Dark Horse
Chipmakers Reject the PC/DTV.(PC technology to be incorporated into TV rather than vice versa)(Industry Trend or Event)
11/16/98
Electronic News
Page 27(1)
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san jose-The analog television market is growing the fastest in the 32- inch and up
consumer market. Because OEMs see consumers paying extra for large televisions with
additional functionality, they have taken this same concept to the high definition television
(HDTV) space.
This is one of the reasons, OEMs have started looking to numerous large viewing
systems to deliver these digital signals to the masses. Whether it's a plasma flat panel
display that allows a consumer to "hang" the TV on a wall, a microdisplay HDTV
system, that requires a full service projector to show huge television broadcasts on walls
and screens, large screen rear-projection televisions (the 70-inch and up variety), or
through the broadcast PC (PC/DTV), combining both PC and DTV into one box. CE
and PC OEMs believe these areas will increase their margins and bump up their
volumes for the coming years-driving revenues.
However, a vote of non-confidence has risen at the semiconductor level for the
Broadcast PC. Although the Wintel camp is starting to do promotions of its own,
semiconductor manufacturers are looking at all of these other means of delivering
HDTV and steering clear of the PC/DTV.
"We are not very bullish on (PC/DTV)," said Jonathan Cassell, senior analyst at
Dataquest in San Jose. Mr. Cassell said he sees more PC functionality being moved to
the consumer space rather than the other way around-multiple components such as x86
processors or perhaps graphics chips integrated into CE applications. What is already
happening, he noted, is a move to integrate hard disk drives (HDDs) in set-top boxes to
record video programming like on a DVD player. Some of this convergence may
continue but full industry wide adoption of watching programming on a PC "doesn't have
a lot of use to (Dataquest)," he said.
"My senses tell me that the consumer wants to go home and be entertained by turning
on their TV and pushing the channels up and down," said Tony Pellechia, VP of
consumer business unit at STMicroelectronics. "Maybe in 25 years PC/DTV may be
the mode of operation for watching programs but right now generations of consumers
like to go home, sit down on the couch, turn it on and flip their clicker. No one wants to
boot up their TV or have it crash on them during their favorite program."
As for other delivery systems, Mr. Cassell sees plasma flat panel displays, microdisplay
projection systems and rear projection televisions all having a place in the market. The
question will be determining what will be able to show the highest resolution quality at
the cheapest price. "Most of this comes down to the convergence of technologies," he
said. "With more functions being added to televisions and set-tops each day, I wouldn't
be surprised to see multiple new delivery systems for HDTV in the near future. On the
PC, though, I don't see it happening."
Peng Ang, CEO of TeraLogic said HDTV and PCs do not really go together because
PCs lack the volume demand that most consumer electronics manufacturers are looking
for. He admitted it might be an early volume winner because of the small requirements
needed-an add-in tuner card-to receive broadcasts, but in the long term, consumers will
want a television in excess of 40 inches to display these high-resolution images.
Mr. Ang also believes that in order to proliferate the DTV market rather quickly, the
price for the televisions, DTV set-top boxes and converter boxes has to be reduced to
a level that most consumers can afford. Plasma FPDs, microdisplay projectors and
rear-projection televisions are far too expensive and won't come down for a number of
years, he noted. This means set-tops with digital functionality and conversion capability
are more likely the best choice in the short term, the PC is left for the corporate world.
"My general belief is the PC is not the right platform," said Chris Adams, VP of
marketing for the consumer division at C - Cube Microsystems. "People want to be on
their couch and I don't think that the PC was designed for the couch environment. It
doesn't make sense to have it there instead of a TV and that is the major obstacle that
the PC/DTV faces."
Over at ASIC house VLSI Technology, the company is working closely with a number
of customers to generate set-tops targeted at the home market. However, VLSI is
looking at attacking the PC/DTV market as well and looking at the intellectual property
that is needed to combat this market. David Tahmassebi, director of marketing for the
consumer digital entertainment division at VLSI, questions whether the market will be
able to support and accept two differing DTV offerings: PCs and home DTVs.
"We are planning to support a wide variety of offerings because we don't know yet
what is going to be the clear cut winner," Mr. Tahmassebi said. "We think cable will be
the last to catch on so satellite and terrestrial broadcast will be the initial winner and that
plays into the hands of the PC, but in the long run we think a PC will be a PC and a TV
will be a TV."
Does Not Bode Well
All of this information does not bode well for the PC OEMs who have stepped up their
interest in the CE technology, specifically DTV. PC OEMs want to enable some sort of
PC/DTV that sits in the living room with the features of PCs and the ability to broadcast
programming. However, the numerous CE manufacturers stand in their way. Not only
do they want to keep the market share they already have gained, but also they want the
market share and revenue that comes with 60 million new TVs being sold into the U.S.
market and the billions of TVs sold worldwide.
Although datacasting, or including additional data and information services in the
broadcast programming, might be a sure winner on the PC because of its Internet and
processing capabilities, most semiconductor vendors, outside of Intel, are saying the
potential success of the PC/DTV is highly unlikely. The one dark horse here seems to
be Intel who gives the PC/DTV a fighting chance all by its lonesome. Intel wants the PC
to be run on a Pentium II processor doing most of the work with software to do the
decoding/encoding as well as the datacasting functions. Microsoft is right in tune with
Intel by integrating a WebTV platform into Windows 98. WebTV for Windows then
would help receive these broadcast signals and have the ability to surf the Internet and
generate datacasting as well.
"Put yourself in the place of the PC companies who see their business leveling off these
days, they are looking at new ways to get into new markets," said Dirk Logie, GM of
DTV product sector for the TriMedia Group at Philips Semiconductors. "We are
dealing with companies on both sides of the fence, the CE companies are salivating at
the chance to gobble up this huge market and the PC OEMs are trying to find new
markets to in essence stay afloat. Unfortunately, for the PC OEM, they have a harder
road to travel to success because the delivery system is not as attractive."
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