Job One: Figure out why anyone would want one

Revolution, empowerment and compelling economics were a few of the verbal sticks that panelists were rubbing together to make sparks fly at “The New Consumer Devices: A New Class of Product” panel at Digital World.

Virtually none of these new magical devices has yet seen the light of day, but panel members believe that they will fundamentally change the way people conduct business or their personal lives.

Some would argue that the panel was slightly misnamed. John Sculley has already admitted he wished Apple hadn’t decided to first announce and demonstrate its new Newton technology at the Consumer Electronics Show, because it set up an expectation that Apple was indeed trying to reach Joe Sixpack with its relatively expensive (probably around $700) personal digital assistant, or PDA.

It’s important to keep in mind that what’s being called a “consumer device” today embraces PDAs as well as home multimedia players and handheld, “very personal computers.” They all embody a compact, powerful vision of classical convergence: the raw horsepower of today’s personal computers and software, combined with the accessibility, small size and specific (as opposed to general) functionality of consumer electronics devices. And they’ll be sold through consumer channels as opposed to specialty stores, thus the slightly skewed nomenclature.

Depending on the application, the new consumer devices will rely heavily on built-in communications capability, whether built-in ports to the existing phone or cable TV system, cellular data modems or wireless infrared connections to computer networks.

KALEIDA’S NEW LEADER SPEAKS OF EMPOWERMENT

The most starry-eyed of all the panelists, understandably, was Nat Goldhaber, whose appearance on the Digital World stage was his first as president and CEO of the Kaleida joint venture between Apple and IBM. Goldhaber enthusiastically endorsed the concept of the new consumer devices, saying that they would provide the opportunity to empower individuals by “extending their minds and bodies” and giving them the opportunity to observe information, interact, query, entertain and educate and significant ways.

The mission for Kaleida right now, he says, is to develop and license a scripting language and players for consumer-level operating systems that will work on multiple platforms and allow developers to spend more money on production values for multimedia. “That will begin to entice people sufficiently in the marketplace to start people using multimedia devices in their daily lives,” he says.

The idea, he says, is to bring the microcomputer into the consumer world. And those who have seen demonstrations of Apple’s newest technology, the Newton architecture for PDAs, can see how such devices will at the very least make the untethered office not only viable, but pleasurable — and despite a comparatively hefty price tag, likely to be within the budgets of many knowledgable workers who spend a fair amount of time out of the office.

However, the question of viability looms large when one considers moving these devices out of the hands of the computer-familiar and into the hands of the real, true consumer population. Enter the much debated “consumer multimedia player” concept.

TOSHIBA ASKS, ‘WHO NEEDS IT?’

Joining Goldhaber on stage was the refreshingly candid Koje Hase of Toshiba. During Digital World, Toshiba announced its plans to jointly develop a multimedia consumer player with Apple Computer, and also that it would license core software technology from Kaleida.

Hase’s analysis of the multimedia “industry” may be a little painful, but sometimes it’s necessary to have the bandage ripped off unceremoniously for the wound to heal. In essence Hase asks, Who needs it?

That pesky couch potato. “What can you do about couch potatoes? We are very tired, overworking, exhausted. You would rather have a beer in your hand and watch TV,” he said. “I don’t need multimedia. The next real issue is interactivity. This couch potato does not want any interactivity. So who wants interactivity now? That’s the next question.”

He then pointed out that consumers, “with due respect,” aren’t really rocket scientists when it comes to consumer devices. He said that fully one-third of the support calls that Toshiba receives are resolved by having the customer plug the device into an electrical socket. Those who believe that multimedia is messiah to a population of gadget-phobic couch potatoes had better wake up and smell the coffee.

Consumers consume. Hase raises another vital point, various facets of which were discussed in other panels (most notably “Multimedia Computing,” p. 23). There is a school of thought that says there are storytellers and there are game players and never the twain shall meet. This philosophy flies directly in the face of interactive multimedia, which presupposes that there is something inherently better about interacting with the story than simply listening, watching or reading it.

Hase’s not so sure about this. “I want to sit down and really absorb myself into the dreamy world of some producer, not interact with what those producers brilliantly executed,” he says. “Happy endings, heros, heroines — we don’t want to destroy the world of illusion. Do we want, when we watch Lethal Weapon, to interact with them? I don’t think so. If we interact, Batman may not return.”

In other words, consumers consume. They don’t want to have active participation in the program. They don’t want PC-style interaction. They aren’t waiting to be rescued from their reviled (by us) couch potato status.

HOWEVER: NO ANSWERS,NO SALES, NO MARKET.

So if this is true, then what is Toshiba doing developing multimedia devices and PDAs? Hase admits that he’s not sure, that it’s the consumer’s mind that we need to read. He seems to believe that PDAs can bring about a new lifestyle, a new environment, in the same way that video tape recorders introduced the concept of “time shift” into the culture. “It’s a time machine,” he says of the VCR. “It was a new lifestyle for consumers, therefore they bought it.”

Another lifestyle shift brought about by Japanese consumer electronics was the automobile-as-lounge, with the introduction of high-quality audio into the mobile environment. Sony’s Walkman had a similar effect.

So the question we should be asking ourselves, Hase says, is whether a new device also offers a new lifestyle for the consumer. If so, he believes there’s a possibility for success. If not, and if the devices are just a new set of technical jargon and useless features, the PDA market will not succeed.

The interactive potato. At this point, says Hase, it looks as though the delivery of information is going to play an important role in this lifestyle switch to PDAs. This point of view is gaining popularity in a number of quarters; (see the story about keynoter John Evans of News Corp., p. 12 for a most opinionated view).

In the age of broadcast TV, people didn’t have much choice, Hase says. But now people want very specific types of information quickly, and to have it delivered directly to them — what he calls “narrow-catch.” In this way, mobile technology may allow consumers to get their hands on information or media that they would have had to search out before they bought their PDAs.
In other words, he says, the industry must try to create a platform for a new lifestyle Hase has dubbed the “interactive potato.” After more than half a decade of talking about multimedia, it is still a zero billion dollar industry. “We must make some sales eventually,” he says. “We must have some answers.”

THE EVOLUTION OF THE PC REVOLUTION

Avram Miller, vice president of corporate business development at Intel Corp. in Santa Clara, CA, agrees that information delivery will be the bread-and-butter for handheld computing devices. “It’s a continuum of what started 10 years ago,” when personal computer applications moved from vertical to horizontal applications. He calls it “the evolution of a revolution.”

And the evolution as he sees it is from desktop to mobile computers. But regardless of whether it’s a wrist-computer or PC-in-a-pocket, the power for the business user is to make these devices part of the continuum of computing — not just putting a personal information manager in their briefcases, but the kind of tool that can really solve problems.

To do so, he believes it’s important to address the minimum of technical issues, not the maximum. Since the problems are communication, information retrieval and vertical applications, the minimum things to address in a handheld device are interoperability, compatibility (though user interfaces don’t have to be the same), ease of use, connectivity, mobility, simplicity and reliability.

Although companies like Apple clearly have the same lists on their boardroom whiteboards, Miller reminds us that these are difficult problems that require a lot of attention, and they require absolute commitment from both silicon chip firms and from consumer electronics companies.

Sounding a familiar theme, Miller said, “No one will be successful unless we really pull together.” Despite his president’s call that alliances are formed out of sheer greed, Miller states bluntly that “we are at Intel willing to work with anyone in any industry toward these objectives.”

WHY DOES PROGRESS HAVE TO BE SO SLOW?

Though everyone is intrigued with what Trip Hawkins is up to with his extremely well-funded and equally secretive SMSG group in San Mateo, CA, the traditional speech he gives about the need for highly interactive (as in suitable for games) 3D graphics in addition to full motion video for consumer devices is still — sadly for him, and for us — as fresh as when he started talking about it a couple of years ago. There hasn’t been much consensus, or much progress, toward solving the serious problems in the process of designing a truly useful consumer multimedia device.

The industry’s inability or unwillingness to solve critical problems of cross-platform development, scalability, compatibility and sufficient performance for high-quality 3D and animation keeps it from doing the one thing it wants to do: create a breakthrough product.

But as Hawkins says, it’s time we started looking at “the market” differently. He says there isn’t one market, but three for consumer devices — the home office, the portable appliance, and the big-screen experience. It seems most likely that at least in the short term, the shortest road to success in the new market for consumer devices is to make them as application-specific and inexpensive as possible.

The application-specific part isn’t a problem. There are many people today who have actually spent the $300-plus on a Sharp Wizard-type device, and might even fork out just about the same amount for one of Apple’s far more elegant and powerful Newtons. But consumer product? Who are we trying to kid? The only way these products will reach the consumer — the actual consumer, not the kinds of people who subscribe to newsletters like Digital Media — is if they win it in a radio contest. Or, perish the thought, if the people who make them decide to sell them at a price point that the consumer recognizes as actually consumable.

Denise Caruso