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07/02/03 3:24 AM

#40150 RE: Tenderloin #40149

PluggedIn: Pocket TV jukeboxes creep toward prime time
Tuesday July 1, 2:53 pm ET
By Franklin Paul


NEW YORK, July 1 (Reuters) - Portable digital video players make it easy to pack Bach, Beck and a season of "Brady Bunch" episodes into one pocket-sized gadget, but consumers initially may balk at the hefty cost and limited video programming choices.
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This new wave of gadgets is aimed at frequent travelers and young people who are comfortable with digital music and video. About the size of a John Grisham paperback and encased in shiny metal, they can hold dozens of full-length movies, thousands of music files and pictures, with space left over for storage.

The Jetsons-age vision of carrying all your favorite television programs and songs in the palm of your hand brings to fruition a dream: that one man can be a walking warehouse of good tunes and moving pictures.

Twenty years ago such a claim might have meant that a person had his media collection -- on hundreds of albums, cassettes and video tapes -- loaded in one's recreational vehicle, with a "roadie" waiting to lug it around.

Still, despite their small size and "gee-whiz" appeal, it may be years before consumers warm up to personal video players -- also called PVPs -- in the same fashion as its popular digital cousin, the MP3 player.

"There is not nearly as much momentum behind portable video as there is behind portable audio," said Yankee Group analyst Ryan Jones. "But it's still pretty early for these devices."

Just three years ago, downloading movies and sharing digital video was still considered a far-off notion. Only recently have portable music players became mainstream gadgets, and prices for digital home video cameras have come down. As such, the portable video market has arrived sooner then expected.

POWERFUL, YET PRICEY

The video jukeboxes come with a screen about 3 inches wide and 2 inches tall -- just larger than a credit card. The first two models originate in France, from Archos, with its AV320 and Thomson's (Paris:TMS.PA - News) RCA Lyra RD2780, due this fall.

Starting with 20 gigabytes of memory, each is about the size of a paperback book but has the weight of a hardcover. Both can play back digital video transferred from a video camera or other material acquired at home or on the Internet.

In addition, they record from television, much like a video cassette recorder, and Archos sells an add-on camera that turns the jukebox into a video camera. RCA's Lyra lets users program it to start and stop recording television shows at a set time.

Danielle Levitas, an analyst at research firm IDC, said consumers wowed by the their abilities may be put off by the price: the Archos tops $500, and the LYRA sells for $400.

"Most consumers think twice before they drop $400 ... and I don't see the cost coming down dramatically for a couple of years," she said. "Plus, there is competition from existing popular technology like portable DVD players."

Indeed, video-in-your-pocket is not a new idea. Frequent airline flyers can often be seen watching Hollywood's best on portable DVD players, whose screens are bigger than the PVP. Many of the same people who might buy PVPs already own laptop computers, which can play both DVDs and digital video files.

Other devices, such as Panasonic's SV-AV30, let users record from TV and play back the video, but have far less capacity. These machines, popular with camera enthusiasts as a way to view digital pictures, record data in increments of about 256 megabytes, or 80 times less capacity than a 20-gigabyte drive.

Personal digital assistants (PDAs) -- such as Sony's TG-50, JVC's MP-PV331 and Palm Inc.'s (NasdaqNM:PALM - News) Zire 71 -- also play video in the MPEG-4 format. This is to video what the more familiar MP3 is to digital music recordings. But PDAs also carry very limited memory for watching films, and are pricey: Sony's and JVC's models sell for more than $400 each.

Besides the fact that the world doesn't need another three-letter acronym to remember, PVPs face other issues that could keep buyers away, such as concerns over short battery life and difficulty acquiring videos to view on the machine.

With the advent of PCs that pull songs from CDs and turn them into MP3 for portable use, music files are ubiquitous in homes and on the Internet, although not without some protest from music industry bigwigs who worry about unlawful swapping.

"We are seeing between 5 and 6 million households in the U.S. downloading feature-length content on a regular basis," Jones of Yankee Group said. "That's not just car commercials; that's TV shows or full-length movies."

Should these models succeed, experts see competing devices coming from companies such as Apple Computer Inc. (NasdaqNM:AAPL - News), whose iPod dominates the audio "hard drive" market, and Sony Corp.(Tokyo:6758.T - News), the world's biggest consumer electronics maker.

(The PluggedIn column appears weekly. Comments or questions on this one can be e-mailed to franklin.paul(at)reuters.com.)