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UIT's Smart Toys Make All Media an Interactive Experience
by Anna Dorfman
Imagine if your toy was privy to the season finale cliffhanger of your favorite show before you were, or if you could practice your Russian with a pen-pal that responded in her own flawless native tongue through a digital image on your screen... These are some of the promises of Los Angeles-based United Internet Technologies (UIT), a subsidiary of United Leisure (OTC BB: UTDL) which is offering up a new generation of interactive toys at this year's American International Toy Fair, premiering in New York this week.
The company's first product for mass-release is The Terminator-inspired "Endoskeleton," which was designed by special effects guru Stan Winston, the creative mind behind the chilling creatures of Predator, The Terminator, Aliens and Jurassic Park. According to UIT President Brian Shuster, this is only the beginning of a licensing campaign to incorporate popular media entities' toys with interactive technology. So, in the future, Harry Potter fans may own a replica of the little wizard that reads to them in a high-pitched British accent, or a Howard Stern toy that heckles with them at Who Wants to Be A Millionaire contestants.
Shuster related that UIT's patented Intelligent Control Interactive Technology (ICIT) will "allow us to take products, be they health devices, toys, refrigerators, etc… and enable those products to communicate and respond intelligently." Whatever the product, it can be controlled using a mouse, joystick, wireless device or keyboard in real-time. The toy can also be a digital representation on a computer screen, a WAP-enabled phone or a Palm 7. The communications protocol for ICIT is the embedding of various codes and signals into a hidden communications spectrum--whether it is Internet-based, wireless or a piece of a broadcast spectrum for TV.
To enable a toy to interact with a television program, for instance, ICIT begins the process in a show's post-production phase. At this point, the company's technology writes the dialogue and movements for the toy to become an active participant in the production. This audio/visual script is then converted into digital information and embedded into a standard master tape by UIT. The master tape is broadcast to the end user's television set, and the stored information is placed into a box decoder before it comes out on the TV. As the show is running, the code with the embedded script is extracted by the decoder and transmitted to the toy, so it can respond accordingly. If the ending to your favorite program turns out to be a real clunker, your interactive companion won't necessarily take it quietly, or even lying down.
Shuster stipulated that the broadcasting arena won't be the first outlet for UIT's line of toys. The first phase--the Endoskeleton--is set to rollout in October, and will target online chatters. Shuster noted that 1.2 billion Instant Messages are sent out everyday in the U.S., and his company's toys can bring this interaction into a "3-dimensional world"; chatters can articulate their messages through these toys, whether they are physical or digital, using their own voices, as well as program movements to highlight their tones or moods. For instance, "spicegirl258" can punctuate a flirtatious sentiment with a wink or a smile through a toy. Currently, ICIT has built-in autotranslation for four languages--English, German, Spanish and French--with more on the way.
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If the ending to your favorite program turns out to be a real clunker, your interactive companion won't necessarily take it quietly, or even lying down.
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The next phase of toys will target game consoles, and have the ability to coach and guide users through specific games; this rollout is scheduled for June or July of this year. Shuster explained that "in the next few months, there will be fierce competition in the game console industry as Microsoft's Xbox comes out--so that game console makers are anxious to add on enhancements". Much like the television example, ICIT will embed its code into the CD-ROM-which, of course, opens up another market as well--DVDs. Both the game console and DVD markets "need new drivers," said Shuster, and he thinks his toys are it. The company is betting that networked toys and online gaming represent the growth engine in the toy and video game industry, and projects that pervasive gaming will generate $26 billion in revenue by 2005.
TV is the last revenue stream UIT will explore--including the iTV space. But, Shuster thinks this particular market is still a few years away from being viable, so the company is taking a slower approach here. But one day, he said, even watching cooking shows will present an entirely different experience, as your appliances--be they oven, blender or microwave--with embedded ICIT respond to instructions from a television program, while a precise recipe gets downloaded into your Palm. "This seems far-fetched," he said, "but three years ago, no one would've believed that WAP would be possible."
UIT prides itself on having technology that fits all platforms. In order to access all of the different players, however, the company has to enter into a number of licensing and revenue-sharing agreements. For phase one, Shuster elaborated, UIT "needs to establish a relationship with major online portals where lots of chat rooms happen." From there, phase two demands agreements with both the console makers and the game content developers, so that ICIT can access the information in the CD-ROM and embed strategies and useful advice for users--similarly, for DVDs, the company has to license the content it wants to incorporate into its offerings, and strike a deal with the actual distributors and makers of the DVDs. Finally, television penetration means negotiating with heavy-hitters like Microsoft and AOL for the iTV space, and partnerships with broadcasters, content owners and networks for standard television.
Despite the intricate set of relationships necessary to make ICIT possible, Shuster insisted that this is not an expensive proposition. The infrastructure, he posited, is based on an open platform involving both software and hardware. Because it is an open platform, he explained, "others can develop it… We made it cheap to use, so we don't have to restructure or upgrade." In the same vein, companies could simply license ICIT and include the technology in their games, DVD offerings or other products.
Shuster said the technology has been in development for four and a half years, when the wireless space was still a pipedream. Initially, the toys were meant to be Internet-based, but the possibilities since then have multiplied. And while the company is also looking into medical technology, and installing ICIT chips into hardware devices such as blood pressure monitors, as well as appliances and other products for connectivity, it started with toys to corner a "youth-oriented market," as kids are often early adapters of technology.
And despite ICIT toys' high-tech elements, UIT has developed them to be affordable. The "Endoskeleton" model will retail between $50 and $70 dollars, with another $35 to $150 in potential costs for additional capabilities, such as a camera or TV-enabler. Consumers can also download new moves and features onto their toys as they become available. So, say good-bye to "Furby" and "Talking Elmo"--there's more interactive fun in store than ever before.
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