Brett Winterford's CES blog

The next explosive growth in the microprocessor industry, according to chip guru Levy Gerzberg, won't be powering a consumer electronics device. It will more likely be planted somewhere in our own bodies, under our skin, delivering critical information and executing actions that can quite literally prolong our lives.

Speaking at a forum at the Consumer Electronics Show on disruptive technologies, Gerzberg, the CEO of microprocessor designer Zoran, said that by definition a "disruptive technology" is one that changes our lives in a drastic and positive way. With that in mind, there can be no greater disruptive technology, he said, than technology embedded within the body to aid our health.

"As processors continue to shrink and use less power, the mathematical algorithms we can implement in silicon will make a very significant impact on our lives. In order to enjoy the high (Internet) speeds, the good music, all the things we keep talking about as being disruptive, we need one thing--to live longer."

Gerzberg said the chip industry is already half-way to producing processors small and power-efficient enough for such applications.

"This is an electronic pill," he said, holding up a tiny cylindrical device. "It is a camera you swallow. It goes through your intestines and it transmits via RF to a gadget in your belt. Where an endoscopic tube is a destructive technology, I call this a disruptive technology."

Future biotech advances will be even more drastic, he said. If today the industry can develop chips for cameras that are able to recognize facial features, Gerzberg says it is not unrealistic to see the same technology used to help the blind recognize the characteristics of the human face. Another potential chip, he suggests, could bring movement back to bodies with damaged nerves. Embedded in the human brain, the chip could send a signal to a damaged area within the body to zap a muscle into action whenever movement is required. Or better yet, a GPS-enabled chip might be included in a pacemaker, he postulates, which could "stimulate the heart just before the heart attack happens" and immediately give medical services personnel a heads-up as to where to find a person experiencing difficulty.

"We (those in the processor industry) are making progress," he said. "The evolutionary technology for this exists. We are getting closer to having human intelligence on a chip. Now it's time to pull it together and make it a revolution."

"I think in 20 years' time if we meet again here again at CES, there will be a new building dedicated to consumer medical electronics."

"It won't be called the Consumer Electronics Show," he said, "it will be the Consumer Medical Electronics Show."

Little over a month since Facebook's Beacon advertising service came under fire over privacy concerns, the company's chief revenue officer has said that the "social ad" will remain a key focus for the social-networking site.

Owen Van Natta, chief revenue officer at Facebook, told an audience at the Consumer Electronics Show that most Facebook users are comfortable with sharing information about the products and services they consume.

Facebook's Beacon is an advertising service which posts messages on users' Facebook profiles about any purchases they make on Facebook-affiliated e-commerce sites. These social ads expose to other users such information as what movies their friend has watched, what music they have consumed, or what brand of clothes they prefer.

The premise of Beacon is that friends and other people who are intimately connected to a user are more likely to influence a purchasing decision than any other form of advertising.

The service came under fire late last year when it was discovered that users had little control over the release of information pertaining to their purchasing decisions. After a period of intense media scrutiny, Facebook founder Mark Zuckerberg responded with an apology and offered an option which allows Facebook users to opt out of the Beacon service altogether.

But Van Natta says it was the press and other privacy advocates, and not users, which forced the apology upon the company.

"One of the reasons it took us so long (for us) to respond was because it wasn't really a user thing as much as it was the press and the folks who are trying to highlight it and make it important to people," he said.

Van Natta said that only a "small single digit percentage" of Facebook users have since taken the remedial step of a total opt-out from Beacon. And not a single advertiser pulled out of the project when the privacy concerns were exposed.

In fact, the company plans to "open up" the Beacon service beyond the first 60 companies it began with, and will eventually make it "self-service."

Facebook users, he said, are predominantly young people who have grown up in an age where they are used to their information being shared on the Internet.

"We built Beacon because when you look at people's profiles, they are already doing things to share this kind of information; there is just the friction of having to enter it all in manually," he said.

As more and more content floods the Web, Van Natta believes that a greater emphasis will be placed on the "credibility of identity and content."

"Amazon.com reviews have become far more useful since posters have had to provide their name and since users have been able to vote on whether the review is useful," he said.

"Every day I hear radio ads for restaurants, but they rarely convince me to go eat at that restaurant. A friend, on the other hand, a person who actually knows me and knows my taste, can cause me to take action. The lens through which (the recommendation) is provided is the big difference," he said.

"We think people will want to expand what they are doing with Facebook," he said. "We just have to get the product right so that there's a comfort level and people don't think their privacy is being invaded. If you don't give people that comfort they won't share that information and usage won't happen."

Even the most dedicated long-time IBM veterans say that IBM "really failed" in the consumer business in the nineties before it abandoned it in 1999. Upon acquiring IBM's PC division, says David Nichol, director of Lenovo's small business and consumer line for Australia and New Zealand, Lenovo's first priority was to get its commercial business in order before considering retail.

With its commercial range winning market share and a successful launch of a consumer range in India under its belt, the company says it is now ready to tackle the consumer market on a global basis - a market which makes up some 40 per cent of global laptop sales.

Lenovo's new K-Series ThinkCentre desktop

(Credit: Lenovo)

Lenovo's new 15-inch IdeaPad

(Credit: Lenovo)

Lenovo says it has Sony, HP and Apple in its sights and wants to position its new consumer PC's as premium products.

"We pitted ourselves against those kinds of products and only went to market once we had products that exceeded them," Nichol said. "We want to be understood as a premium brand, something that competes with HP, and something that will not be misunderstood as a low-end brand. It is very difficult to climb out of that hole if you get positioned as a low-end brand. You get discounted against the opposition."

While not being a price aggressor, he did say the new range of Lenovo consumer PC's will be priced under HP in terms of value-for-configuration. "That is a function of establishing the brand," he said. "Companies with well known brands can generally charge more of a premium. You will see us between the Acer and HP price in terms of configuration."

The PCs will be sold with one year on-site warranties for the desktop models and one year return-to-depot warranties for notebooks, aiming to turn them around within the depot in two days.

Nichol says Lenovo has no plans to sell the PC's direct and will target those mass retailers that will help the vendor position the products as a premium brand.

But for all the talk about being a 'premium' play, on first glance the new products look unlikely to unseat the likes of Sony and Apple, whose products (specs aside) are thinner, sexier and carry a better known, classic look-and-feel brand.

But Nichol says there is no reason why Lenovo can't quickly ramp up market share.

"The PC space still tends to be something of a meritocracy," he said. "If your product or the customer experience of the product is the best, its easily found out. There is a pretty mature set of reviewers that make it known what the best products are. If you have something that is really good, you can get a rapid advocacy happening in the market."

Only time, and the reviewers, will tell.

Terry McBride, CEO of the Nettwerk Music Group, which manages such best-selling acts as Avril Lavigne, Barenaked Ladies and Dido, told the CES conference today that the music industry needs to "let go it's control and let consumers own their music" in order to survive.

The industry, McBride says, has been "hitting a glass ceiling" in terms of sales. It won't grow beyond that, he says, until the industry gets rid of Digital Rights Management and drastically drops the price of downloads.

"I believe there is a tipping point where price will compete with free," he said. "Right now our metric of measurement is iTunes at 99c [per track], but that represents only ten per cent of the marketplace. The other ninety per cent of the marketplace is [downloading music] free."

"I would say then have to say that the value of a song is not 99c but more like 10c," he said. "Imagine if we were to drop the price to 25c and capture 50 per cent of marketplace? With music and movies, the perception is that the cost is too high. It needs to come down."

The music industry needs to let go of control, he said, because "the concept of copyright law only exists to the music industry, not to the consumer."

McBride has good reason to believe that a loosening of controls can boost record sales. One of the bands his company manages, Barenaked Ladies, was signed to major label Warner for the release of six albums until 2003. Offered a "multi, multi-million dollar cheque" to re-sign with the label to produce more music through traditional channels, the band opted instead to go it alone and try a few alternative means of distributing music.

Barenaked Ladies have profited from letting go of control of their music

(Credit: Nettwork )

Barenaked Ladies now record every single concert they perform and allow fans to purchase the recorded tracks on a USB stick or via download within minutes of the concert ending. They even offer downloads of the band's studio bed tracks (individual multi-track recordings of each instrument) to those fans that might want to remix tracks or create mixes with instruments left out to jam along to.

The decision, McBride says, "paid off handsomely." Last year was the band's second biggest ever from a financial standpoint.

"They have made the same amount of money as they would have if they sold five million albums," he said. "The music industry has a real issue with control," he said. "All the band needed to do is let go of that control."

Despite all the hype and bluster of industry giants such as Intel and Microsoft, the promise has to date only been realised by the small percentage of the market that can afford high end products and services from specialist integrators, and a handful of technical folk armed with the skills necessary to install their own kit.

Even people with a reasonable grasp of networking can struggle when installing equipment in the home. Things like conflicting IP addresses, the assigning of ports or knowing what a 'subnet mask' can be very daunting for the uninitiated.

Networking vendor D-Link claims to have come up with a solution, an over-arching product strategy it calls D-Life.

"Until now, a user goes to set up a media player, and they are asked to choose a Static IP address or DHCP," explains Michael Scott, technical media manager at D-Link. "Thats where my mom and dad throw their hands up in the air."

"The thought behind D-Life is to get rid of all that - get rid of the IP addresses, the acronyms, the confusing numbers and jargon. It is about making products that people can plug in and just make it work."

Under its D-Life strategy, future home networking products from D-Link, be they media players, security web-cams, network attached storage, dual-mode phones, digital photo frames, wireless printers and the like, all come with a unique pin and serial number. When a user buys one of these products, they log in to a free account at www.d-life.com and punch in the serial numbers of the new product they are attempting to install (the serial number comes as a sticker on the base of each device).

This activates the D-Link products to configure themselves, as it gives them an awareness of what other nodes/devices are on the same network. If a web-cam or media player detects that a camviewer screen or a digital photo frame is added to the network, it assumes that the screen is the destination for its content and configures itself accordingly. If a device is added to the network that has the same IP address as another, it dynamically changes its own address to ensure there is no conflict.

At present D-Link only has a limited range of D-Life ready products available in the US. Scott expects the rest of the world (including Australia) to follow within six months. Then the vendor will carry the D-Life strategy throughout its next generation of home networking products into the foreseeable future.

The D-Life family of products

(Credit: D-Link)

The catch? The system is only going to be easier for the average user if you all the products in the network are D-Life products. Add a product from Linksys or Netgear, for example, and you may need to sharpen up those networking skills after all.

In that sense D-Life is a clever way that D-Link can encourage customers into buying a complete suite of its (relatively inexpensive) products.

Scott says users need not fear being 'locked-in' to the D-Link brand.

"One of the criteria when we were developing this is that it cannot be proprietary," Scott said. "It has to work with Netgear or Linksys router. The products are self-aware enough that is a D-Link camera joins the network on the same IP address as a Netgear router, it reconfigures itself."

The technology, patented by California and Florida-based start-up eJamming, was among several new collaborative tools demonstrated by Intel CEO Paul Otellini on stage at his CES keynote, with a little help from pop group Smashmouth.

I cornered eJamming chairman and president Alan Glueckman at the Showstoppers event later in the day to discuss how the technology works.

"We literally connect musicians in real-time, synchronizing audio streams from multiple locations so they can play together," Glueckman says. "You might have a musician in China, another in Australia, one in Brazil and one in United States that can all jam together in real-time. Not only can they play together, they can write and create together or teach each other."

A screenshot of musicians collaborating online with eJamming

(Credit: eJamming)

The magic behind the scenes, Glueckman says, is a compression technology that "thins the audio data so it can be shoved through broadband pipes but still sound pleasing to a musicians ear."

Geographically-dispersed musicians can also turn eJamming into a virtual recording studio, he said.

"The really cool thing is that their performances can be recorded locally in full fidelity," he said. "Then you later can exchange a time-stamped full-fidelity track based on these local versions. [Mixed together] you get a better-than-CD-quality recording of the jam session."

Traditionally, even when multiple musicians are recording together in the same room (multi-tracking), there are often problems with latency if the system recording the tracks doesn't have enough memory or compute power. The thought of pushing such huge files in real-time over the Internet sounds like a pipe dream at the speed of most connections.

But Glueckman insists that eJamming's compression technology, coupled with software that synchronizes audio streams in real-time, means that musicians can hear each other performing in high quality audio (at least as rich as MP3) across the Internet.

It does, of course, require some decent recording gear at each end, works better with MIDI-interface sounds than actual stereo audio tracks, and requires very high broadband speeds to ensure the latency issue doesn't plague the process.

But with both home recording technology and broadband connectivity continually dropping in price, it might not be long before the technology is available to even the most humble of home studios.

Glueckman says eJamming eventually intends to bring the magic of live performance to fans dispersed across the web. At the end of the quarter, his company will launch 'jamcast' - an opportunity for acts to stream a live performance to any computer, mobile internet device or smart phone connected to the web.

"The excitement of live performance is liberated from the venue," Glueckman said.

A jamcast, he said, would be particularly fruitful for those acts that have developed relatively small fan bases that are distributed globally using social networking sites like Myspace or e-commerce sites like iTunes. A broadcast of their performance might be far more viable than a tour.

At present, eJamming's revenue model is charging a (roughly eight to ten dollar) monthly subscription to use eJamming's technology.

With Jamcast, both the musicians and eJamming will be able to share the revenue gained from from paid subscribers to a performance.

Today's Internet, he said, is a "go-to" Internet.

"The Internet reacts to our requests rather than anticipating them," he told the conference at the Venetian Hotel and Casino.

In the future, he predicts Internet services will be more proactive, predictive and context aware.

"The Internet is going to come to us," he said, "bringing us the information we need at any given time."

He expects this to have a radical affect on the wider technology industry.

When computing came to the desktop in the eighties and nineties, "computing became personal," he said, and "innovation, collaboration and standards drove growth beyond what anyone could imagine."

"I believe that the Internet is following the same path today."

Intel CEO Paul Otellini addresses CES

(Credit: Brett Winterford)

Otellini said he expects the mobile Internet device, armed with mobile broadband and location-aware technologies such as GPS, to be the one that makes best use of this "personal" Internet.

Demonstrating a number of future applications on a mobile internet device, Otellini opened a window into a future where location-based services can aid users real-time in an intuitive way. In one demonstration, the device's camera could recognise objects on a street or translate a restaurant menu, serving up an "augmented reality". While the demos were staged at CES (replicated back-stage on a more powerful computer than the mobile device in his hand), Otellini says the continual shrinking of transistors could see such services come to the mobile device in the not too distant future.

There are four major obstacles to delivering such an experience today, he said. The first is silicon. The mobile internet device, the "next big thing" in computing, he said, will need a more compute-powerful, more power-efficient processor. The second obstacle is the lack of a ubiquitous wireless broadband infrastructure to deliver these services in a wider range of locations. Third, Internet services lack context, he said, that ability to know what we need at a given point in time. And finally, he expects that computing will need to come up with more natural, human interfaces to engage with.

In terms of silicon, Otellini believes Intel to be well on the way to making the dream a reality. The company continues to find ways to shrink transistors. To illustrate, Otellini showed how a 1971 Intel chip (the Intel 4004) featured 2250 transistors and was 10 microns in size. Today's chips, Otellini said, contain a whopping 820 million transistors. That many transistors in 1971 would have required a wafer nine feet by six feet, which would consume the energy of 200 U.S. households. "Instead its the size of a thumbnail," he said.

Otellini said Intel went close to missing its mark on Moore's Law in recent years as it struggled to find new ways to shrink transistors without leaking current. But Intel's engineers saved the day, discovering "a new recipe" with which to produce the next generation of processes - a High K Metal Gate process based on the element Hafnium.

This breakthrough, Otellini said, means that the next generation of Intel chips can deliver 38 per cent more performance on the same power usage, or cut power in half with the same performance as the current generation of chips. The mobile Internet device, he said, while slightly chunky today, will "shrink half and half again" in size in the next 12 months as a result.

From a wireless perspective, Otellini predicted that the WiMAX standard, technology in which Intel Capital has invested in significantly, will win out over other competing standards to deliver the necessary ubiquitous access to the Internet for mobile devices. WiMAX is particularly strong in delivering online video, he said.

"In the next five to ten years , we at Intel believe WiMAX will bring about the change necessary," he said.

The third obstacle is context. Otellini said we need to move from searching for information on a network towards a network that finds you the information you need proactively. These services will require that users give the network an indication of their location, their preferences, and other information of a private nature.

"The impetus is on us as an industry to provide security and privacy users need," he said.

The final hurdle is interfaces. Otellini used the example of the motion and gesture sensing technology of Nintendo Wii, which has revolutionised gaming by offering more human ways of interacting with the computer, as an example of what's to come.

"Its popularity lies with the interface and not the graphics," he said. "You expect to engage and interact with the Wii. In gaming, we have moved from the keyboard to mouse to joystick to wands - with each step, a more natural engagement."

The natural human interface has been a huge theme at this year's CES.

Bill Gates talked up the Surface Computer and voice recognition in the car, Paul Otellini talked up the gesture-based interface of Nintendo Wii, and there were plenty of new ideas around interfaces exhibited on the trade show floor.

Attendees mill around Samsung displays to try out the Reactrix gesture-based interface.

(Credit: CES)

Natural human interfaces, ones that involve human movement, for example, tend to be incredibly engaging. It's rarely more noticeable than at CES--the crowds nearly always gather around those exhibits that provide some kind of interactivity. One of the most popular has been the WAVEscape advertising platform, developed by Reactrix and exhibited in partnership with Samsung.

WAVEscape is a stereo near-infrared vision system that sits above a television to enable interactions between viewer movement and content on the screen.

It uses a stereo 3D vision system to sense the distance of a person from the television. In the same way a person has two eyes to gauge proximity, the computer can get the full shape of everyone's body up to 15 feet away.

At CES, Reactrix demonstrated how users could stand in front of a Samsung LCD and interact with several games and information sites using the movement of their limbs.

Attendees play a game of volleyball on a Reactrix-powered Samsung TV.

(Credit: Brett Winterford)

The technology is being used as a means of engaging people in a public space for interactive display advertising. Reactrix's first big customer is Hilton Hotels, which will provide the technology in its lobbies and other public spaces to both entertain and provide information on hotel services.

WAVEscape was developed by Matt Bell, Reactrix's chief scientist and founder. It is inspired by an earlier product he invented called the Stepscape--a 2x3 meter interactive floor-projected display deployed in shopping malls and other public spaces that can sense a person's presence as they walk over it.

"We are using these technologies to reinvent out-of-home advertising," Bell said. "Most advertising outside of the home is billboards and digital signage. I describe this as glance media--you look at it for two seconds, if that, and then you move on. What we do is engage people, get them interacting. They have fun and therefore the advertiser loves it because the user remembers the message, and the venue is happy because the venue is more interesting."

Bell says users are 10 times as likely to recall the message of an interactive advertisement as a static one.

"It is a revolution in the way people relate to TVs," he said. "The TV is now able to sense you and respond to your wishes."

WAVEscape inventor Matt Bell shows off an interactive TV application

(Credit: Brett Winterford)

Beyond advertising, Bell sees applications in other verticals, such as education (pulling apart molecule diagrams on a classroom screen, for example) or as an attraction in a nightclub. "Ultimately this could be baked into any display to optimize the experience for whoever is using it," he said.

Eventually, he'd like to see it in the home.

"It will take a few years to make its way to consumer. Right now it's relatively bulky, but all of this will be shrinking as rapidly as we can so we can get it into the consumer market. In the home, you might be sitting on your couch and you gesture with your hand to change channel if you are sick of the program."

"Gestural interfaces are exciting because they are so natural," he concluded. "We communicate with body language. You get a display that's able to understand body language and that's very powerful."

Panasonic's giant 150-inch plasma at CES

(Credit: Brett Winterford)

The endless quest to produce the biggest and best televisions continues to astound, even if there's barely any practical applications for them.

The Lifescreen, which measures 8 feet by 12 feet and has a resolution of 4K by 2K (four times the resolution of 1080p high definition), might look great on the trade show floor but one would wonder where else it could fit.

Panasonic see a market for it - released by the end of 2008, the Japanese manufacturer will begin mass production in 2009.

Its massive size, I would suggest, means its unlikely to be a retail play.

"You're right," said a Panasonic attendant dwarfed by the screen. "You have to wonder how you're going to get it in the house too!"

But that was precisely the atmosphere in Las Vegas tonight as he both opened this year's CES conference and closed a final chapter of his career.

Thousands of journalists and technologists queued for some four hours in snake-like lines that wound around several floors of the Venetian Hotel and Casino to hear him give his tenth and final CES keynote.

In just under six months, Gates will retire from full-time work with the software company to devote his time and energy to his philanthropic project The Bill and Melinda Gates Foundation, which aims for global equity in healthcare and education. As several Microsoft devotees said during the long wait to see the show, Gates' last CES keynote is a significant event. This was the man that revolutionised desktop computing and in the process influenced the career opportunities for millions of IT support workers around the globe. And for the very dedicated few among the 140,000 people in Las Vegas for this year's CES, it is likely to be the last time they will see him talk.

Gates isn't a dazzling stage-performer by any stretch. His squeak of a voice has nothing of the immediacy or intensity of some of his peers (Cisco's Chambers comes to mind), and he hardly appears the rock n' roll type with his daggy blue sweater and slacks.

Microsoft Chairman Bill Gates adrresses CES 2008

(Credit: CES)

Thankfully there were plenty of stars at hand to liven up the event.

Early in the address, Gates was treated to a pre-recorded tongue-in-cheek send-off that included appearances by presidential candidates Hillary Clinton and Barack Obama, former vice president Al Gore, U2's Bono, Hollywood director Steven Spielberg and actor George Clooney, all joking at Gates' expense as to what he might get up to upon retirement.

Among the frivolity, there was the business. Gates discussed the next "digital decade" as being one in which high definition content will be pushed to all manner of devices. He then touted the further development of the natural/human user interface - making an example of Microsoft's touch-based 'Surface' Table Computer, but not mentioning the Nintendo Wii or the Apple iPhone, both pioneers in the field.

Gates predicted that PCs will again grow this year at double digit growth rates, and announced that Microsoft's latest Vista operating system now has some 100 million users. He also announced that broadcaster NBC will be offering some 3,000 hours of footage from the Beijing Olympic Games online using Microsoft's Silverlight and Live software technologies.

In gaming, Gates' colleagues announced that the company has shipped some 17.7 million X-Box games consoles, claiming that more cash is spent on XBox games than games for both Nintendo Wii and Sony Playstation put together.

The company also showcased new innovations in the digital home and for the portable music player Zune and demonstrated ways in which Microsoft technology can be used to improve the communications and entertainment experience while driving in a car.

There would be no major product announcements, nor any emotional farewell.

Instead his keynote closed, as perhaps the long wait to see Gates speak deserved, with some real rock n' roll royalty - a live Guitar Hero jam-off with Guns N Roses guitarist Slash.

Microsoft Chairman Bill Gates summons Slash for a Guitar Hero duel

(Credit: CES)

Then Gates, unassumingly, walked off the CES stage for the last time.