
from the drove-my-chevy-to-the-levy-but-the-levy-was-dry dept.
segfaultcoredump writes "Frontline just released a show entitled The Way the Music Died, an in-depth look at all that is wrong with the music industry. The show will be available for online viewing on May 29th. Their website includes the full text of all of the interviews done during the show, including a very interesting one with musical legend David Crosby, where he hits the reason the industry is having problems right on the head." Reader robl adds "This is a good sequel to the 2001 Frontline episode, The Merchants of Cool which showed how the music industry markets its wares to teenagers and how it hypes artists."
http://www.pbs.org/wgbh/pages/frontline/shows/music/
Well, surely the digeplayer sales bode poorly for us and will probably lead us to ruin..Alaska, Hawaiian, KLM, Jetsgo. I sure hope we don't see our pPVR platform produced by several OEMs..Fusion, TGE...that could really be the death of us.
How's that owd..is that more to your liking?
So you read the filings like everyone else..big deal. Your posts imply that you know much more but obviously they are just hot air.
F-T thought so little of EDIG's efforts they decline to pay them for it
Was that in the filing or is that just more of your libelous drivel?
Now speculation would be that GW did it because of the poor quality, or the high return rate, or the high warranty cost, but it probably a safe bet to say they didn't drop it because they were making too much money on it, wouldn't ya say? But we do know GW is no longer selling the EDIG project.
Well I don't know. The companies are undergoing a major reorganization. Why don't you ask them? Why did they drop so many other players as well..Do you think you could speculate on that too!!
Microsoft to undercut iPod price with player
Microsoft Corp., the world's largest software maker, will begin selling portable music players for as much as 80 percent less than Apple Computer Inc.'s iPod.
The Microsoft-branded devices will "look and feel" as good as the iPod for as little as $50, said Yusuf Mehdi, corporate vice president of MSN at Microsoft Corp., at the Goldman Sachs fifth annual Internet Conference in Las Vegas. The iPod sells for $249 to $499.
Microsoft, based in Redmond, Wash., will release a number of music players when it launches its online music service later this year, giving customers more choices than Apple, Mehdi said.
CHICAGO
talk about rinse,lather,and repeat. You know squat about Gateway, Portalplayer, fujitsu-Ten, etc. but you're chock full of negative speculation. Ya see owd, that's why no one here can tolerate your rants. Dataplay blew up so we didn't get any DataPlay revenue...duhhh!! F10 is not honoring a signed contract...I know our fault (maybe..we'll see). Gateway can't right itself and swallows emachines, discontinues all MP3 players...yes clearly all these events were either caused by e.Digital or should undoubtedly have been foreseen by management...
and you wonder why we don't see things your way...
obviously APS selling millions of dollars worth of digeplayers is part of a grand conspiracy to give us the illusion of future profits. I'm sure we did all the work on the units and licensed the platform for free and we will maintain and refurbish them for free as well.
Once more, your attempts to explain everything away are purely one-sided and fall short of the mark.
e.Digital expects to realize several million dollars in revenue through APS' digEplayer product sales to airlines and other companies serving the travel and leisure industry, as well as refurbishment fees and other services provided to APS.
Oh,and emit I believe it was around $200.00 per player.
Oh, and owd, we haven't heard the result of the F10 arbitration yet have we??
milplease, that's the way I read it!Nice find.eom
US Broadband Penetration Jumps to 47.9%
.
The Bandwidth Report from Andy King is a monthly roundup of connectivity trends in the US and elsewhere. Each month's bandwidth report offers the latest statistics in Internet connectivity and broadband trends
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US broadband penetration grew by 1.9 points in April, with 47.87% of active Internet users enjoying a high-speed connection at home. This jump of nearly 2 points is 2.5 times the average rate of broadband growth. 52.13% of US home users dial into the Internet with "narrowband" connections of 56Kbps or less.*
Meanwhile, broadband growth in other countries suggests a limit of 75% saturation. The charts below, derived from Nielsen//NetRatings data, show trends in connection speeds to the Internet for users in the United States.
Home Connectivity in the US:
As of April 2004, most users in the US connect to the Internet using dial-up modems of 56Kbps or less. 42.74% use 56Kbps modems, 6.99% use 28/33.3Kbps, and 2.4% use 14.4Kbps modems. In total. 52.13% of home users in the US connect to the Internet at 56Kbps or less (see Figure 1).
http://www.websiteoptimization.com/bw/0405/
Broadband Growth in the US:
Broadband penetration in the US increased by 1.9 points in April. As of April 2004 broadband penetration was at 47.87%, up from 45.97% in March. This jump of 1.9 points is 2.5 times higher than the average increase in broadband of 0.76 points per month from October 1999 to February 2004. Extrapolating the data provided by Nielsen//NetRatings, broadband share in the US should exceed 50% by July of 2004 (see Figure 2). http://www.websiteoptimization.com/bw/0405/
Work Connectivity:
Most workers in the US enjoy high-speed connections to the Internet. Most use a high-speed line such as a T1 connection, and share bandwidth between computers connected to an Ethernet network. The speed of each connection decreases as more employees hook up to the LAN. As of April of 2004, of those connected to the Internet, 79% of US users at work enjoy a high-speed connection, up from 78.8% in March. 21% connect from work at 56Kbps or less (see Figure 3).
http://www.websiteoptimization.com/bw/0405/
Broadband Saturation Limit?
Is there a broadband saturation limit? Canadian broadband and Korean broadband data suggest at least a short term broadband saturation limit of 70% to 75%. We asked Marc Canter, CEO of Broadband Mechanics about a broadband saturation limit.
"Everything we have right now is simply mid-band. The world will be in constant transition as dial-up (unfortunately) won't go away. YES there is saturation at 75% - but until there are enough compelling apps and services that REQUIRE broadband - we're stuck with that reality."
We asked Chris Ferneyhough, Vice President of Ipsos-Reid, why he thought Canadian broadband penetration growth is tapering off.
"I think it is tapering off because there is a sizable segment of the population that will always be content with dial-up. They don't spend a lot of time online, and realistically the majority of the time they do spend online is just to check email. Additionally, people who live in rural areas simply don't have access to high speed. My guess is that the limit will likely be around 75%."
We asked Bruce Leichtman, President of Leichtman Research Group, why broadband adoption is slowing in Canada and other countries.
"The broadband decision comes down to a price/value equation – every day consumers (in many countries) are making the decision if the added benefits of broadband are worth the price. Eventually you come to a point where fewer people make the decision that it is worth the price. Even if the price is the same as dial-up there will always be a group of people who are comfortable with what they have and don't want to change."
Kenneth Cassar, Director of Strategic Analysis at Nielsen//NetRatings said this about the growth of broadband.
"The broadband market has gone from immature (1997 to 2000) to adolescence (2001-2005 or 2006) to mature (2006). We will enter maturity at around 66%-70% penetration when the growth will slow from 10+ points a year to single digit growth, due to a variety of factors."
Some of the factors that affect the growth of broadband are:
* Price - broadband costs more than dial-up.
* Infrastructure - cable and phone companies have not built out their infrastructure to remote and rural areas yet. They require a certain density of population to justify building out their infrastructure. Once economies of scale kick in and consumer demand increases you'll get better uptake of broadband in these remote areas.
* Peer pressure - you send large files to others. "Why don't you upgrade?"
Further Reading:
FCC: Local Telephone Competition and Broadband Deployment Broadband penetration data by state from the FCC.
http://www.fcc.gov/wcb/iatd/comp.html
Ipsos-Reid
Supplies the Canadian broadband penetration data for the Bandwidth Report.
http://www.ipsos-reid.com/
Nielsen//NetRatings
Provides the US broadband data for the Bandwidth Report.
http://www.netratings.com/
PEW Internet and American Life Reports
Research, surveys, and analysis of Internet activity in America from PEW. Includes wireless penetration, broadband adoption, and Internet usage.
http://www.pewinternet.org/reports/index.asp
* Note that Nielsen//NetRatings reports the percentage of active Internet users that use broadband from home, not broadband households. NetRatings uses a panel of 40,000 to 50,000 people with software meters installed on their computers. These meters detect connection speeds. Each month they do an enumeration study to call a number of people to calibrate the panel by adjusting weightings to match the population at large.
About The Bandwidth Report:
The Bandwidth Report is a monthly roundup of connectivity trends in the US and elsewhere. Each month's bandwidth report offers the latest statistics in Internet connectivity and broadband trends,
including:
* Home Connectivity in the US
* Broadband Growth in the US
* Work Connectivity
* Broadband Trends in the US, Canada, and other countries
The May 2004 Bandwidth Report is available at:
http://www.websiteoptimization.com/bw/0405/
'Pirate Act' raises civil rights concerns
Last modified: May 26, 2004, 4:00 AM PDT
By Declan McCullagh
Staff Writer, CNET News.com
File swappers concerned about getting in trouble with record labels over illegal downloads may soon have a major new worry: the U.S. Department of Justice.
A proposal that the Senate may vote on as early as next week would let federal prosecutors file civil lawsuits against suspected copyright infringers, with fines reaching tens or even hundreds of thousands of dollars.
The so-called Pirate Act is raising alarms among copyright lawyers and lobbyists for peer-to-peer firms, who have been eyeing the recording industry's lawsuits against thousands of peer-to-peer users with trepidation. The Justice Department, they say, could be far more ambitious.
News.context
What's new:
A proposal that the full Senate could vote on as early as next week would let federal prosecutors file civil lawsuits against suspected copyright infringers.
Bottom line:
Copyright lawyers and lobbyists for peer-to-peer companies, who have been eyeing the recording industry's lawsuits against peer-to-peer users with trepidation, warn that the Justice Department could be far more ambitious.
More stories on this topic
One influential proponent of the Pirate Act is urging precisely that. "Tens of thousands of continuing civil enforcement actions might be needed to generate the necessary deterrence," Sen. Orrin Hatch, R-Utah, said when announcing his support for the bill. "I doubt that any nongovernmental organization has the resources or moral authority to pursue such a campaign."
The Pirate Act represents the latest legislative priority for the Recording Industry Association of America (RIAA) and its allies, who collectively argue that dramatic action is necessary to prevent file-swapping networks from continuing to blossom in popularity.
"We view this as a key component of an enforcement package," RIAA lobbyist Mitch Glazier said Tuesday. "If you're going to try to make sure that you have effective deterrence, then one of the tools you'll need is to make sure that prosecutors have flexibility."
Foes of the Pirate Act have been alarmed by the unusual alacrity of the proposal's legislative progress. It was introduced just two months ago, on March 25, and not one hearing was held before the Judiciary committee forwarded it to the full Senate for a vote a month later.
"This was an attempt to move it in a stealthy manner," said Philip Corwin, a lobbyist for Sharman Networks, which operates the Kazaa network. "I can't imagine that (Hollywood lobbyist) Jack Valenti or (RIAA chairman) Mitch Bainwol really wants to come before Congress and give testimony saying, 'We can't afford to bring these lawsuits. That's why we want the taxpayer to pay for them.' I can't believe they want to do that in public."
Potential P2P prosecutions
Underlying the public jockeying over the Pirate Act is a classic political war of wills between the federal government's legislative and executive branches.
Under a 1997 law called the No Electronic Theft Act, federal prosecutors can file criminal charges against peer-to-peer users who make a large number of songs available for download. A July 2002 letter from prominent congressmen to U.S. Attorney General John Ashcroft urged the prosecution of Americans who "allow mass copying from their computer over peer-to-peer networks."
But not one peer-to-peer criminal prosecution has taken place in the United States. The Justice Department has indicated that it won't target peer-to-peer networks for two reasons: Imprisoning file-swapping teens on felony charges isn't the department's top priority, and it's always difficult to make criminal charges stick.
The Pirate Act was crafted to respond to the Justice Department's concern. "Federal prosecutors have been hindered in their pursuit of pirates by the fact that they were limited to bringing criminal charges with high burdens of proof," Sen. Patrick Leahy, D-Vt., said in March. "Prosecutors can rarely justify bringing criminal charges, and copyright owners have been left alone to fend for themselves, defending their rights only where they can afford to do so. In a world in which a computer and an Internet connection are all the tools you need to engage in massive piracy, this is an intolerable predicament."
The RIAA's Glazier said: "The idea was to give prosecutors the flexibility to decide whether to bring a civil case against somebody. Giving them a criminal fine with a criminal record was viewed as a fairly harsh penalty for the activity...You're still committing a crime. But (prosecutors) are given a flexible remedy so there's some proportionality."
For copyright holders, there's an additional bonus. Unlike when the RIAA files its own lawsuits against peer-to-peer users, such as the 493 defendants it announced this week, the Justice Department likely would be able to seek wiretaps to collect evidence about P2P infringement. Current wiretap law says electronic communications may be intercepted when a potential federal felony is being investigated.
"Corporate copyright welfare"
In addition, the Pirate Act gives Ashcroft six months to "develop a program to ensure effective implementation and use of the authority for civil enforcement of the copyright laws" and report back to Congress on how many civil lawsuits have been filed. The Justice Department would receive an extra $2 million for the fiscal year beginning in October.
"It represents yet another point in another very long line of major corporate copyright interests pushing for and receiving what amounts to significant corporate welfare," said Adam Eisgrau, a lobbyist for the P2P United trade association. "This legislation literally offloads the cost of enforcing copyrights traditionally borne by the copyright holder onto the federal government and therefore the taxpayers."
Last week, the Pirate Act had been considered for a floor vote under a process normally restricted for noncontroversial measures. But the vote didn't happen, which one foe of the bill attributed to opposition from Sen. Norm Coleman, a Republican from Minnesota.
Coleman has slammed the RIAA in the past for going too far in its fierce legal campaign against individual file swappers. A representative was unable to confirm Tuesday whether Coleman had placed a "hold" on the bill.
Critics also charge that the Pirate Act may invent a form of double jeopardy: It would let the RIAA sue the same people already sued by the Justice Department.
"The kinds of things we have a double-jeopardy doctrine to prevent seem to be implicated by the bill," said Jessica Litman, author of "Digital Copyright" and a law professor at Wayne State University. "I find it disturbing that the committee reported this out without at least having a hearing to consider some of the alternatives."
The RIAA points out that the bill does limit damages it can collect in a subsequent lawsuit, but opponents of the proposal said they weren't convinced.
"Why should someone be sued by the government and then be subject to a second lawsuit brought by a private party?" said Corwin, the Sharman Networks lobbyist. "The RIAA is settling most of these lawsuits. What's the Justice Department's policy going to be?"
OT TiVo shares jump on subscriber growth optimism
By Franklin Paul, Reuters / May 26, 2004
NEW YORK (Reuters) - Shares of TiVo Inc. jumped more than 20 percent Wednesday on optimism about the television recording technology company's growth strategy, despite its widening losses and dependence on DirecTV for new subscribers.
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TiVo shares rose to an early high of $9.12 on Nasdaq, recouping most of the losses sustained over the past 6 weeks.
The rise comes after TiVo, whose name has become synonymous with digital video recorders (DVR), late on Tuesday posted a wider fiscal first quarter loss, on better-than-expected revenue, but said subscribers tripled in the period and would do so again in the current quarter.
TiVo chief executive Michael Ramsay reiterated the San Jose, California, company's outlook that it will top 10 million subscribers in three or four years, from nearly 1.6 million at the end of the quarter.
TiVo shares had been under pressure recently amid concerns that it had bet too much of its future on DirecTV, its biggest supplier of new subscribers. While DirecTV and TiVo enjoy a strong relationship today, DirecTV's new corporate parent, Rupert Murdoch's News Corp. Ltd., may bring in a rival DVR provider.
With that in mind, TiVo has accelerated marketing spending in hopes of growing subscribers and drawing attention to its other services, including home media networking and special advertising on its systems.
"TiVo is a compelling story for growth-oriented investors and is well positioned to capitalize on mass market adoption of DVR services and accelerated earnings growth in fiscal year 2006 and beyond," said WR Hambrecht & Co. analyst Ryan Hutchinson, in a note to clients.
However, some analysts suggested the results show that TiVo is precariously dependent on DirecTV. TiVo added 264,000 new subscribers in the quarter, well ahead of analyst expectations, but some 74 percent of them came from DirecTV.
"Given management's second-quarter guidance of only 65,000 to 75,000 stand-alone subscriber additions, we continue to be concerned that the public's desire to own a stand-alone unit may be somewhat muted," said Sanders Morris Harris analyst David Miller.
TiVo shares rose 37 cents to $7.94, in late morning trade, on volume of 25.6 million, sharply up from its daily average of about 2 million.
Man, the naysayers are coming out of the woodwork! Quick, somebody turn on a light!
And DataPlay..that was our fault??LOL, you guys are killing me, ya really are...
owd3, anyone else have portable IFE on ANY airline big or small? No, didn't think so...
Anyone supplanting the Disney headsets (which I saw a number of when I was there six months ago..shortly after their introduction)?? No, didn't think so...
So let me see if I've got you right...anything e.Digital does will never be successful, if it is successful someone else will copy/improve on it, and finally edig gives away all its efforts in the name of charity and will never see any profit because...well..because you said so.
Wow, that is a compelling argument!
Yeah, tech looks like some of that spaghetti on the wall is starting to stick eh??
Cassfredrock, all your gloom and doom will not change the fact that the company continues to produce designs that capture the interest of oems around the world. If just the digeplayers have good success, this company will be back on its feet. If the ppvr and other products take hold, things will be looking good in short order.
Your constant innuendo about this deal and that deal (i.e. F10 arbitration)are obvious distortions and pure speculation on your part(s).
This company only has to be a one-hit wonder to be successful initially and it looks like one or two of these platforms could be on their way to wider adoption. Oh, and don't forget the potential licensing of the operating system to a large OEM.
We know it pains you to see any hint of success from the company but do try to keep a stiff upper lip...
Timeline..Mediacast 2004 product preview - 27/04/04
One of the most intriguing new products to be featured at the forthcoming Mediacast 2004 trade show, which is taking place between the 25th and 27th of May at the Excel centre in East London, will be a so-called 'portable personal video recorder' or PPVR from Fusion.
According to Steve Lister, vice president of marketing at Fusion, this is "a small device with a three-and-a-half inch back-lit LCD screen screen. It’s got a 40GByte drive in it, and it connects on to one of our boxes, so you can watch TV and transfer your recordings on to it and watch them on the train the following morning." Lister told idtv.co.uk that the new device would be available in the UK "hopefully before Christmas, but more likely in the early part of next year."
Fusion will also 'hopefully' be demonstrating some new LCD IDTV products at Mediacast, said Lister, some of which feature built-in DVD and hard disk combinations. These would be "launching into the market in September," he predicted.
Among other highlights:
Cabot Communications will be unveiling the new software for its seven-day Freeview Electronic Programme guide (EPG). Since Cabot supplies the majority of Freeview manufacturers with its MHEG-based interactive TV 'engine', the new system is likely to become the default solution for most of the industry in the future..
SCM Microsystems will 'probably' be demonstrating its new Top Up TV conditional access modules or CAMs. These look like 'fat' smartcards, and plug into so-called common interface slots to allow them to take a Top Up TV smartcard and unscramble its pay-TV programming. All IDTVs have a common interface, but only a minority of current Freeview set-top boxes do.
FTA Communication Technologies says it will be showing "A state-of-the-art satellite and terrestrial DVR" or personal video recorder.
No doubt there will be further announcements to follow.
no pics yet.eom
On the other hand, is there really anything edifying about staring out the window at passing traffic or cornfields?
A little history..Not so fast forward
Personal video recorders have undeniable allure for TV-loving consumers. So why is the market stuck on pause?
Paul G Schreier, Contributing Editor -- CommVerge, 10/1/2001
Maybe, just maybe, this is the killer product the electronics industry has been waiting for. It's addictive. After only a few days, users can't believe they ever got along without it. Better yet, the potential market is enormous—equal to the number of TV-viewing households worldwide.
We're talking about the personal video recorder (PVR). That's the industry's somewhat unwieldy name for a hard-disk-based digital video recorder that can personalize your boob-tube experience. Questionable moniker aside, most observers agree that TV-loving consumers will eventually snap up PVRs in mass quantities.
Beyond this core belief, however, all is unknown. Though TiVo and other first-generation PVRs validated the concept, they simultaneously demonstrated that PVRs won't become a mass-market sensation overnight. It's still unclear when the broad consumer market will take off and what types of business models will succeed. And aside from these big-picture questions, product teams with a PVR on the drawing board must contemplate practical matters, such as what features their PVR should include and how to build it.
PVRs are much more than souped-up VCRs built around hard disks. In addition to storing up to 60 hours of programming, today's models provide a bevy of user-hooking features. First and foremost, they make use of a downloaded electronic program guide (EPG), which most obtain by making a phone call in the wee hours. The EPG allows users to select the shows they wish to record by name—a vast improvement over the arcane programming procedures common with analog VCRs.
What's more, a PVR presents its inventory of recorded material in a neat, point-and-click menu—no more fast-forwarding through a stack of 180-minute tapes looking for that episode of Futurama you taped two weeks ago last Sunday. If a sporting event you're recording runs long, a PVR can adjust. Some PVRs can record one program while you watch another, or even record two at once. Famously, some models observe your viewing habits and then make suggestions about what other shows you might like to record (for a personal review of these features, see our October 2000 Inside the Digital Den, "Big Brother"). As gravy, PVRs provide so-called "trick" features, such as the ability to pause live TV.
“There are 95 million TV homes in the US, and only a stand-alone PVR will serve many of them for a long time.”
Ted Malone, TiVo
As alluring as these features are, the market hasn't yet taken off (see the sidebar, "Delayed response"). However, Forrester Research estimates that 34 million Americans will have PVRs in their homes by 2005. This prediction should please all sectors of the electronics industry. "Consumption of these devices will be enormous," says Richard Johnson of Cachevision, a joint venture of Seagate and Thompson Multimedia that is developing PVR technology to sell to both manufacturers and service providers. "We expect that the number of hard disks consumed in PVRs could be as large as the number in the PC space."
Brainstorm about other places PVRs could ultimately go, and the numbers grow even higher. A PVR in the van could entertain kids on a long trip. A portable PVR (a PPVR?) could let you share programs with a friend in the same way you pass videotapes today. "Before we get to these applications, though, we have to see cost reductions in the technology and also make great progress in the area of digital rights management," Johnson adds. "Only after we see broad adoption of a usage model acceptable to the average consumer can we think about other form factors."
Unsettled
At this early stage, the PVR presents a rapidly moving target for any product team taking aim at the market. In fact, it's still unclear what the dominant PVR configuration will look like.
Many observers believe that the days of the standalone PVR are numbered. These integrationists argue that PVR functions will soon become a standard part of cable set-top boxes and satellite receivers. However, one of the remaining sellers of standalone units begs to differ. Ted Malone, director of product and service marketing for TiVo, says that his firm offers both standalone and integrated models (the combo box includes a DirecTV receiver). However, TiVo sells far more standalone units. "There are 95 million TV homes in the US, and only a stand-alone PVR will serve many of them for a long time," Malone says.
Those who favor integration argue that a standalone box forces consumers to learn two user interfaces, one for the PVR and one for the set-top box. Malone labels that claim as FUD (fear, uncertainty, and doubt) propagated by his competition. He explains that a TiVo typically controls the set-top box. When you send a channel-change command to the TiVo, it translates it into the command the set-top box requires. "You can essentially throw away the set-top box remote, except for authorizing a [pay-per-view] purchase," Malone says. Furthermore, customers who change cities and/or cable providers don't have to learn another EPG.
Forrester Research predicts that of the 8.2 million households expected to have a PVR next year, 43 percent will be built into satellite boxes. Cable operators will install another 20 percent and the remaining 37 percent will be other varieties.
“Can we really expect a universal box that combines games, digital cable TV, satellite TV, and maybe other functions? Likely not.”
Tim Bucher, Microsoft Ultimate TV
That last category includes standalone units as well as TVs with built-in PVR functions. One of the first such integrated products is the $900 PV-SS2710 from Panasonic, which combines a 27-inch PanaBlack television with the ReplayTV Showstopper PVR.
Some think such integration goes too far. Kris Narayan, founder and chairman of chip vendor TeleCruz, argues that the electronics, but not the hard disk, should go inside the TV. The standalone PVR isn't taking the market by storm, he says, so why develop a fancy integrated unit that won't sell? Meanwhile, today's TVs already contain processors, graphics chips, and other hardware that PVRs need.
The bill of materials for a TV with PVR electronics and a hard disk could run as little as $200 above that for a normal TV, he says. In fact, Narayan expects that we'll eventually be able to buy a TV that contains the PVR electronics but no storage, for just $50 more than a regular TV. TeleCruz's upcoming Cruzer 8 chip enables PVR functions.
But what about the storage? It's an issue of paramount importance, and opinions vary widely. The hard disk is the most costly element of a PVR's bill of materials, but it's also a commodity item, and hard disk capacities are continuing their rapid increase. For these reasons, it may make sense to keep storage separate from the PVR's electronics—whether you're talking about PVR functions in a standalone unit, a set-top box, or a television. For more on storage scenarios, (see the sidebar, "Where to hoard?").
Returning to the question of whether TVs should subsume PVR functions, you can chalk up a "no" vote from Jas Saini, vice president for consumer devices at middleware provider NDS Group. He argues that set-top-box hardware increases in power every two to three years, while consumers expect high-end TVs to last a decade. Integration into the TV might be viable down the road, he admits, when we've realized higher levels of disk capacity and when PVR functionality has matured.
Another interesting scenario might see a PVR teaming up with a video-game console. Given that Microsoft is preparing for the release of its XBox game console, it's perhaps surprising to learn that Tim Bucher, vice president of consumer products at Microsoft's Ultimate TV division, doesn't see the game and PVR functions as compatible. He points to three issues. First is proximity. Will someone watch TV and play games in the same room? Next is the quality of the experience. Gaming requires powerful 3D graphics processing, whereas TV is all about tuners and decoding data streams. To combine these might degrade one of the experiences. Third is economics. "Can we really expect a universal box with games, digital cable TV, satellite TV and maybe other functions, at a price point that would be palatable to consumers?" he asks rhetorically. "Likely not."
Bucher goes on to note that cable and satellite operators subsidize the cost of set-top boxes, because their main concern is signing consumers up for revenue-generating services. They have no incentive to create a box that would put competing or distracting services at the consumers' fingertips. Furthermore, trying to build a product that would comply with the requirements of multiple services would be a nightmare.
Finally, doesn't it make sense for a PC, which already has a hard disk and ample computing power, to serve as a PVR? Steve Shannon, vice president of marketing for ReplayTV (now part of SONICblue), believes that while the scenario is feasible, and products to enable it are on the market, they won't become very popular. Most consumers would rather not bother with finding the right jacks, getting the proper cables, and setting up the software, he says. Most importantly, the deskbound PC doesn't suit couch potatoes. "It's a PC experience, not a TV experience," he concludes.
Nonetheless, last fall Microsoft announced a software component for Windows XP that enables PCs to perform interactive-TV tasks including PVR and EPG. However, Laura Norman, marketing manager for the Microsoft TV group, doesn't see PC-based PVR competing with living-room systems.
Let's build
Take a superficial glance at PVR functions, and you might assume the devices would be easy to design. Not so, according to people in the industry. Building a PVR is much more than adding some electronics and a hard disk. The software, in particular, needs to be highly sophisticated.
"OEMs are used to building a VCR, where it's a bounded problem—a tape drive, then NTSC in and out," says Cachevision's Johnson. "[With a PVR,] not only is the problem no longer bounded, but you're also dealing with outside information. What form will the EPG take? What's the format of the delivery of the data associated with services?" With traditional consumer-electronics gadgets, component suppliers often deliver full reference designs. "With PVRs, these designs are perhaps 70 percent complete," Johnson notes. "The remaining 30 percent presents a formidable challenge."
In looking for assistance, happily your choices are widening. "The contribution from a PVR design house can be as basic as file-management software to the other extreme: a separate appliance that connects to a set-top box over a serial cable," Johnson says. "Thus the price range goes from tens to hundreds of dollars depending on the circumstances."
Having found only lukewarm success with dedicated units, major suppliers of standalone boxes have reexamined their philosophies and are now looking to license their technologies.
Even TiVo is switching gears along these lines. Malone notes that the company started out thinking it would develop and license platforms, reserving most of its effort for services. Given market realities, though, the firm has refocused. It no longer just supplies a reference platform, but is also looking to license its intellectual property. Along these lines, TiVo has secured several patents for PVR technology, and while competitors say there are many ways to perform a given task, Malone responds that most of TiVo's big competitors have also come to the table to talk about cross licensing.
To see where special technology comes into play, consider scheduling and disk management. It's easy to implement a FIFO (first in, first out) scheme and erase a file after use. In contrast, TiVo's per-show scheduler and file manager examine the disk and, if there's not enough room to record an upcoming show, make suggestions about which shows the user might choose to erase. This all happens in an inexpensive hardware platform consisting of a PowerPC processor and 8 Mbytes of RAM.
Further, the file system works with both large blocks, such as TV programs, and small blocks, such as EPG data. Some competitive systems store EPG data in RAM, and it disappears if power fails. As another example of the complexity of PVR designs, EPG-related read and write activity on the disk in a poorly planned system could interfere with recording, possibly leading to problems with audio-video synchronization.
“Consumption of these devices will be enormous. We expect that the number of hard disks consumed in PVRs could be as large as the number in the PC space.”
Richard Johnson, Cachevision
Product teams looking for design help might also turn to the other major player, ReplayTV, which until recently also sold a standalone unit. Sluggish acceptance of the PVR concept prompted the firm to exit the retail market and adopt a licensing stance. However, the firm was recently acquired by SONICblue and shortly thereafter announced a new line of high-end PVRs (see "Replay returns" in this month's GEAR section).
UK-based Pace Micro Technology, which claims to be the world's largest dedicated supplier of set-top boxes, is moving in a similar direction. Pace has developed its first PVR for use with Britain's BSkyB satellite system. Although the company has traditionally held its technology closely, Pace is now looking at licensing its know-how, according to Terry Glatt, the company's director of technology for the Americas.
Hard code
As noted above, hardware is easy compared to the complex software needed to manage PVR features. Focusing on that end, Microsoft offers its Microsoft TV software platform, which aims to help network operators provide interactive TV services to their customers. The group produces middleware for both the set-top box and the cable head-end, but not end-user applications. An example of a head-end application would be pushing targeted ads to users based on their viewing habits.
The MSTV platform also includes software licensed from others, such as conditional-access middleware from NDS Group. For hardware assistance, Microsoft TV is working with Broadcom to supply a reference platform for implementing PVR functions on MSTV-based set-top boxes. Microsoft is particularly proud of a real-world deployment with TV Cabo Portugal, claiming it's the first commercial interactive cable service to include PVR functionality delivered via a set-top receiver.
Yet another group at Microsoft is responsible for Ultimate TV, a service built on Microsoft TV. Whereas MSTV deals with middleware, this group focuses on consumer services and also creates an infrastructure into which Microsoft can deploy such services. The Ultimate TV group creates and licenses reference designs for set-top boxes to manufacturers, but its revenues come primarily from the pockets of consumers in the form of monthly service fees. The best-known implementation is a deal whereby Ultimate TV is integrated into a box offered by DirecTV for its satellite service. This unit combines satellite programming, PVR functions, live TV controls, interactive TV, and Internet access.
Chip developments
In addition to licensing software to Microsoft and others, NDS Group also provides technology to chip vendors. The cornerstone of the company's approach is a technology called RASP (random access to scrambled content protocol). The technology inserts access points into encrypted content on a hard disk, allowing a PVR to more easily implement modes such as fast-forward and rewind. If the content has the right attributes, the technology can also provide an analog output suitable for recording by a VCR. Adding RASP to a processor takes just a few hundred logic gates.
Conexant is one of a half dozen companies incorporating RASP into ICs. And these specialized devices should lower consumer prices for PVRs. "From a semiconductor standpoint, TiVo and Replay boxes are cobbled together with existing technology," says Jamie Ching, MPEG product-line manager with Conexant. "But now we're getting technology directed at PVRs." For instance, early encoder/decoder chips were designed for single-stream applications, but upcoming chips have dual inputs and outputs, thus enabling the critical ability to watch one program while recording another.
“From a semiconductor standpoint, TiVo and Replay boxes are cobbled together with existing technology. But now we’re getting technology directed at PVRs.”
Jamie Ching, Conexant
Another chipmaker, Broadcom, also focuses on TV encoder/decoder chips with integrated MPEG operations. The firm's latest device is a dual-channel MPEG encoder that also handles four audio channels. "It's important to incorporate more functionality into chips to make them more cost effective for embedding in TVs," says Brian Lemelman, Broadcom's director of digital video technology marketing.
Developments are taking place on the CPU side, as well. For example, Equator Technologies has developed the MAP-CA, dubbed a BSP (broadband signal processor). The device is fully programmable using the C programming language. According to Ben Cutler, cofounder and vice president of corporate planning and business development, this speeds up the development process because programmers are more productive in C. By contrast, DSPs (digital signal processors) often require assembly-language programming—which is more complex and time consuming. Cutler says that none of Equator's existing customers has written any assembly code whatsoever.
Targeting video-intensive applications, the chip delivers 30 billion operations/sec. On the PVR front, the firm has signed an agreement to integrate wavelet-based video compression from Droplet Technology. A single MAP-CA chip can execute two Droplet encoders and one decoder. Equator's devices run at 250 to 300 MHz. Basic PVR functions consume 120 MHz. Adding functions such as live pause increases the load to about 200 MHz, meaning there's still power left over for extra features. Recently, Equator unveiled its Dolphin reference design platform based on the MAP-CA. Samsung is using Dolphin as the basis of its SMT F300 interactive set-top box.
Author information
Contributing Editor Paul G Schreier (aa1mi@ARRL.net) is president of Amitech Marketing (Berne, Switzerland), which specializes in high-tech marketing. He doesn't own a PVR, but if he did, it might be filled with Notre Dame football games.
Digifusion worlds-first pPVR
2004-05-23 18:02:48 / Anna Sulisz
Source: Fusion
Fusion Digital Technology has unveiled the world's first Portable Personal Video Recorder (pPVR) allowing users to access both audio and video content on the move, together with the ability to store such content on its internal Hard Disk Drive without the need to interface with a PC.
The Digifusion pPVR can access content in one of three ways. 1) Conventionally via its USB port, images, audio files, movies etc can be transferred from a PC. 2) By direct connection to an audio or composite / S-VHS video source using the units inbuilt MPEG encoder. 3) By direct digital connection to a dedicated Digifusion set top box or Digital Video recorder.
Featuring both MPEG 2 and MPEG4 playback, plus MP3 and WM9 audio support, the pPVR’s integral 20 GB hard drive enables storage of up to 40 hours of video programming. With a built-in, back-lit LCD display, the Digifusion pPVR is a transportable media centre which can be used whilst travelling or at home through a home entertainment system, It allows users to watch their favourite TV programmes or listen to their favourite music wherever they are.
Unlike any similar portable products currently available which are PC-centric, the Digifusion PPVR is able to interface with content without the need for a PC.
Downloading content from the internet and other sources is now an established method of acquiring audio and video files. The already buoyant market for personal jukeboxes is set to rise dramatically in the next few years and is likely to be fuelled even further with the introduction of personal entertainment centres such as the highly versatile Digifusion pPVR.
Barry Rubery, CEO of Fusion Digital Technology Ltd commented, “There are two major markets for this product. Firstly the retail market where consumers can use the product to store audio and video content and record in much the same way as they would with a static VCR. Secondly, it provides supplementary product opportunities for Pay TV operators, who as we know, are continually searching for new revenue streams and ways to reduce ‘churn’.”
For a demonstration of the pPVR as well as a host of other exciting consumer electronics solutions, please visit Fusion Digital Technology on Stand D12 at Mediacast ExCel, London, 25-27 May 2004.
Startup Eyes Music Downloads Without PCs
By Joseph Palenchar -- TWICE, 5/21/2004 7:41:00 AM
New York – A start-up company believes it can broaden the customer base for authorized music downloading if it eliminates PCs from the process.
The venture-capital-funded company, New York-based Music Gremlin, has developed a reference platform that lets consumers download music directly to handheld music portables via home or office Wi-Fi network or via public Wi-Fi hot spots. The music would be downloaded from a Gremlin-operated site.
Eventually, music portables could be equipped with third-generation (3G) cellular technology or with IEEE 802.20 wireless technology, which is under development to deliver wide-area high-speed data to portable and hand-held devices.
Music Gremlin is testing its product design and download service with consumer electronics companies and believes the first product could be available in the fourth quarter, said Robert Khedouri, one of the company’s principals.
"Cellular carriers are interested in this type of service in the ’05 timeline," Khedouri added. "We’ve been approached by music stores" that would offer in-store download services, he added. Retailers are interested in private-labeling the portables and the service, he noted.
The platform accommodates either flash memory or hard disk drives as the storage medium in music portables, and it can be incorporated in PDAs based on Microsoft and Linux operating systems. It also accommodates a variety of codecs and digital rights management (DRM) technologies. The first devices, however, will use the Windows Media Audio (WMA) codec and DRM, the company said.
In an unusual twist, a database of about 500,000 song titles would reside on the portable device itself, enabling consumers to choose songs for downloading before making a wireless connection. The database would be updated automatically either when the device is connected to a Wi-Fi network or when it’s docked in its charging cradle, which could connect directly to a broadband modem via an Ethernet connection.
Adding Wi-Fi to a portable music player will not compromise size or battery life, Khedouri said. Wi-Fi’s power demands won’t "significantly shorten" battery life because Wi-Fi would be used only during download periods, he said. Battery life would be competitive with Apple’s iPods. Wi-Fi chipsets don’t take up much room, he added, and a Wi-Fi antenna can be built into the device’s case.
If granted approval from music labels, Music Gremlin’s download service would offer two options: a flat-fee monthly subscription service and an a la carte service. The a la carte option lets consumers permanently own downloaded songs, which could be transferred to a limited number of PCs. Under the subscription model, subscribers could download all the songs they want and listen to them as long as a subscription is paid up.
With a subscription, users could not transfer songs from their portable to a PC or to non-Gremlin portables, but during the subscription period, DRM-protected songs could be shared with other Gremlin subscribers in one of two ways: a peer-to-peer Wi-Fi connection or over a broadband network. Subscribers could, for example, click on a name on a buddy list to view and download songs recently downloaded by a buddy.
When a subscription lapses, consumers would be able to buy their downloaded songs. Subscribers could also customize the service, directing the service to push a certain number of songs of a particular genre, for example, to the device at different times of the day.
A hybrid streaming-radio and download service would become feasible with 3G cellular versions of the device. The company demonstrated its service over Flarion’s high-speed wide area wireless network during the Cellular Telecommunications and Internet Association (CTIA) show earlier this year.
Khedouri is an attorney who was a McKinsey consultant to the music industry on other strategic issues. Principal Jonathan Axelrod was a McKinsey consultant on e-commerce and a founder of the Music123 site, which sells musical instruments on a wholesale and retail basis.
Investors include MPH Enterprises and a former Proxim CEO, they said.
Can see progression..McDonald's wades deeper into DVDs
By Bruce Horovitz, USA TODAY
Blockbuster has a very big-footed rival about to stomp on its turf: Ronald McDonald. McDonald's (MCD) on Monday will announce plans to begin testing DVD rental kiosks at all 105 Denver stores.
A DVD rental kiosk at a McDonald's in suburban Denver.
McDonald's
Smaller tests around Washington and Las Vegas had a huge response.
If the summerlong Denver test is a hit, McDonald's hopes to become the first fast-food chain to rent top DVDs nationally.
DVDs will be rented at Redbox kiosks, situated inside and outside restaurants. Rental fee: $1 a day — and they can be returned to any McDonald's. At Blockbuster (BBI), DVDs cost $3.99 for three days and must be returned to the same store. The McDonald's kiosks will stock the same top 30 DVD titles as video stores. The top 30 account for about 80% of DVD rentals.
The move could shake up both the $25 billion DVD business and the $105 billion fast-food industry. Over time, it could further blur consumer distinction among the convenience store, the fast-food joint, the gas station and the DVD rental shop.
Convenience continues to be the dominant marketing strategy of many of the USA's biggest retailers. About 29 million dual-income families have little free time to make extra stops for food and entertainment.
It's tough to top Mickey D's for convenience. While there are upwards of 30,000 McDonald's restaurants globally, there are about 8,900 Blockbuster stores.
Blockbuster officials declined to comment.
McDonald's isn't trying to put Blockbuster out of business. But it is trying to be more contemporary — and to lure more business during slow dinner hours.
"We are doing everything we can to be more relevant with everyday consumers," says Mats Lederhausen, managing director of McDonald's Ventures.
It's a very crafty — if not sensory — move for McDonald's, says Valerie Folkes, chairman of the marketing department at the University of Southern California. "They just want people to get inside, where they're subjected to the smell of those french fries. It's going to sell more food."
That is all McDonald's wants. Lederhausen says he doesn't expect to make money from DVD rentals.
DVDPlay, which makes the machines, says it can supply a national rollout. The kiosks also are being tested in some Albertsons supermarkets in Salt Lake City, says Dee Cravens, marketing chief.
McDonald's has long declined to share real estate with other businesses. This forces it to learn a new business. "It could blur the brand image," Folkes says.
But it poses far more trouble for Blockbuster, whose parent, Viacom, has plans to spin it off.
How to compete with McDonald's — besides on DVD selection? "Well," Folkes says, "I don't think you'll see Blockbuster selling burgers anytime soon."
Philips CryptoWorks Partnership in China
DTVIA Conditional Access System (ChinaCrypt) Co. Ltd., registered in Beijing Economical and Technological Development Area, is a joint venture of Beijing DTVIA Investment Co., Ltd. and Philips Electronics China B.V.
The company is engaged in the marketing & sales, system integration & installation, local development & production of DVB- and IP- conditional access systems and relevant software in China under the brand name ChinaCrypt. It also provides the relevant technical consulting service, technical service and after-sale service. The ChinaCrypt system is based on the technology of Philips' well-proven CryptoWorks solution and is adapted to the local Chinese requirements.
With the large demand for cable-delivered TV services and government efforts at various levels, the Chinese DTV market will develop very rapidly in the coming years. As one of the main CA system suppliers selected by the State Administration of Radio, Film and Television (SARFT), ChinaCrypt will greatly contribute to the further development of the DTV broadcast market in China.
Since the formation of DTVIA Conditional Access System (ChinaCrypt) Co. Ltd.,, in March 2001, the joint venture now has many customers throughout China. As well as some satellite operations, ChinaCrypt CA solutions are mainly applied by digital cable TV network operators, who are starting up their digital TV roll-out according the Chinese DTV program.
Among the recently acquired key customers, Beijing Gehua CATV Network Co., Ltd. is the first cable operator to implement the ChinaCrypt IP Conditional Access solution. This IPCA end-to-end system enables encryption, decryption and authorization of specific data broadcast services to smart-card enabled PC users connected to the cable network. It makes use of all the familiar standard elements in a DTV CA transmission and distribution path, plus additional ChinaCrypt IP extension to handle IP encryption, supplied by ChinaCrypt and Philips.
For contact info regarding ChinaCrypt and for further details about the company, product, partners and customers, please visit www.dtviacrypt.com.cn/www_english