To: DiViT who wrote (27268 ) 12/30/1997 1:54:00 PM From: Stoctrash Respond to of 50808
Monday December 29 12:28 PM PST Year in review: Hardware By Robert Lemos headlines.yahoo.com PC hardware makers and consumer electronics companies got downright serious about having fun and hitting home. From industry giant Intel Corp. focusing on tailoring its architecture for entertainment, to Internet-TV device makers duking it out in the fledgling market, the hardscrabble competition was intense. Intel maintained its vise hold on the market for PC processors with its release of the Pentium II processor in May. The company also designed changes to the Pentium II architecture to improve performance: a faster graphics bus paired with a new cartridge and interface, called Slot 1, which offered better memory access. But Intel was under challenge like never before as rival Advanced Micro Devices Inc. released its "Pentium killer" -- the AMD-K6 chip. AMD's strategy was to price its product 25 percent below comparable offerings from Intel and the move worked -- the company sold every processor it made. But AMD, which encountered production problems, only shipped an estimated 1.5 million to 2 million chips -- much lower than the 3 million it originally predicted. Still, AMD added key OEM partners including IBM Corp. and AST Computer Corp. After several false starts, the sub-$1,000 PC market emerged for real in 1997, grabbing about 40 percent of the retail market. The public's taste for less expensive systems forced Intel to do an about-face as the chip maker also jumped into the fray -- albeit later than its rivals, AMD and Cyrix Corp. (which was purchased by National Semiconductor Corp.) At even lower prices, set-top Internet boxes started to get some recognition in the industry. Analysts estimated that WebTV Networks Inc. -- the leader in this area -- sold about 200,000 units during the year, short of its hoped-for 250,000 mark. Yet interest from the cable industry and early adopters helped validate the market. Set-top boxes/NCs adding additional features, such as Internet connectivity, are predicted to drive the interactive TV market. "We are expecting about 5 million subscribers to Internet TV services by 2001," said Paul Di Senso, senior consultant for SRI Consulting. With set-top box providers such as NextLevel System Inc. -- now, General Instruments -- doing deals for 10 million to 15 million digital cable boxes over the next five years, enhanced TV seems to be coming fast. Roll into all of this, digital versatile disc, or DVD, and the prospects for a box on your TV are better than ever. Yet many in the industry are claiming that growth is "slow." But Jae Kim, industry analyst of Paul Kagan and Associates, remarks that's an illusion -- about 450,000 home players will be shipped this year alone. "DVD is growing far faster than, say, VCRs or CDs," he said. At Christmas, early adopters should have 500-plus movie titles from which to choose. For sheer home entertainment, however, video games have continued to grab first place. Sales of video games and video game players once again outstripped PC game sales. According to the NPD Group, a marketing information company, total sales for video games in the first three quarters of 1997 topped $1.5 billion, up 60 percent from the same period in 1996. PC games have grown only 10 percent, to reach $979 million. Yet with the next Sega system rumored to run on Microsoft Corp.'s Windows CE, video games and PC games may soon be the same thing.