Sony Electronic Publishing cuts to the chase Microsoft vs. Apple: Is the journey the reward? A candid look at Multimedia PC Europe's rush to analog HDTV QuickTime debuts to cheers Ignorance is not bliss for vendors; A color, flat-panel TV in 1993 Mini Disc: The end of the tape?; I/O ÐÐÐÐÐÐÐÐÐÐÐÐÐÐПŸŸŸŸŸŸŸŸŸŸŸŸŸŸŸŸŸŸŸŸŸŸŸŸŸŸŸŸŸŸŸ ÆMDSUØSony Electronic Publishing cuts to the chase ÆMDNMØMultimedia vendors seemed to be stifling a collective yawn when Mickey Schulhof, president of Sony Software, announced the formation of Sony Electronic Publishing in late February. Nobody knew what to expect from Sony, a consumer electronics company with possibly the highest name recognition in the world after Coca-Cola. Nobody knew what to expect from Sony Software, which, as owner of Columbia Pictures and CBS Records, commands one of the largest archives of potential multimedia content in the world. And certainly nobody knew what to expect from the president of Sony Electronic Publishing, Schulhof prodigy Olaf Olafsson, a young Icelandic novelist and physicist. But on the heels of three Sony optical disc-based product introductions--the Mini Disc, Laser Library and the U.S. version of DataDiskman--the strategy of Olafsson and Sony is becoming clearer. Its bottom line? ``The consumer sets the standards.'' No one's yawning now. ÆMDSUØMicrosoft vs. Apple: Is the journey the reward? ÆMDNMØAs Apple Computer and Microsoft try to outshine each other with multi-media extensions to their individual system software offerings--Microsoft with Multimedia Windows, Apple with its nifty new QuickTime--it`s time to take the microscope to their respective strategies and examine where each company has been and where each is headed. Microsoft, with its belief that ``the PC is the center of the universe,'' is forging ahead with plans to put a Multimedia PC in every home, and a slew of multimedia titles in every CD-ROM drive. Vendors such as Tandy, making a huge investment in MPC, are sure hoping Microsoft is right. Apple, on the other hand, finds that point of view too constricting and expensive--especially considering the growing popularity of media-based products by consumer electronics companies such as Sony. So instead, Apple is spreading its bets, and speculation runs high. Will Apple license the Mac user interface and QuickTime to consumer electronics companies? ÆMDSUØA candid look at Multimedia PC ÆMDNMØVendors like Tandy are giving the MPC specification a good, hard push into the marketplace. ÆMDSUØEurope's rush to analog HDTV ÆMDNMØWho on earth would consider developing analog HDTV technology today? The EC. ÆMDSUØQuickTime debuts to cheers ÆMDNMØApple unveils impressive extensions to System 7; when it ships, it will be a powerful time-based creative tool for users. ÆMDSUØIgnorance is not bliss for vendors ÆMDNMØVendors form a muscular new marketing council for MPC. ÆMDSUØA color, flat-panel TV in 1993 ÆMDNMØComing soon: a 40-inch flat display you'll hang on the wall. ÆMDSUØMini Disc: The end of tape? ÆMDNMØAt last, Sony's new Mini Disc records and plays, too. MD's repercussions will be felt far beyond the music industry. ÆMDSUØI/O ÆMDNMØXiphias's Peter Black encourages paranoia about Microsoft's deal with Dorling Kindersley. ÆMDSUØEvents ÆMDSUØSony Software Enters the Fray ÆMDBUØConsumer giant champions new media with products and distribution ÆMDNMØFor some reason, the dance that's been going on for more than a year between companies trying to sell multimedia software without a real player and those trying to sell multimedia players without software titles reminds me of the mating ritual of penguins. In its early stages, two penguins face off and thrust their heads toward each other in a hypnotic rhythm. This goes on for so long you begin to wonder how they ever manage to propagate the species. ÆMDBOØCD-I, CDTV, MPC . . . ÆMDNMØBack and forth, right to left. They were, and are, a picture-perfect vision of an industry in stasis, trying to guess the right moment to cut to the chase without getting beaked. ÆMDBOØOne hand clapping.ÆMDNMØ Meanwhile, Sony Software announced a new Electronic Publishing Division specifically to produce interactive multimedia products. This move should have stopped the mating ritual dead in its tracks, but the various industries touched by Sony's entrance into the software business--video game, CD-ROM and traditional computer program publishers in particular--were surprisingly quiet about the ramifications of Sony Electronic Publishing. Judging by their lack of response, it was hard to believe that the world's best-known consumer electronics company, with a reputation for technical excellence, more than a few computer products and a pretty good record for anticipating pop-culture trends (not to mention owning a couple movie studios, a TV unit, a theater chain and a record label)--had just announced that it was entering the competitive fray. Sony does not engage in penguin mating dances. Unlike many technology-based companies, Sony rarely talks about its hardware products for the video game or new-media markets without also talking about the titles or software associated with them. These close corporate ties have helped Sony shape a strategy that could make it ``the'' multimedia player company of the 1990s, straddling the present chasm between the consumer electronics and personal computer industries. Its success depends on a number of variables, not the least of which is its ability to refrain from corporate hubris. The strategy itself, based largely on the motto ``The consumer sets the standards,'' is a significant departure from the approach favored by today's hardware hopefuls, which are banking on big (around $1,000 at least) up-front investments by consumers. ÆMDRVØThe Sony strategy ÆMDBOØA $2,000 software giveaway. ÆMDNMØIn late May, Sony announced a new CD-ROM product for the PC. Called ``Laser Library,'' the package includes a drive, audio headphones and more than $2,000 worth of software. Suggested retail price: $699. (The kit includes not only the interface card to install in the PC, but the screwdriver you need to open the PC case, too.) The drive is shipped with six well-known CD-ROMs such as ÆMDULØCompton's Multimedia EncyclopediaÆMDNMØ and ÆMDULØMixed-Up Mother GooseÆMDNMØ from Sierra On-Line, as well as foreign language-learning programs and manuals for the PC. Olaf Olafsson, president of Sony Electronic Publishing, says there is a simple philosophy behind the bundling deal: ``Lots of companies are developing software without any marketing channels. We have consumer channels for hardware, and we're in the process of developing a special new sales force for new media products. They need champions.'' It's said that those champions will be commandeering a dedicated distribution network for Sony's software products, though Olafsson says the network will not distribute Sony products exclusively. ÆMDBOØLeveraging the ``installed base.'' ÆMDNMØLaser Library sound quality is close to, but not quite, CD quality. And as you might expect, you can also use the player to listen to conventional audio CDs at true CD fidelity. The multimedia titles will work with computers that people already own--PC clones with CGA graphics, for example. Right now, the CD-ROM connects only to PCs, not Macintoshes. With headphones included, it doesn't require any special add-on circuitry for sound. ``We take advantage of what people already have. CD-ROM is relatively cheap now. Why make hardware more expensive for technical milestones?'' Olafsson says. So in Sony's worldview, multimedia software vendors go to market with what they've already developed. Consumers with PCs doing nothing in their closet--waiting with bated breath to join the multimedia revolution--will spend a few hundred dollars to hang a Sony CD-ROM drive off the back and get $2,000 worth of today's best-known multimedia software, ``free.'' Such a deal. ÆMDBOØCalling the price question. ÆMDNMØUnfortunately, one of the things likely to stick in a consumer's craw (at least it sticks in mine) is the apparent cost of the CD-ROM drive itself. A five-disc audio player is only $250 nowadays. Consumers, whether they own PCs or not, don't know or care about the difference between a CD player and a CD-ROM drive. Since Sony is positioning Laser Library's titles as ``free'' software, smart buyers are almost certain to call the question: why pay $700 (even $600, street price) for a CD-ROM drive? Whether the software is compelling enough to rocket people into their local discount electronics store to drop $700 is also at issue, especially in a world where naive consumers don't know how to assess the value of multimedia titles. Today they pay about $10 to $15 for an audio CD. Can Sony (or anyone else, for that matter) convince them that even though the ÆMDULØCompton'sÆMDNMØ disc doesn't look like a whole set of encyclopedias, that's what it is? Perceived value is a serious problem. I spoke to an old high school classmate last week, a Silicon Valley type with no clue about multimedia, who'd just attended his first CD-ROM Conference in San Jose. He said, ``I walked all around that place, and I couldn't for the life of me find anything I thought was interesting enough to buy.'' The answer to some of these concerns will become apparent when Sony splits the bundle into player and titles, which it intends to do at some point. But it's important to remember that even if Sony drops the price to $400, so as not to destroy its profit margins completely, that's still more expensive than Tandy's new drive, which lists at $399. These are interesting points to ponder. ÆMDBUØWhatÆMDBOØ Multimedia PC? ÆMDNMØThough Sony's idea for retrofitting existing PCs does require adding a CD-ROM drive, it is different in spirit from that of the Multimedia PCs (MPCs) now hitting the streets (see related story on page 17). MPC upgrades require both additional hardware (a sound board and CD-ROM drive) and software (Microsoft's multimedia extensions to Windows), and cost just under $1,000 with no software. Because he believes ``consumers set the standards,'' Olafsson has a wait-and-see philosophy about whether Sony will publish software for the MPCs. But it's clear he's not enamored of Microsoft and is skeptical of the MPC as competition. ``Microsoft makes people pay its market development costs, dictates the hardware specs, dictates what the consumer wants and dictates the price point to enjoy it. The level of dictation may be too high,'' he says. ``It's the consumer hardware and software companies who are making the investment. Not everybody can afford a $3,000 PC, and when there's a new technology like [multimedia], I don't think that it's polite to tell people that the PCs they already bought can't do it,'' Olafsson adds. ``If people want to [upgrade to the MPC], it's okay. But we'll take advantage of what they have.'' ÆMDBOØThe Diskman cometh. ÆMDNMØThe mirror reflection of this problem is the DataDiskman, just introduced in the U.S. at last week's Consumer Electronics Show. Another part of Sony's home media puzzle, it's devoted mostly at this point to portable information delivery and retrieval. Not yet capable of handling much in the way of digital media (and completely incompatible with any existing CD format, don't forget), the Diskman is not a contender in the short term as a multimedia player. Though it can play audio CDs, the DataDiskman information titles cannot incorporate other media, not even sound. Sony's market researchers say a typical customer for new Sony products is a 35-year-old professional white male making $50,000 to $60,000 per year. But Olafsson believes the DataDiskman has a far broader appeal, that a growing number of today's Sony customers are women who are more education-and information-oriented. ``Women will also buy DataDiskman products for their children, to have a portable library,'' he says. ``It's information with consumer appeal.'' ÆMDBOØSixteen bits of hope. ÆMDNMØIt is no secret that Sony is working closely with Nintendo on CD-ROM hardware to hook up with Nintendo's new 16-bit game machine, the Nintendo Entertainment System. A similar strategy has been announced by both Sega and NEC Technologies, which has adapted its own CD-ROM drive to its 16-bit TurboGrafx game machine (see a related news story on page 16). If Nintendo remains market leader, Sony hopes the combo will be the jumping-off point for a true multimedia machine in the home. Video games are a natural repository for Sony's connections into the film, video and music archives of Sony Software. Already today, Olafsson says, when a property becomes available, executives meet and discuss three or four different ways they might repackage and resell it as software. Though the game machine/CD-ROM strategy is one of the most hopeful for driving an entertainment player standard, it is also one of the riskiest. As Nintendo prepares to launch its 16-bit player, parents are starting to ask the question, ``Why should I spend another X-hundred dollars on another game system?'' And despite youngsters' fairly steady level of interest in video games over the past few years, the market for 16-bit game machines is definitely unproven. ÆMDBOØHot-wiring the home. ÆMDNMØIn any case, it is almost impossible to conceive that Nintendo can convince another 30 million customers to replace their present Nintendo units with the new 16-bit machines, and Sony's new CD-ROM drive does not connect with Nintendo's 30 million 8-bit machines. This is not a trivial concern. It should be giving not just Sony, but all consumer electronics vendors pause before they introduce new, incompatible hardware products into the cyclical video game market--especially if they're hoping to hot-wire them into multimedia entertainment centers. It's very likely that any combination of game machine and CD-ROM drive is going to have to provide value in more genres than entertainment. Moreover, unless Sony can convince Nintendo to undergo a sea change regarding the way it displays graphics on its machines (it uses a primitive tile graphics display, good for keeping hardware cheap but very limiting and difficult to develop for), Sony is likely to find that its grand plans to repackage its massive stores of entertainment content--movies, videos, music--will be hard to fulfill. ÆMDBOØWhither CD-I for Sony? ÆMDNMØConsumer appeal is certainly the question of the hour for Philips and its Compact Disc-Interactive (CD-I) devotees. Sony has a long history of collaboration with Philips on optical disc technology and standards, including an early commitment to CD-I. In fact, it is readying a CD-I player for market. Philips and the software publishers it is wooing continue to perform the penguin mating ritual, which puts Sony in an awkward position. Listening to the shouting matches between Philips and other hardware and software factions at multimedia conferences makes it clear that despite Philips's massive PR effort, the industry is not prepared to embrace CD-I, market-unseen. Though not wanting to look as if it's undercutting a partner, Sony is obviously among those waiting to see if a CD-I market materializes. Olafsson believes that ÆMDULØif ÆMDNMØCD-I is a success, it will most likely hit pay dirt in business and education, rather in than the consumer market. If CD-I looks as if it might make a dent in the marketplace, he promises Sony Electronic Publishing will be ready with titles to sell. ``We haven't limited our internal creativity in regards to other platforms or formats," he says. ÆMDBOØMuddying the waters. ÆMDNMØSo that's Sony's strategy in a nutshell. Become the information and education multimedia player-and-titles publisher on the PC by enticing owners to hang a CD-ROM drive off the back of their dusty, closeted computers. Bring another (proprietary) platform, the DataDiskman, into the U.S. market to deliver information and educational products to the home. Grab yourself a CD-ROM port on the back of a Nintendo machine and become the multimedia player-and-titles publisher in the interactive entertainment and video game business. Hedge your bets on CD-I and MPC. Clearly throw your weight behind your new Mini Disc (MD) read-write optical disc technology, extensions to the MPEG video compression standard, and a new high-density CD format. Then work hard and fast with companies like JVC and Matsushita on distributing digital movies. Last but not least, start your own distribution network to ``champion'' new media products. ÆMDBOØHierarchy of needs. ÆMDNMØBut there are some fundamentals Sony must heed to achieve media supremacy:  The titles community is in a snit about a rampant rumor that Sony is going to close its dedicated distribution channels for interactive media to anyone but its own sweet self. Olafsson is adamant that this is not true; he says Sony will definitely use its channels to distribute product from other publishers. Let's hope Sony continues to resist temptation. Though initially such a move might seem like a good way to jump-start a new industry, it is more likely that the converse is true. If a thousand companies are making and distributing new-media products, a diverse and lively market is born. Not to mention that by doing so, Sony can make some money off its competitors, too. Not a bad deal for all concerned.  With so many incompatible optical disc formats on the market--at least two of them (MD and DataDiskman) sold right now by Sony--it's vital that Sony start a developer relations (ÆMDULØi.e.,ÆMDNMØ ``evangelism'') program. Sony cannot afford to alienate third-party developers by being secretive about new hardware plans. (As a matter of fact, it might be nice if Sony even came up with a cross-platform authoring system.) Microsoft's System Software vs. Applications Developers Dilemma is in effect here--Sony's Electronic Publishing people haven't quite figured out whether or not they're competing with third parties. The answer is, ``Yes, you are. And that's a good thing.''  Sony also needs not to be piggy about licensing content. It does own a lot of creative properties, which does provide it with competitive advantage--ÆMDULØi.e.ÆMDNMØ, first crack at turning music, videos and film into multimedia--and it has good relationships with people who know how to create it. In the same way Sony can collect royalties from competing publishers by distributing their products, it can create another a tidy business from licensing content to them.  Sony must move beyond the entertainment thing. Education and information will be giant consumer products for new media in the future. Despite Sony's expertise in consumer/entertainment hardware and its holdings in creative content, attention directed toward useful, less volatile products will yield greatly in time. Luckily, Olafsson believes that both Laser Library and the DataDiskman, and probably CD-I as well, fall into this category. Still, there are a lot of information and education titles out there waiting to be created, and it would be helpful if he were to start cultivating independent developers now who are good and who want to do this kind of software.  Probably most important, Sony must find and develop expertise in interactive software design. This is not the time to rely on people whose experience is text-based CD-ROM products--or for that matter, on film producers. There are lots of people in the business who know lots about making interactive products, and with the shape of the economy, they're probably about to be laid off, so they're around. If I were Olafsson, I'd get an AppleLink account right away and post my address. ÆMDBOØNo more mating rituals. ÆMDNMØSony Electronic Publishing is in a powerful position, and Olafsson holds a great deal of power over the future of new media software. But he does not have an easy row to hoe. One developer put it rather succinctly: ``I think it's going to be difficult for him. In one way, I'm just amazed at what he's created, but that comes with its own overhead and expectations.'' For some reason, those expectations always seem to center on a kind of benevolent-dictator fantasy, that the industry's vastly powerful corporations--Sony, Microsoft, IBM, HBO, Disney--will use their power to do precisely the right thing for everyone involved. This is, of course, impossible. And in a world where these companies are engaged in a life-or-death battle for market supremacy, the most anyone should really hope for is to not get beaked during mating season. Sony appears to have gone much farther than that, though, by using existing hardware as a platform for multimedia software, by opening its distribution channels and by encouraging the growth of the titles business. Though he knows Sony's strategy isn't necessarily perfect, Olafsson's first priority is to get some multimedia products on consumer shelves now, not wait for just the right platform and software. No more mating rituals. ``The idea is to do a little now and something fantastic later,'' he says. ``You can't buy creativity, but nobody likes to work in an operation that loses money, not creative or business people.'' ÆMDULDenise CarusoØ ÆMDSUØMicrosoft, Apple And the Myth Of Multimedia Computing ÆMDNMØMicrosoft and Apple Computer are the architects of the two principal personal computing environments. They are also the companies most responsible for creating and refining the concept of ``multimedia computing.'' Both companies have been pro-active ``visionaries.'' For the past five years or more, they have worked to define technology and to create markets. They have operated almost completely independently of each other, each following its own muse. Both companies have learned from their experiences, adjusted strategies and questioned initial assumptions--and both continue to do so. Their strategies have never been completely in synch, but they have never been so divergent as they are now. With some minor adjustments, Microsoft is resolutely plowing the course it set for itself some time ago. The ``new'' Apple has re-thought its direction and is now headed in a direction that has profound implications for the future of the personal computer industry. At the heart of the division is the question of whether computers and consumer electronics will remain separate--and increasingly competitive--industries, or whether they will become cooperative and symbiotic. A more fundamental question is whether any of this technology is good enough yet to provide a compelling experience at a price consumers are willing to pay. ÆMDSUØMicrosoft: PCs as center of universe ÆMDNMØBill Gates has long had the goal of ``a computer in every home and on every desk.'' From the beginning, he has seized on the compact disc-based CD-ROM as the catalyst to make this dream come true. The campaign started with a focus on CD-ROM drives as the ``new papyrus'' for publishing information, and has added, over time, increasing emphasis on including images, sound and (eventually) motion images as well. Through all of this, the central objective has been to strengthen the appeal of the personal computer for the crucial home market--to turn the computer itself into a consumer product, as necessary and desirable to any home as the television set. ÆMDBOØThe consumer electronics challenge. ÆMDNMØMicrosoft's most dangerous potential competitor in this field is not Apple Computer, but the consumer electronics giants. The real battle, from Microsoft's point of view, is over whether the home multimedia box will be a computer (which runs Microsoft system software) or a consumer electronics device. The most direct threat over the past few years has been the Philips/Sony Compact Disc-Interactive (CD-I) project--an effort that now has at least some level of backing from most of the Japanese consumer electronics manufacturers and from publisher Robert Maxwell in the European market. The CD-I consortium has promised a player that connects to the home TV set. The player (which will also play conventional audio CDs) will retail for under the magic $1,000 price. After several years of ``wait 'til next year'' promises, CD-I players are now promised for late this year. In the meantime, Commodore has tried to steal CD-I's thunder with CDTV (Commodore Dynamic Total Vision)--a remarkably similar product based on a repackaged Commodore Amiga computer but like CD-I, clearly presented as a consumer electronics product rather than as a home computer. Thus far, for a variety of reasons, there is little evidence of enthusiasm in the U.S. for either CD-I or CDTV. CD-I is taken much more seriously in Europe (where the all-out backing of Philips means a lot) and in Japan (where technical novelty sells). Commodore, as well, has much better name recognition and a strong market base in Europe, especially the UK and Germany. ÆMDRVØThe Multimedia PC ÆMDNMØAs CDTV clearly indicates, the distinction between a computer and a consumer electronics box can become very arbitrary indeed. No one doubts that there is a great deal of overlap between the home, education and business/training markets which Philips covets with CD-I and the similar markets Microsoft hopes to create for the Multimedia PC. Each side thinks the long-term potential is far too large to cede it uncontested to the other. ÆMDBOØStandard configuration. ÆMDNMØOver the past five years, Microsoft has worked diligently to create a standard, CD-ROM-based personal computer that can lead the PC forces in this battle. The first step was to agree on CD media standards for recording something other than music on CD-ROMs. Microsoft has worked with Philips, other consumer electronics companies and computer vendors to define format standards for CD-ROM. These have been codified in a series of color-coded (red, green and yellow) books published by Philips. Everyone except for Apple adheres to these standards. ÆMDBOØRetrofitting a multimedia computer. ÆMDNMØBut the biggest challenge for Microsoft has been retrofitting multimedia capabilities to the PC, a computer originally designed to process ASCII text. It is therefore at a considerable disadvantage compared to Apple when it comes to creating a multimedia PC. Apple starts with a huge lead: computer hardware and software that is far more graphic to begin with and that already has some sound capabilities. Even more important, Apple has essentially a single hardware/software standard, and Apple has complete control over that standard. Conversely, the PC world has revelled in its diversity: there are so many possible permutations of monitors, peripherals, interfaces and add-in cards, it is not difficult for someone to construct a PC that is truly unique. Because of this diversity of hardware, the only way Microsoft can move the PC standard forward is by coercion or persuasion. ÆMDBOØThe game plan. ÆMDNMØIt was pretty clear what Microsoft needed to do. First, it needed to establish a platform for multimedia computing--a minimum standard hardware/software configuration that both developers and users could count on. Second, it had to decide upon a lowest common denominator to make the platform attractive to developers. If consumer electronics companies were promising a $1,000 home TV-to-multimedia playback upgrade, Microsoft saw it would have to encourage a similarly priced upgrade that could leverage a large installed base. The multimedia PC everyone would like to see--a '386 machine with lots of memory, a high-resolution 24-bit color display, and the ability to play back digitally compressed full motion video--costs too much even for most businesses to consider. As a result, Microsoft was forced to focus its attention on defining a minimum ``upgradable'' '286 configuration (some 15 million PCs with at least a 10-MHz `286 chip and VGA-level graphics are installed today) that supports entry-level multimedia capabilities. (See Microsoft/Tandy Multimedia PC story on the facing page.) With the advent of MPC, Microsoft finally has most of the system hardware and software pieces in place to mount an effort to create a home/school multimedia PC. market. It clearly wants to do this before the CD-I marketing blitz hits. ÆMDBOØBut is it good enough? ÆMDNMØWe are skeptical. As indicated above, the MPC specification has been constrained by the need to promise that all of those '286 PCs already sitting in homes and schools can be upgraded--inexpensively, of course--to MPC specifications. Thus, if we are to accept Microsoft's specs at face value, the base MPC is a relatively slow computer with modest amounts of memory, a 4-bit (16-color) color monitor, limited audio capabilities, and no built-in support for digitizing video. This level of machine is a sluggish performer, even running Windows without any multimedia capability. To prove the point, most of the multimedia demos we have seen have run on fast '386 or even '486 machines, the type of MPC we're sure will dominate the market. But we are willing to be convinced. A few demos of a few multimedia titles ÆMDULØdoÆMDNMØ perform reasonably well on a '286 machine--even to the extent of displaying several-frame-per-second ``video'' in a small window on the screen. However, there is a very substantial risk that customers accustomed to television and Nintendo-type interaction will not be seduced by MPC titles. The trick, for MPC as for CD-I and CDTV, is going to be to work within the limits of the technology to develop titles that have real charm and appeal. Quite frankly, we have not yet seen anything to convince us that our friends and neighbors are going to want to rush out and buy MPC, CD-I or CDTV--ÆMDULØany ÆMDNMØof the first-generation multimedia boxes. ÆMDBOØTitles, titles, titles. ÆMDNMØWhat is going to convince them is compelling content. It has almost become a platitude that without titles, any new platform cannot be successful. With a new ``art form'' like interactive multimedia, the problem is much greater. Software development costs can be quite high. The market is unknown and unproven, and we have not yet begun to develop an aesthetic. Microsoft is actively campaigning to accelerate the learning process. Besides the annual CD-ROM Conference, it now holds another annual conference for prospective multimedia developers and has just announced the MPC Marketing Council (see story on page 17). It sells an inexpensive yet powerful authoring system as part of its software development kit. And it is also courting print publishers to get involved now and support computer-based multimedia delivery, rather than the consumer electronics products. ÆMDBOØDorling Kindersley.ÆMDNMØ As part of this effort, Microsoft has taken the controversial step of investing in a print publisher and arranging for that publisher to produce MPC titles. It has purchased a 26 percent interest (which Microsoft's Darby Williams says translates to $26 million) in the British publisher Dorling Kindersley Ltd. DK, in turn, has announced its intent to conceive, develop and publish future titles as parallel print and MPC products. DK is an ideal partner for Microsoft in this sort of venture. It has done a brilliant job of pioneering highly visual print titles such as ÆMDULØThe Way Things WorkÆMDNMØ by David Macaulay, ÆMDULØThe AMA Encyclopedia of MedicineÆMDNMØ, and Penelope Leach's ÆMDULØYour Baby and ChildÆMDNMØ. It has amassed a vast library of images, and already makes extensive use of computers (Macintoshes). It publishes most of its titles in some 20 languages. If any print publisher can learn how to exploit interactive text and graphic computer presentation of information, it should be DK. As Peter Black argues in our I/O column this month, the DK deal does not please everyone. Some publishers say they are pleased that Microsoft is putting its money where its mouth is. Others are alarmed that Microsoft is moving into publishing. Still others are concerned that, like the Sony acquisition of CBS Records and Columbia Pictures and the Matsushita acquisition of MCA, this is yet another example of a ``platform'' supplier moving to corner rights to content--content that could serve as a competitive advantage in making its platform successful at the expense of others. ÆMDBOØToo little, too soon? ÆMDNMØPerhaps Dorling Kindersley or someone else will come up with titles so compelling that we will change our minds. Perhaps Tandy will be able to convince large numbers of consumers that a Multimedia PC is just what they wanted (but did not know it). But, frankly, we just do not see MPC, CD-I or CDTV as the next hot consumer product. From Microsoft's standpoint, this would not be the end of the world. Aside from the $26 million investment in DK, a significant portion of which is specifically for the purchase of electronics rights to DK's properties, cash-rich Microsoft is not taking a risk on either the hardware or on most of the software titles. It will certainly benefit if MPC is successful, but will not perish if it is not. The risk Microsoft cannot afford to take would be to have CD-I be successful uncontested. If, as we suspect, neither CD-I nor MPC lights a spark, both sides will surely use the experience they have gained to prepare for the next-generation battle. But there is another, even greater risk that Microsoft does not appear to have focused on: Suppose the competition is not really CD-I or CDTV. Suppose it comes instead from the next-generation versions of products such as Sony's DataDiskman or NEC's TurboGrafx games? This scenario appears to be what has riveted Apple's attention. ÆMDSUØApple: If you can't beat them, join them ÆMDNMØApple already has much of what Microsoft has been striving to create. The Macintosh has been a much more graphic machine than the PC from the start. It provides a relatively consistent graphic environment from low-to high-end machines. It has always included at least basic-level support for sound. And, it includes standard interface hardware and software for all peripherals (including CD-ROM drives). As a result, while the PC industry has led in CD-ROM-based text retrieval applications (which is, do not forget, where most CD-ROM sales have been thus far), the Macintosh has been the platform for multimedia computing applications. ÆMDRVØWhy hasn't this taken off? ÆMDNMØApple feels that enough work has been done thus far to demonstrate that multimedia computing can provide a compelling experience for the user. Yet sales of multimedia peripherals and titles have been disappointing. Why? Apple believes that there are two problems: 1. The platforms required are still too expensive and too complex. People are not going to buy even a Macintosh Classic, CD-ROM drive and speakers just to be able to play back multimedia titles. 2. There are no real standards for creating multimedia titles. Apple's HyperCard is not a cross-platform standard. Despite Macromind's efforts to make it so, neither is Director. No one developing titles has any assurance that the titles he or she develops today will be able to play on the next generation of multimedia players. ÆMDRVØThe fusion of computing and consumer electronics ÆMDNMØMicrosoft has focused on creating a PC-based multimedia player as a means of getting PCs (which presumably will be used for other purposes as well) into people's homes. Apple no longer believes that this is the only solution. It believes one thing that will really open up the market will be inexpensive play-only machines--preferably portable ones--which are, by definition, consumer electronic devices. Apple now thinks that for the personal computer and consumer electronics industries to battle each other for the same market is a lose-lose situation. It is quite possible that neither will be successful. The win-win approach is for the two industries to cooperate. In Apple's new view, multimedia players are consumer electronics products and Microsoft-style player/computers are computer industry products, as are create/play/compute machines. To be successful, you will need all three--and they will have to be compatible. ÆMDBOØCreative tools. ÆMDNMØIn keeping with its ``creative user'' heritage, Apple has always placed more emphasis than Microsoft on providing its users with the ability to use a rich media ``vocabulary'' (including sound and motion video) to communicate information. This clearly extends to providing tools for creating multimedia presentations as well as playing them back. By contrast, one of the most glaring weaknesses of consumer electronics products to date has been their woeful lack of good tools for creating content. This industry has always assumed that titles are created in large studios with access to all kinds of expensive equipment---not by an individual or small work group who has a message to communicate. There is an obvious synergy. The consumer electronics industry can provide the mass-market player the computer industry lacks. The computer industry can provide the creative tools that empower hundreds of thousands of people to create content for these players. ÆMDBOØCommon standards. ÆMDNMØFor this to work, there will have to be common standards. These must be far more than the ``Red Book,'' ``Green Book,'' ``Yellow Book'' specifications for CD data formats (which the old, ``proprietary'' Apple preferred to ignore). They must include system architecture, media, data, user interface, and software standards.ÆMDBOØ ÆMDBOØ``Open Apple.''ÆMDNMØ Until recently, Apple's approach has been to regard its core technology (forgive the pun) as a precious competitive advantage. Things have changed. Apple missed its window to significantly increase its market share in the personal computer industry in 1986-1990. It now appears to realize--given its share of the personal computing industry--that to be too proprietary is to be a niche player, increasingly isolated from the mainstream. It has signaled its willingness to open up and share its technology--at least that portion that will help in forming competitive alliances with the consumer electronics giants. We expect Apple to try both to license Apple technology to these companies and to cooperate with them on the development of common standards. Prime candidates for such licensing would include the Macintosh user interface and Apple's new QuickTime language for controlling time-dependent events such as audio and video. (See QuickTime story on page 14.) ÆMDBOØSignals from Sony.ÆMDNMØ At least one consumer electronics giant appears to be receptive to this approach. (See ``Sony Software Enters the Fray,'' page 1.) In his annual speech to the Microsoft CD-ROM Conference this March, Sony's Toshi Doi seemed to distance himself from both the Microsoft MPC standard and CD-I. What we have now, he said, are two different camps: computer industry products and consumer electronics products. To be successful, we will need new standards that embrace both industries. Doi, the ``father'' of the compact disc and currently the Sony board member responsible for the company's computer and workstation products, does not necessarily speak for all of Sony--let alone all of the Japanese consumer electronics industry. Nevertheless, Doi's speech could have been scripted by Apple (or vice versa). ÆMD0ØMedia independence. ÆMDNMØInterestingly, Apple's ``alliance'' strategy is much less CD-ROM-centric than is Microsoft's ``PC in every home'' strategy. The reason is simple: Compact disc and other mass-market media formats are determined not by the computer industry but by the consumer electronics industry. Although Microsoft can work with these companies to help establish standards for new CD data types, Microsoft has no power to change the overall form factor and format. But Sony, Matsushita, JVC and their brothers do. The current CD standard was designed more than a decade ago to accommodate 74 minutes of digital high-fidelity audio. It could be supplanted by new formats that are more compact and/or that are more suited for storage of compressed digital video. Apple believes that the system architecture and data standards should be media-independent and should not presume any particular data compression, data storage or data transmission technology. ÆMDRVØA long time coming ÆMDNMØIt is not yet clear how Apple's new grand strategy is going to play out. However, it appears to us that Apple has come to two conclusions:  Based on its own experience to date, Apple no longer has confidence that a PC-centric strategy (such as the one Microsoft is embarked on) is going to fulfill what it believes is the ultimate promise of multimedia.  The collision between computing and consumer electronics is real. It is smarter for Apple to embrace it than to deny it. So, Apple, finding itself outgunned in the PC industry, is mounting what amounts to a Desert Storm-type flanking movement around the Microsoft trenches, sweeping into the home market with a flying wedge of consumer electronics products. The potential win for Apple may not be as large as would be the win for Microsoft if it were able to realize Bill Gates' vision of a PC in every pot. However, if we were in Apple's position, we would be doing exactly what we believe Apple is trying to do. This is the first time in five years we have been able to say that. ÆMDULØJonathan Seybold News ÆMDSUØEurope's rush to analog HDTV ÆMDBUØWhy on earth, when the world is going digital? ÆMDNMØThe Japanese consumer electronics companies are rushing toward delivery of broadcast-quality video on new-generation compact discs. Several companies are proposing their own compressed digital formats for direct satellite broadcast in the U.S. The cable industry is abuzz over the prospect of delivering compressed digital broadcasts and entertainment over coaxial or fiber-optic lines. Four of the five outstanding proposals for an American high-definition television (HDTV) standard are either all-digital or hybrid analog/digital. Surely, the Europeans must be rethinking their own analog HDTV standard. They cannot possibly want the European market and European products and services to be left behind the rest of the world. Sorry! The European Commission, true to its heritage of making Politically Correct decisions, appears determined to push ahead with what it's calling HDMAC, the European high-definition standard, as rapidly as possible. On June 3, the Commission was to present to the Common Market telecommunications ministers a draft directive for implementing HDMAC. The draft is a product of several months of negotiations on how to implement analog HD without serious discomfort to any of the principal affected parties. There does not appear to have been serious consideration of scrapping HDMAC and going directly to a digital standard. We understand that the draft will set HDMAC as the new European television standard, replacing the current PAL (Phase Alternate Lines) standard. European television manufacturers, broadcasters, satellite operators and cable companies are expected to agree to form a consortium to promote the introduction and adoption of European wide-screen, high-definition television. To smooth the transition, the Commission (on behalf of European tax-payers) has reportedly agreed to subsidize satellite operators for simulcasting programs in both PAL and HDMAC formats, and to subsidize broadcasting companies for converting old movies and program content to high-definition format. ÆMDBOØGood thinking! ÆMDNMØWhy in the world is this happening? The overriding motivation appears to be to beat the rest of the world to HD and to create a new consumer market for Philips and Thomson. The Commission's plan will cost the European taxpayers billions of dollars per year in subsidies, and it will probably prevent them from realizing the benefits of digital delivery, on-demand video and interactive TV that their American counterparts could get. Ironically, it may actually do the European consumer electronics industry more harm than good. It is ludicrous to push analog technology in Europe when even Philips is part of the consortium working on digital HD in the U.S. There is nothing (except for protective European quotas) that will prevent the Japanese consumer electronics companies from making televisions to the European standard and selling them in Europe. And the European manufacturers, with their attention focused on HDMAC analog HD, will most likely miss out on the ultimate shift to digital, which will happen in the rest of the world. ÆMDSUØPacBell's loss is big gain for Raynet ÆMDBUØNew VPs commit to fiber network and services ÆMDNMØWithin the past two months, Raynet Corp. of Menlo Park, California, has cherry-picked two savvy technologists from high atop the corporate tree at Pacific Bell to spur the installation of fiber-optic phone lines into the home. Michael Bandler, former PacBell vice president of network technology, and Thomas Edrington, PacBell's assistant vice president of science and technology, have joined Raynet in executive positions created especially for them. Raynet, a subsidiary of Raychem Corp., is offering ``fiber in the loop'' systems at a price close to that of existing copper systems and is committed to becoming a major supplier of fiber-optic connections to public network companies. (``Fiber in the loop,'' or FITL, is the fiber connection from a phone company's central office into individual homes and businesses.) By snagging Edrington and Bandler, both of whom are vocal advocates for modernizing the public network, Raynet is hoping to convince telephone companies nationwide to install fiber-optic telephone systems into residences and small businesses some time before the end of the millennium. ÆMDBOØDiplomacy vs. warfare. ÆMDNMØBandler, Raynet's new executive VP, is a 30-year phone company veteran and corporate officer; he'd served as VP of network technology at Pacific Bell since 1982. He's already busy lobbying the Bell companies to get off the dime and install fiber in the loop, and persuading politicos to take regulatory action toward smoothing their path. ``We want them to install it now,'' says Bandler. Edrington's job is trench warfare to Bandler's diplomacy. As VP of customer service, he has to wrestle with customers who must be convinced of the absolute reliability of a fiber phone network. But his ability to convince them of its utility may prove equally vital. A 24-year telecom veteran, Ed-rington established the first research and development group within Pacific Bell. Before he left for Raynet, he was director of all technology labs at PacBell. One was the Advanced Communications Laboratory (ACL) in San Ramon, California, site of many experimental fiber-based services created and tested by Edrington's staff. ÆMDBOØA dial-up library. ÆMDNMØOne of the home applications being tested in ACL was ``LiberNet,'' a dial-up ``library of the future'' with fully integrated media capabilities, including full-motion video, sound and language translation, and fiber transmission of high-definition television (HDTV). Another mind-boggler was a network application on two Sun workstations in different buildings connected via a fiber link. A demonstration showed the workstations simultaneously running a financial application while displaying full-motion video, stills and text. At the same time, a live video link was left open between the two workstations without degrading the network's operation. The two users could share an active, internal screen--the much-ballyhooed ``electronic whiteboard''--which both could use to display and manipulate data in real time. ``My bet is within three or four years, the way bandwidth is going, this technology will yield some very useful applications,'' predicted Edrington. ÆMDBOØNow ÆMDBUØthat's ÆMDBOØbroadband.ÆMDNMØ Most people understand that fiber is the perfect delivery vehicle for future media-intensive home applications such as interactive TV, dial-up video and audio, ``virtual reality,'' multiple-player video games and online information services because of its enormous capacity and speed. But few people appreciate how much bandwidth fiber really provides. Light moving down an optical fiber was last clocked in the labs at 40 billion bits per second, but the theoretical limit is believed to be in the trillions-per-second range. For perspective: an uncompressed HDTV signal moves at a comparatively puny 100 million bits per second. A math calculation or two makes it obvious that the capac-ity of an optical fiber phone line is limited only by the robustness of the electronics--ÆMDULØi.e.ÆMDNMØ, the switches and splitters that pump and route the signals--on either end of the connection. ÆMDBOØAttitude problem. ÆMDNMØMost long-distance lines and switching centers nationwide are already wired with fiber, and many large corporations are setting up private, fiber-based phone networks. But federal regulations on the cost of telephone services and legal restrictions from the divestiture of the Bell System in 1982 have stymied the installation of fiber to residences. A significant, related factor is that 70 percent of the physical connections provided by phone companies--ÆMDULØi.e.ÆMDNMØ, the ``loop'' into houses and small businesses--account for only 30 percent of their revenue. Telcos say this doesn't give them sufficient financial incentive to take on the massive job of replacing copper with fiber--unless, of course, they are allowed also to sell the services they transmit over fiber, presently forbidden by the Justice Department's 1982 divestiture ruling. An overview of the attitudinal, competitive and regulatory roadblocks to deploying a fiber infrastructure is a subject for another issue of this newsletter. But for now, just as the consumer electronics industry is based on the ÆMDULØde facto ÆMDNMØceiling of ``no gadget more than $1,000,'' the telephone industry will not install fiber nationwide until fiber is at least as cheap as existing copper-wire systems, and until it is convinced there is money to be made on billable services to fill fiber's enormous bandwidth. ÆMDULØDenise Caruso ÆMDSUØQuickTime package debuts ÆMDBUØApple plays the pioneer again; an impressive coup ÆMDNMØApple chairman John Sculley has said that Apple laid the foundation for desktop publishing in 1984 and 1985 by ignoring computer industry standards and charting its own course. Now Apple is about to ``play pioneer'' again, says Sculley, and set down the necessary foundation for multimedia desktop computing. The centerpiece of this effort will be QuickTime, Apple's system software extensions for controlling time-dependent, or ``dynamic,'' media. Apple formally introduced QuickTime to the public at a press conference held in conjunction with the Digital World Conference this week. ÆMDBOØA complete package. ÆMDNMØThe full QuickTime package includes extensions to the Apple system software as well as a new file format standard, compression routines and, equally important, user interface standards and guidelines. QuickTime will be able to run on any Mac with at least a 68020 processor and 2 MB of memory. It can run transparently on any display, 1 to 24 bits deep, because it can enable the image to simulate more colors or shades of gray than might be available. The only Macs it will not run on are the original ``compact'' Macs (Mac Plus, SE and Classic), although 68000 support is a key goal. ÆMDBOØMacintosh ``movies.''ÆMDNMØ The new QuickTime data file format, called ``movie,'' is Apple's first major new format since it created the PICT format for graphic images in the early days of the Mac. Unlike previous Apple file formats, it is intended to be a ÆMDULØde facto ÆMDNMØcross-platform, multimedia standard; Apple is publishing the file specification. The term ``movie'' is a little misleading, however, since a Macintosh movie does not have to include video or animation, and it does not have to be played from beginning to end in a linear fashion. Think of it instead as a collection of coordinated tracks--say, for example, a video track, three different audio tracks, an animation track and a text track, all available in concert with each other. Each track may have its own time base: audio sample rate or SMPTE video time code, for example. Under the covers, QuickTime automatically converts all external time bases to increments of microseconds (QuickTime's internal time base). It thus has no trouble keeping different tracks expressed in different time bases in synch with each other. Third-party developers can also register additional track ``types'' with Apple. Some of the earliest examples of these types will include interactivity tracks (such as Macromind's Lingo), closed-caption text, numeric data tracks and MIDI (Musical Instrument Digital Interface) data. The addition of an interactivity track, for example, will allow the movie to pause at specific events and branch to different tracks and/or different locations. ÆMDBOØSystem extensions. ÆMDNMØSystem extensions for QuickTime include major enhancements and additions, and they provide new facilities and services to support the new data types. These extensions have been designed for Apple's new System 7.0, but they are backward compatible to version 6.0.7. New QuickTime-friendly applications can use them to support the new data type. The facilities include the timing mechanism mentioned above; extensions to the Macintosh Sound Manager, which support the interleaving of data with sound from external sources, such as an audio CD, and can enhance the audio quality available on the Mac; and the ÆMDULØMovie ToolboxÆMDNMØ, a collection of interface functions that allow the user to interact with (store, retrieve, manipulate, etc.) any of the tracks that make up a movie. The extensions also include two internal data ``managers.'' Component Manager registers additional media devices attached to the computer, such as digitizer cards, and informs the system how to access the device and what it can do. Image Compression Manager allows the user to create and manage a variety of software modules for compressing and decompressing data. ÆMDBOØIncredibly easy for users. ÆMDNMØApple has done a good job of keeping QuickTime ``open'' to the rapid pace of innovation in media hardware and software. It is relatively easy for someone with a new hardware device or a new image compression/decompression scheme to supply software modules which plug into QuickTime. It is incredibly easy for the user to add these modules to his system. ÆMDBOØApple compression.ÆMDNMØ Apple has supplied its own starter set of compression and decompression modules, insuring basic functionality across the product line. Included are a JPEG-compatible still-image routine; two animation compression schemes (one ``lossless,'' the other ``lossy'' but capable of compressing the movie at ratios of up to 500:1); and a video compression module. The emerging MPEG video compression algorithm requires too much processing power to run in software on current Macintoshes. So, Apple has provided its own algorithm that allows the base-level machine to display motion video in a 160x120-pixel screen window at an average rate of 12-15 frames per second with synced audio. Like most video compression routines, the Apple module relies on frame-to-frame continuity. However, it is also capable of compressing individual frames. Apple's routines can compress video up to approximately 12:1 every frame, or 25:1 with frame-to-frame. ÆMDBOØHow good does it have to be? ÆMDNMØApple's intention was to provide at least some level of software-only video record-and-playback capability for all capable Macs. If you want to drive a full 640x480-pixel video window with all the color data and 30-frame-per-second playback, you will have a number of third-party accelerator boards from which to choose. While we would not want to use it to view ÆMDULØLawrence of Arabia, ÆMDNMØwe have found the little video window to be very useful and, even more important, very engaging. Like the video displayed on those little LCD personal TVs, it is good for head shots and simple action sequences (but nearly useless for anything too detailed). Even this base-level Apple video will be appropriate for information training and education applications as well as role-playing games and some other forms of entertainment. The most important thing is that software developers will be able to count on the fact that every machine above the Classic will be able to play back at least some video. This access to video adds a level of communication and involvement that simply is not possible without it. ÆMDBOØ``Cut and paste'' audio and video. ÆMDNMØWhat makes this even more important is that QuickTime audio and video can be added to ÆMDULØany ÆMDNMØMacintosh application. There is full clipboard and scrapbook support so that individual tracks or sections of movies can be pasted into other documents. For example, a user should be able to paste a movie into a memo he has created on his word processor, just as he might paste a PICT graphic into a text file today. QuickTime is an impressive coup for Apple. The facilities and user interface conventions are very well thought out. They give the Macintosh a substantial edge over the PC in incorporating sound and video. The base-level software video compression/decompression creates a user base that will really encourage the use of video in all manner of ``documents.'' Most of all, QuickTime is surprisingly open and extensible. This openness will encourage lots of innovation and exploration. ÆMDULØJonathan Seybold & David Baron ÆMDSUØNEC's new chip set does MPEG ÆMDBUØCompressed video with TurboGrafx, Japanese PCs ÆMDNMØA chip set that allows full-motion, full-screen video to play from a ÆMDNMØCD-ROM drive was announced and demonstrated by NEC Technologies at the Summer Consumer Electronics Show (CES) in Chicago last week. Called NID, for New Interactive Display, the chip set will allow playback of video compressed at a ratio of 100:1. It is fully compatible with the standard for compressing video developed by the Moving Pictures Experts Group (MPEG). NID is compatible with both NEC's 16-bit TurboGrafx game machines and NEC personal computers available in Japan. NEC is already the world's largest manufacturer of CD-ROM drives, and it maintains the largest base of personal computers in Japan. (Its Japanese models are incompatible with PCs sold in the U.S.) In addition, TurboGrafx is the first game machine to boast a CD-ROM add-on, an accessory that competitors Nintendo and Sega are expected to match very soon. U.S. TurboGrafx machines will need an additional buffer for the video signal and a slight adaptation of the interface, but their existing CD-ROM drives need no alterations to run NID. ÆMDBOØVideo jigsaw puzzle. ÆMDNMØTo demonstrate the NID technology, NEC's representatives at CES showed a prototype application of a video jigsaw puzzle. Each piece is part of a larger moving image that the user must put together. With the weight of NEC's reputation behind it, NID has the potential to turn both the game world and the multimedia computing world on their ears. As game machines become more and more sophisticated, there is reason to believe that they will enjoy what could be called ``home-field advantage'' in their competition against multimedia computers. Game manufacturers know how to sell to families, and they understand the value of attractive price points. While the computer industry debates formats, the game industry will be counting money. Developments such as NID show, once again, that media-driven technology is more likely to enter the home not through the home office--and its computer--but via the average consumer's taste for entertainment and games. ÆMDBOØNo compatibility yet. ÆMDNMØThe CD-ROM drive for NEC's TurboGrafx game is incompatible with its drives for PCs. The company claims that different firmware is required to optimize performance for each, despite their identical form factors. Also, market research dictates that consumers are confused when a product crosses boundaries: ``Is it a computer peripheral or a game machine?'' Those who want one are not likely to buy the other. ÆMDULØDavid Baron ÆMDSUØIgnorance is not bliss for MPC vendors ÆMDBUØMicrosoft forms Council to build awareness of MPC label and products ÆMDNMØOn June 3, in a massive, worldwide effort to promote Microsoft Corp.'s Multimedia PC (MPC) specifications, Microsoft and 10 personal computing companies including Tandy Corp., Zenith Data Systems, Philips and AT&T Corp. announced the formation of the MPC Marketing Council. ``We're not sure the industry understands multimedia, especially after seeing some of the presentations at Comdex'' last month, said Darby Williams, product manager for Microsoft's multimedia systems group. ``Most developers still don't know what it means or what to start with.'' The marketing council, founded by Microsoft, is now incorporated as a non-profit subsidiary of the Software Publishers Association (SPA). Ownership of the MPC logotype mark has also been transferred to SPA to administer. ``We want all information publishers and software publishers to build applications to MPC specs, and SPA has the best installed base,'' said Williams. ``Also, they know how to protect intellectual property rights, and that's what the mark is.'' The council's primary purpose is to encourage and support both hardware and software developers building products to Microsoft's MPC specifications. Companies pay a sliding scale to join the association based on their affiliation. A computer system company such as Tandy, for example, pays a base fee of $250,000 to join the Council and will pay an additional fee per unit sold or delivered. International hardware companies, or those providing only MPC upgrade kits such as Media Vision (Fremont, California), will pay ``far less than'' $100,000 to join, according to Williams. The last tier of membership is for software developers, who will pay less than $1,000 to join. Members' products are required to connect with Multimedia Windows program interfaces, to work with MPC computers and software, and to use at least one media element such as sound or video. Members are then entitled to use the MPC logo on their products to signify compatibility, in much the same way that the tags ``VHS'' or ``Compact Disc'' are used today. The 12-member Council board includes SPA executive director Kenneth Wasch, Williams of Microsoft, Jerry Calabrese of Philips, Julie Galliers of AT&T, Paul Jain of Media Vision and Jim Anderson of Headland Technology/Video7. The group elected as chairman Mike Grubbs, senior director of marketing for Tandy Corp. Tandy announced the first commercially available Multimedia PC in Palm Springs last month, and it has made a major corporate commitment to MPC. The initial infusion of capital from shareholders will be used for ``furthering the cause'' of MPC, Grubbs says. Ongoing revenues will come from licensing deals with members. A full-time staff member will be devoted to promote MPC and to provide education and information to the application development community. ``The MPC is an application delivery platform,'' says Grubbs. ``So we thought SPA would be a good marriage for us because its constituency benefits from [the Council] and is a driving force behind it.'' Though the SPA match may seem perfect, the Interactive Multimedia Association (IMA), formerly the Interactive Videodisc Industry Association (IVIA), is likely pouting over the selection. Many believed that IMA would be tapped for the job of administering the MPC trademark. Williams wouldn't comment on the IMA rumor. But in its IVIA incarnation, IMA was committed to both analog technology and cross-platform compatibility, neither of which is a focus for the MPC Council. But at Comdex in May, IMA announced it would be forming a compatibility steering committee, and it's said it may be starting a technical working group to help guide future versions of the MPC specification. ÆMDULØDenise Caruso ÆMDSUØComing soon: flat-panel TVs ÆMDBUØLarge LCDpanels, light valve projectors ÆMDNMØThe bulky, power-hungry CRT display seems headed for near-certain obsolescence. Liquid-crystal displays, till recently too expensive for consumer TVs and too difficult to manufacture at large sizes, are now coming into their own. Liquid-crystal light valves, a related technology, are being developed for projection TVs. ÆMDBOØBeating the CRT. ÆMDNMØBefore liquid crystal technologies begin to displace CRTs in mass-market products, they must drop in price and grow in resolution. LCDs don't have to be quite as cheap as CRTs--flat panels have advantages of size and weight--but they can't be more than two or three times as expensive if they are to find use in computer markets. Even in the laptop PC market, where cost is not as important as size and power consumption, most buyers have shied away from the high prices. The key to price cuts is yield. The more pixels in a display, the likelier that there will be defective cells, rendering the whole unit useless. However, larger displays need proportionally more pixels, or image resolution suffers. That, in turn, raises the problem of controlling individual pixels; due to the comparatively slow switching times of liquid crystals, line-oriented passive scan approaches quickly run out of steam. ÆMDBOØJapanese efforts. ÆMDNMØOne large-scale LCD project has been started under the aegis of Japan's Ministry of International Trade and Industry (MITI). The shareholders, including Key Technology Center, Sharp, Hitachi, NEC, Casio and Asahi Glass, have pledged funding that totals Yen2.8 billion ($20 million). The project goal: a prototype full-color 40-inch display by the fall of 1993. The current state of the art is nowhere near a 40-inch display. Ten-inch flat displays are only now moving into the mass-production stage. The largest color panel now made is Sharp's 14-inch device, although Hoshiden has shown a prototype of a 15-inch unit. ÆMDBOØMobile applications. ÆMDNMØThere's nothing like a high-volume application to push technology along the learning curve. A number of Japanese firms are looking to automotive navigation systems, along with radio displays and engine meters. But mobile systems have problems besides cost and resolution. Temperature sensitivity is a critical issue; a display would have to survive a range from 80šC (176šF) down to-40šC (-40šF), although the working range could probably be narrower. Vibration is also a problem. ÆMDBOØEliminating pixels. ÆMDNMØAccording to the June ÆMDULØPopular ScienceÆMDNMØ, an American firm, Projectavision, has patented a way to boost resolution optically. First, its device superimposes the red, green and blue dots rather than placing them side by side as in conventional systems. Second, Projectavision puts a tiny lens in front of each pixel. The improvement is said to be ``dramatic.'' Projectavision's prototype, described as a medium-resolution LCD panel, is being built in Austin, TX, in partnership with Microelectronics and Computer Technology Corp. ÆMDULØPeter Dyson ÆMDSUØSony's Mini Disc: the end of tape? ÆMDNMØSony has recently announced yet another digital media format. The 2.5-inch ``Mini Disc'' (MD) could presage the beginning of the end for audio tape and could introduce a compact CD-audio data format with immense appeal for multimedia and computer applications. The Mini Disc is made possible by two very impressive technologies. The first is a specially designed laser read/write system that enables an MD player to write (and read) a magnetic-optical disc as well as to play read-only optical CDs. This means that the same inexpensive drive can be used to record (and play back) digitally encoded music as well as to play back mass-produced optical CDs. The second technology is a digital sampling technique that allows the Mini Disc to record 74 minutes of near-CD-quality stereo sound on a disc that holds just over one-fifth the data of a conventional CD. The disc itself will be housed in a plastic ``caddy'' similar to that used for the familiar 3.5-inch computer disks. Data is read off the disc at the same rate as from a standard CD (approximately 1.4M bits/second), but it is fed to the decoder at 300K bits/second. An inexpensive 1M-bit memory chip can provide up to three seconds of buffering and make the disc drive virtually immune to shock and vibration. ÆMDBOØMarkets. ÆMDNMØSony is clearly targeting the audio market now served by tape cassettes, especially ``Walkman'' type portables, boom boxes and car stereos. The Mini Disc should be able to serve all of these markets better than even digital tape. (Imagine a 15-disc MD changer in your car's dashboard!) Although MD players will not be available until the end of 1992, it looks like a winner. The Sony digital audio tape (DAT), Philips/Tandy Digital Compact Cassette (DCC) and Sony Mini Disc technologies will be examined in our next issue. ÆMDULØJonathan Seybold ÆMDNMI/O ÆMDSUØ'Watch out for Microsoft,' says CD-ROM vendor ÆMDNMØMicrosoft's recent acquisition of exclusive rights to Dorling Kindersley's inventory of literary properties has put the community of electronic publishers on notice -- it is clear we will be competing directly with a Microsoft intent upon dominating electronic publishing. Recent history has shown there is no way to win competing with Microsoft on its own turf. Min Yee, the president of Microsoft Press, has been quoted as saying, "I don't think other publishers like Random House are scared of us." They ought to be terrified The Dorling Kindersley library includes over 400 titles in print, including the ÆMDULØAMA Family Medical Guide ÆMDNMØ(7.5 million books sold, 6 million by the aforementioned Random House) and ÆMDULØThe Way Things Work ÆMDNMØ(1.5 million sold). DK has more than text. There are reportedly over 300,000 images in DK's archives. Factor in Microsoft's rumored development of the ÆMDULØColumbia Desktop Encylcopedia ÆMDNMØon CD, and it is clear that Microsoft has picked off the sweetest publishing opportunities in the realm of home reference. ÆMDBOØDust in the wind. ÆMDNMØElectronic publishing is as yet a tiny portion of the traditional publishing business, and many big publishers have not taken note of this turn of events. The threat Microsoft poses to their future should be noted immediately. In the words of the ÆMDULØSoftware Industry BulletinÆMDNMØ, "Traditional publishers should be scared of Microsoft -- They should be evaluating multimedia technologies and opportunities now to avoid a scenario five or ten years from now where they are only minor players in a new publishing dimension." And we small publishers are merely dust in the wind. If Microsoft can accomplish one simple goal, then the game is indeed over before it has really begun. That goal is the exclusive licenses, Microsoft can play out a strategy not unlike the one contemplated by Sony in its acquisition of CBS Records and Columbia Pictures. With the acquisition of DK, Microsoft is strides ahead already, and it has a great deal of money left in the coffers. Microsoft is preparing for a contest that will pit it against an array of world-class electronics companies (Sony, Philips, Commodore, Apple, IBM and others). The prize to be won is the American Home. The competitors will be selling low-cost CD-ROM-equipped computers, much like Commodore's CDTV product. With the right properties exclusively held, Microsoft can make life miserable for anyone interested in electronic publishing. ÆMDBOØNo exclusivity. ÆMDNMØThe prescription for big publishers is simple: don't sell Microsoft or anyone else exclusive rights. They could uses such rights to withdraw key properties from exploitation on platforms competetive to the Multimedia PC. Or they might just decide to compete on those platforms, as well. Note well what Microsoft has accomplished on the Mac -- a platform directly competitive to DOS. The prescription for fledgling electronic publishers is equally clear. Before they spend the $200,000 to $400,000 it will likely take to develop a shippable multimedia title on CD-ROM under Multimedia Windows, they should calculate how long they will have access to shelf space before Microsoft picks them off. They should be equally careful about carrying on open discussion with Microsoft personnel about product plans. Bill gates is reported in a major computer trade magazine to have warned a friend not to tell him anything that he might use to competitive advantage, as he would not hesitate to use it for just that purpose. That is precisely the kind of strategic partner one can expect to have in Microsoft. Ask IBM. ÆMDBOØPeter Black Xiphias Helms Hall 8758 Venice Blvd. Los Angeles, CA 90034 ÆMDNMØEvents ÆMDBOØInternational Design Conference in Aspen ÆMDNMØJune 16-21, Aspen, CO Aspen Center for Physics (303) 925-2257; fax (303) 920-1167 Though best known as "the" designer confab, Aspen is now known as one of the seminal events for interactive multimedia ÆMDBOØVirtual Worlds: Real Challenges MDNMØJune 17-18, Menlo Park, CA SRI International (415) 859-3382; fax (415) 859-2861 A first. Should provide intelligent discussion on technical and interface issues, practical current and future applications. Attendanceis very limited. ÆMDBOØSIGGRAPH ÆMDNMØJuly 28-Aug.2, Las Vegas, NV ACM-SIGGRAPH (212) 752-0911 Annual meeting of the special interest group on graphic of the Association of Computing Manchinery (ACM). One of the industry's most stimulating shows. Highlight include screening of 50 computer animation shorts and gallery for computer-generated. ÆMDBOØMacworld Expo ÆMDNMØAugust 6-9, Boston, MA Mitch Hall Associates (617) 361-8000 Everyone goes, despite universal distaste for the fact that it's in Boston in the middle of summer. This year, expect massive doses of System 7 and QuickTime demonstration and applications. ÆMDBOØSeybold Computer Publishing Conference + Exposition ÆMDNMØOctober 1-4, San Jose, CA Seybold Seminars (213) 457-5850; fax (213) 457-4704 The annual "must attend" event in computer publishing and graphics. If we do say so ourselves. ÆMDBOØInternational TAPE (Technology, Aesthetics, Politics & Education/Entertainment) Symposium ÆMDNMØOctober 16-18, San Rafael, CA Dominican College Academy of Professional Development (415) 485-3255 Dominican College is celebrating the 100th anniversary of film with this symposium for media professionals, technologists, business leaders, artists and scholars. ÆMDSUØOur mission: to map the digital world ÆMDBUØJoin us, and track the future as it happens today ÆMDNMØDigital technology, once considered exotic and of limited utility, has become as pervasive as air. At a rapid clip, the media of communication -- print, graphic arts, sound, music, photography, video, film -- are being digtized and becming part of the datastream. Once fundamentally different, when digitized they become fundamentally the same: They can travel down a wire. They can be stored on a disc and combined in ways not previously possible. They can be altered, copied a million times, preserved forever, destroyed in a heartbeat. This concept is not new. It's the stuff of which science fiction has been made for decades. But it's happening now, and it change everything. The move to a world of all-digital media is progressing so quickly that each of us will soon be able to own all the tools to produce our own videos, publish our own books, record our own performances -- that is, to make fundamental changes to text, images and sound in way that was impossible even five years ago. Applications for digital technology will cut to the quick of the industries upon which our society is based -- publishing, computing, entertainment, consumer electronics, multimedia, information delivery, telecommunications. These applications will open vast new possiblities and raise troubling ethical questions about the integrity of information and the people who "processs" it. ÆMDULØDigital Media'sÆMDNMØ mission is to serve as a vehicle to understanding this powerful transition. And we're confident that no matter what we write about -- the computer business, video, telecommunications, broadcasting, virtual reality -- we will prove valuable to you. The shape of those insights will change along with the world of digital media. This issue, for example covers a recent spate os seismic activity in the world of interactive, computer-based multimedia. We expect that the Multimedia PC Marketing Council (page 17), Apple's QuickTime extensions to its operating system (page 14) and Sony Electronic Publishing's entry into the interactive software market (page 3) all will have a potent effect on the movement of media-based products into the home and business. Yet we also cover video compression, telecommunications, the European Community's HDTV follies, and the early development of a 40-inch flat-panel display -- the long-awaited TV of the future that you will be able to hang on your wall. These are just a sampling of topics ÆMDULØDigital MediaÆMDNMØ will address each month. This is no small undertaking. As far as we know, we are the only publication attempting to ride these wild horses all at once yet keep a borad perspective. That perspective -- from philosophical concerns to the very practical problems of how to create and sell products using digital media -- is critical to anyone who must understand or use these technologies. The surrounding issues are pressing, and they will affect every business, industry or relationship where people need to communicate with each other through time and space. We encourage you to subscribe to ÆMDULØDigital MediaÆMDNMØ. Join us as we chronicle the future as it happens. ÆMDULØDenise Caruso, Editor ÆMDSUØ