David Wertheimer's blog

CES, Las Vegas: On a panel today at CES, I had a chance to discuss with several industry executives what challenges exist in "Embracing the Connected Consumer." The consensus was that we're doing a good job of providing bandwidth and electronics, but not a good enough job of bringing it all together into a seamless cross-platform experience. The interconnects are still missing -- content is marooned on the island of whatever box or ecosystem it lives on. Or so it seems. Is there light at the end of this tunnel?

Interestingly enough, I spoke before the panel to Scott Smyers, Chairman of DLNA and SVP at Sony Electronics. The Digital Living Network Alliance is an industry group comprised of 250 CE, tech, and content companies that has been working on exactly this issue since 2003. In 2008, there will be 1,800 products (yes, that's what they say) that are DLNA certified. That means that once in your home, connected to your network, they can trade content -- no matter who makes your devices. Your wifi-enabled camera's pictures are available on your TV, and even your iPod's music can play on your Bluetooth-enabled stereo. What's most fascinating is how many DLNA-certified products are out there that people don't know about. Did you know that the Playstation 3 in your living room right now can play your iTunes content straight from your computer? No? Well, don't feel bad. Not many people do.  ...[continued]

CES, Las Vegas: When CES opened two days ago, Bill Gates brought lead guitarist from Guns-n-Roses, Slash, onto the stage with him. That was fun. But move over, Bill, because I was on the stage tonight with Bono and The Edge. 

I had front row seats to the coolest U2 concert I've ever seen -- and I've been to several of them. What made this one special was how close I was able to get to the band. REALLY close.

The good news is that almost everyone in America will have the same opportunity when National Geographic Entertainment releases U23D, on January 23rd (in IMAX) and February (in other digital 3D cinemas).

I've seen most every film and live event made recently in 3D, and I believe this one moves the industry forward. It may change the way you think about 3D, or at least the way you go to concerts!

U23D was so convincing that there were moments in the film when I was looking through the crowd at the stage that I had to remind myself that the people dancing in front of me weren't really there. There were times when I smiled because the 3D made the experience more rich and textured than even if I had been there.

Beyond the simple enjoyment of the experience, though, seeing it made me realize how new Live 3D is as an art. There is not a well-accepted grammar for filmmaking like there is in cinema. The shot framing and editorial are quite different. As I mentioned, at times, I was there. Then there were moments when I focused (literally) on the effects, the transitions, or the wrong part of the screen.  Some of that was technical, but most was a result of creative decisions that were made. Maybe not wrong, but just different, and audiences aren't trained by experience how movies like this look.

These are still early days for digital 3D, and the field is still open to creative innovation. Now that the cameras and projection make the creation and distribution possible, it's time for more people to study and focus on the creative aspects of the experience. There's a lot of learning and experimentation yet to be done as 3D evolves from being just a gimmicky way of distributing a 2D movie into being a truly unique form that stands on its own.

So, U23D may not have been perfect, but I loved it. I walked out with the same kind of feeling I had after going to real U2 concerts -- without having to deal with parking and having to sit through some lame warm-up band! ...[continued]

CES, Las Vegas: Today was a big day of press conferences from the major Consumer Electronics companies. For the most part, each company told the press how they were leading in LCD TV's, and many claimed to have bee the first to make or sell LCD TV's in America. I found myself wondering, "If everyone is leading, then who's following?" then I remembered my 10th grade statistics teacher who said, "Numbers are numbers. What you do with them is something else."

Other than the Blu Ray/HD DVD news, which has been covered elsewhere, there were some interesting comments/themes that emerged. ...[continued]

It's interesting -- at the CTIA Wireless IT & Entertainment show , there seems to be precious little talk of entertainment – the content that is. Most of the talk at the show was about business models -- “How do we make money in mobile?” Carriers are making 15% of their revenue from non-voice services, which sounds wonderful. But, dig a little and you find out that it's mostly wireless internet and SMS. Entertainment on mobile is still really only about ringtones (which account for 10% of the record industry's revenues), wallpapers, and a little about games. And even that, as CTIA itself says, is “beginning to slow." Flattening adoption at a time when multimedia-capable handsets and content choices are increasing dramatically is not a good sign. The area in the chart between potential and actual is expanding. That’s either a disaster or a future opportunity, depending on where you sit. ...[continued]

Leonard Kleinrock, sometimes referred to as “the Inventor of the Internet,” spoke recently at an MPAA workshop called “the Expanding Universe of Internet Entertainment.”  In Leonard’s speech, he quoted Rick Rubin from a NY Times article, and Rick’s efforts to revive the music industry by pushing for a subscription music model.  Leonard mused about whether subscription is potentially the panacea for digital movies as well.   ...[continued]

The media is always up for a “Blockbuster is Dead” story. It began back when Video on Demand (VOD) was first introduced and has been like an intermittent drum beat ever since. It’s always fascinating to me how the same story can be written again and again. But as Mark Twain would have said, “The reports of the video store’s demise have been greatly exaggerated.”

Nevertheless, here we are again – Blockbuster is still here, and last week’s launch of the Vudu box spawned a spanking new crop of the same old article . The Vudu box ($400) sits on top of your TV and delivers up to 5,000 movies on demand. It’s taken its place among its predecessors as a “video store in a box.” But that’s the biggest problem. It’s a box. And there’s no evidence that consumers want to buy another box (just ask Best Buy how Apple TV’s are selling). This is especially true when, like in the case of Vudu, that box quietly turns their home into a P2P server, serving up movies to their neighbors -- eating up-stream bandwidth and potentially putting them in violation of their Terms of Service with their home Internet Service Provider. Let’s look at this another way – The Cable companies have very sophisticated VOD systems in place, and Blockbuster still exists. TiVo has a great product, and they’ve only been able to amass 4 million subscribers in how many years? And their box does a lot more than provide movies (which it now does, thanks to Amazon Unbox).  ...[continued]

In a dark corner of the “Emerging Technology” section at the SIGGRAPH conference in San Diego, something interesting was hiding. I almost missed it – a little opening in black curtains. Stepping inside, I found two high-end HDTV’s playing what appeared to be fuzzy images. But when I donned the shutter glasses that were handed to me on the way in, I was surprised to see the best 3-D I’ve ever encountered – crisp, believable, and close.

3-D itself isn't news -- we've discussed it at length in the Digital Cinema discussions at ETC and elsewhere . What surprised me was that this 3-D was running on unmodified TV’s from Mitsubishi and Samsung that are in the market today. 3-D TVs are in the stores, but nobody seems to know it. Apparently, Texas Instruments, my hosts at the booth, are baking the 3D capability into DLP products, and Mitsubishi and Samsung are delivering it today.  ...[continued]

It’s all over the press, Google wants to buy wireless spectrum. Even my six year old knows that Google is bent on world domination (and doing well at it), so it’s not too surprising that their next step is buying the air.

But what’s fascinating about this story is Google’s intent to partner with small carriers on the use of the spectrum. They apparently want to buy but not operate the network – as Chris Sacca, Google’s head of special projects said, "We see a lot of companies in this space who we would love to collaborate with." That’s a bit unusual for Google – a company that tends to build or buy, but rarely to partner.

So, why is Google looking to partner here? Especially when sometimes, it’s great to own and do everything yourself. Just ask Steve Jobs. The success of the iPod was the seamless user experience – from service (iTunes Store) to software (iTunes) to hardware (iPod) to software (iPod User Interface) again. Everything works the way Steve wants it to – because he controls it end-to-end. It’s a closed loop. That's the beauty and the curse.

At MacWorld, when Steve introduced the iPhone, he quoted Alan Kay, saying "People who are really serious about software should make their own hardware."

But my iPhone is not an iPod. As an impress-your-friends toy it’s a wonder, as an iPod, it’s beautiful, as a phone, it’s nice. But as a converged device, it is utterly painful – because it’s reliant on a data network that is spotty, reportedly overloaded, and wicked slow. A chain is only as strong as the weakest link, and the iPhone’s network is just that. When I found out that the game Bejewled was available on the iPhone today, I rejoiced for about 10 milliseconds before I realized that I would need network connectivity, since every add-on app (including Bejewled) must run in the Safari browser over the net. The iPhone has promise, but even though AT&T was willing to give Apple deal terms that nobody else was (control over the customer, and a share in access fees ), what it couldn’t give Apple was control over the entire user experience.  When I’m yelling at my iPhone and seeing “Could not activate EDGE,” I am quite sure Steve wished he controlled the network too.

So, that brings us back to Google. $4.6B (to buy the wireless spectrum) is real money to Apple and the rest of us, but it’s a few less lattes for Google. They’re about the only company on the planet that could realistically own, operate, and control the entire range of converged user experiences. But they’re telling the world they’re going to partner.

That gives me hope -- Google is betting that they can work with others, each bringing what they do best to the table. True convergence crosses boundaries of expertise. Either you own it all, or you get good at leveraging the strengths of others. It’s increasingly difficult to own it all. So, as the bar gets continually raised, each player has to bring their “A” game to the stadium. The fact that Google wants other people on their team may just raise the game of multiple industries – not just for a single player, but across the board. And, if we’re lucky, that will help provide better consumer experiences and more choice for everyone. ...add new comment

There’s a lot of hysteria surrounding the iPhone. It’s a phone. OK, my Treo’s a phone. It’s an Internet device. OK, my Treo can browse the web (sort of). It’s a digital music player. My Treo does that. It’s a camera -- got that too. So, does the iPhone really matter?

Yep…but probably not for the reasons you expect.

The iPhone is important, not because it will dominate July mobile handset sales, but because it will be a bar-raiser in the world of convergence. For 15 years, the industries talked about convergence, thinking that convergence meant TV and PC coming together. Only in the last 5 did the world add mobile to that melting pot. But convergence is happening, and it’s in your hand (as well as your PC and living room). ...[continued]

There was a time when you could safely assume that a product’s existence on store shelves meant that it had undergone some reasonable level of testing. I guess those days are gone. In today’s hailstorm of consumer electronics raining from the heavens, it seems that the emphasis is on getting to market, not getting it right.

Years ago, I learned the difference between the words “to” and “through.” I learned about the industry’s zeal to report “sell to,” which meant how many items you shipped to the retailers. Apparently, it was easy to jack this number up by just getting retailers excited about a flood of orders that would never materialize. You may remember stories in the post-Enron days about shipments sitting in an empty warehouse being counted as “sales”. A much more meaningful statistic I learned was “sell through” – how many products the retailers actually sold through to consumers. But now, more than ever, the thing that counts is “net unit sales” – how many products are sold less the number that are returned. Because, today, product complexity and poor design are causing record returns. And despite the sense you get from the press, that lack of consumer understanding is hampering the transformation to a digital lifestyle.

To my wife (my prototypical non-technical but intelligent consumer), Best Buy these days feels a lot like a science fair. There’s a lot of stuff there that looks like something she understands, but upon closer inspection, it’s mostly over her head. 480p, 720p, 1080i, 1080p, HD DVD, Blu Ray DVD, DVR's, Sling Boxes, Routers, Gateways, Hubs, Switches, Wireless G, Draft N, oh my! Generally, she runs out screaming. But if they can get somebody like her to buy something (other than CD’s and DVD’s), the odds are good that the product will come back to the store.

Historically, returns in consumer electronics stores have been in the mid-single digits – generally around 5-8%. With today's crop of digital media-oriented products, that ain't the case. We’ve heard that home networking return rates range from 30-50%. HDTV’s are still returned at a remarkable clip, but consumer confusion doesn't always end in a return. A large number of buyers of HDTV’s don’t get HDTV signals and don’t know it. I had a guy on the street tell me recently that his HDTV improves his standard-def TV signal quality. Huh? Confusion runs rampant and is impacting enthusiasm for the products. ...[continued]