Here's where our industry is going, yours and mine converging. How to make money in this without getting into some huge asian conglomerate?
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Linux TV
Benjamin Fulford, 02.02.04
The world's top electronics makers are rallying around
an operating system--and it's not Windows.
It's getting harder to tell the difference between
the hardware in the living room and the den. Devices
for playing music and movies and for storing and displaying
photos are beginning to resemble personal computers,
and vice versa. This so-called convergence just took
another giant leap in the fall at two Asian trade
shows--one for the PC industry, in Taiwan, and the
other for consumer electronics makers, in Japan.
Both shows promoted proud little boxes with big hard
drives and fast microprocessors. They can store and
play back hundreds of hours of video, make DVDs, archive
digital photographs, play music, e-mail, access the
Internet and more. All this can be done using a remote
control and, the makers claim, without having to read
the manual. These boxes are ushering in the day when
PC shoppers may figure they no longer need a PC. The
screen in the living room will suffice.
That's opening a rift in the software business among
purveyors of operating systems to run the multimedia
home. Right now things are not looking good for Microsoft.The boxes at the show in Taiwan, the world's PC manufacturing hub and a land loyal to Bill Gates, run on Microsoft Media Center software and Intel microprocessors. They cost around $1,000, in part because of the high costs
of the operating system and the processor. Most are
made by small firms that have yet to sell significant
quantities.
In Japan the boxes, called hard-disk recorders, are
made by Sony, Matsushita, Toshiba and others. They
use specialized chips running either the open-source
Linux operating system or proprietary systems. They
cost between $400 and $800, and Japanese firms sold
1.4 million of them last year, with 5 million more
expected to sell in 2004. Almost none run on Windows.
All the electronics giants--including Samsung, Sony,
Matsushita and Philips--have united behind Linux and
plan to phase out their proprietary systems. The Taiwanese
PC manufacturers have been hedging their bets by combining
Linux and Windows in many of their new entertainment
PCs. Even Microsoft gave ground, agreeing in September
to develop software to run on the Tron operating system
favored by many Japanese electronics firms and car
companies.
To Matsushita (see story) and Sony, and to many PC
makers, Windows and Intel technologies are not fundamentally
suited to the audiovisual life, which customers expect
to be as easy as pushing a button to start the music,
as opposed to waiting 90 seconds to boot up. Mitac
International, a large Taiwan-based PC manufacturer,
uses Linux to run a big chunk of its new audiovisual
PC. "You can get high-quality video and audio in seconds.
We short-circuit the boot process using Linux," says
President William Ho.
Also, it's cheaper to use alternative chips and Linux,
an operating system developed for free by a loose
global confederation of programmers. "As the price
of a PC falls, the portion of the cost that goes to
Wintel is rising," says James C. Chen, a vice president
for Acer, another big PC maker. "It costs $65 for
Windows and $2 for Linux," he adds.
Over time all sorts of consumer products will connect
to one another and the Internet using Linux, says
Kunio Nakamura, president of Matsushita, the world's
largest consumer electronics company. "We will be
able to use mobile phones to control the TV set,"
he predicts.
Linux does require more sharing of trade secrets. Recently
Toshiba came out with a Linux-based portable music
player and was asked by Taiwanese and Chinese would-be
clonemakers to reveal the code used. "Since Linux
is open, we will reveal the code to anybody who asks,"
says Toshiba spokesperson Midori Suzuki. Toshiba will
differentiate its product with superior hardware,
she says.
Microsoft has moved quickly to address its critics.
"I am not saying you want to be clicking around with
your mouse when you are watching your TV; people want
a remote control. We have been looking at this very
closely," says Jonathan Usher, director of digital
media for the software giant's TV group. Microsoft
has been working on instant-on capabilities and subsets
of its operating system small enough to run simpler
consumer electronics devices. Yet the firm is insistent
on the primacy of PCs. "The Windows PC has emerged
as a fantastic place to discover, download and manage
all sorts of media. For many, the PC is already an
entertainment device," he says.
The most likely outcome will be devices running more
than one system. "We will probably end up having open-source above a certain layer of the software and then use
our own tricks and black-box hardware underneath,"
says Susumu Koike, head of research for Matsushita.
He adds: "We are not concerned about Microsoft." But
Microsoft had better be concerned about Matsushita.
forbes.com |
