The Lesson of Super VHS

Many people won't remember Super VHS, an improved version of VHS which enabled somewhat higher video resolution using special video tapes. During the 1980's, I had delayed buying a video recorder and hence skipped the VHS vs. Beta decision. Around 1989, I finally gave in and purchased my first video recorder. Of course it needed to be VHS compatible because Sony's Beta format had ceased to be market leader. But a new enhancement had entered in the market, "Super" VHS. Because this was my first VCR and I wanted to be "forward compatible" with the rental market and because I wanted the improved resolution that S-VHS offered, I purchased a high-end JVC model for about $700 (a bit of money for a VCR, even back then).

The purchase came with an offer for one free movie in S-VHS format and from the limited catalog, I chose "Blade Runner." Little did I realize then that the S-VHS catalog would not be growing. In fact, that was the only S-VHS pre-recorded movie that I ever owned. (I did purchase S-VHS blank tapes and made some over-the-air recordings).

So what relevence does this story have today and how as marketers of consumer electronics did we learn from it? Very little, it appears. The consumer electronics market has been littered with dead-end technologies and devices that early adopters purchased but few others did. Remember other failed technologies? DAT (Digital Audio Tape)? Sony's MiniDisc? Dolby "S"? We could go on.... The reasons for these failures are numerous and could be the subject of a PhD thesis. Incomplete complementary eco-system. Lack of content. Limitations in licensing to partners. Rival technologies. Questionable customer value proposition. Overly complex products. Failure to inter-operate with the consumer's existing devices. And more...

What is the story today? Bluray vs. HD-DVD. Sirus vs. XM. HD-Radio. Home-networking and the "Digital Home". Xbox 360 vs. Wii vs. Playstation 3. Cable vs. Satellite vs. IPTV vs. Internet download video vs. NetFlix vs. Blockbuster. I could go on...

What lessons have I learned from this?
Lesson #1. It's not the technology/features/whizzy stuff (Stupid!)

• Don't confuse cool technology (number of polygons rendered per second, etc) with actual usefulness of the device. The two are often independent.

Lession #2. Timing is key.

• Waiting to see if the technology sticks past the early adopter purchases will weed out marginal ideas. For technology marketers, see "Crossing the Chasm" by Geoffry Moore for an extensive discussion of technology adoption strategies.

Lession #3. Sticky technologies have a robust eco-system.

• Be wary of technologies promoted by a single company (or a false front organization shilling for a single company). We all know the mantra against "proprietary" technologies but it's true that single company promoted technologies have much higher barriers to acceptance (how may UMD (Sony's video mini-disk format for the Playstation Portable) are avialable today which are not from Sony's Columbia label?)

2007 - The Year of Navigation

More extended commentary from CES. 2007 will be the year of navigation. This was clear from the plethora of navigation devices at CES from a variety of new entrants. The cost of GPS receivers modules has enabled much lower cost GPS receivers.

Entry level GPS receivers will be available for under $300 in retail.

Uniden, mostly known for cordless phones, announced three new personal navigation devices including the Maptrax 402 and 352.

Sony showed a geo tagger (GPS-CS1) which logs geographic position for 190 hours and then adds geographic coordinates to your photos. It matches the time codes from the photos to the logged position (sampled very 10 seconds) and works with most cameras (MSRP: about $150).

LG showed a device for the Korean market which combines a GPS receiver with a T-DMB digital TV receiver for those who get lost easily and need entertainment while locating their destination.

Kenwood showed an in-dash mounted double DIN navigation unit with a 6.95" display, TMC traffic data from XM or Clearchannel, Garmin navigation hardware, and DVD playback.

Blaupunkt and Kenwood announced a joint venture to develop PND's.

Korean company iRiver announced a WiFi enabled GPS receiver.

Navigon announced that it will offer free real-time traffic data using Clearchannel's real-time traffic service.

TeleNav announced a cellphone based navigation service.
Various Asian manufacturers including Aigo, Malata, and MSI showed low cost systems.

Web Coverage of CES

News:
This Week in Consumer Electronics (TWICE) - http://www.twice.com/
CNet - www.cnet.com
EE Times - www.eetimes.com/conf/ces
EE Times (video reports from CES) - http://www.eetimes.com/news/latest/showArticle.jhtml;jsessionid=ZHZIJAKDCP2REQSNDLSCKHA?articleID=196801939
Macworld Magazine (yes, they covered CES) - www.macworld.com
Newsweek - http://mytech.talk.newsweek.com/
San Jose Mercury News - http://www.mercurynews.com/mld/mercurynews/business/special_packages/ces/
The Register (CES in 5 minutes) - http://www.reghardware.co.uk/2007/01/12/ces_in_five_mins/
The Register Hardware - http://www.reghardware.co.uk/
Wired - http://www.wired.com/
PC Magazine - http://www.pcmag.com/prestitial/0,,,00.asp?success_page=%2Fcategory2%2F0%2C1874%2C2034652%2C00.asp
Infoweek - http://www.infoworld.com/archives/t.jsp?N=s&V=84945


Blogs:
10 Apples Blog - http://10apples.com/wp/2007/01/11/ponderings-on-ces/
Engadget - www.engadget.com
What is New (UMPC focused) - http://www.whatisnew.com/default.aspx
ValleyWag - http://www.valleywag.com/
San Jose Mercury News - http://www.mercextra.com/blogs/ces/
San Jose Mercury News (Dean Takahashi) - http://www.mercextra.com/blogs/takahashi/
New York Times Blogs - http://bits.blogs.nytimes.com/
EE Times Consumer Blog - http://www.eetimes.com/blog/news/archives/consumer/index.html?loc=consumer
Wired Blog (Ugly gadgets of CES) - http://blog.wired.com/wiredphotos15/
Anandtech - http://www.anandtech.com/
ExtremeTech - http://www.extremetech.com/
I'll be adding new sources to this list as I uncover them.

Fear and Loathing in Las Vegas - CES and Disruptive Innovation

From Las Vegas, NV - Everyone who's been to CES (Consumer Electronics Show, www.cesweb.org) after Comdex collapsed will agree that it is a zoo. 140,000 people makes for huge lines for everything. Yesterday, while taking a cab from the Venetian hotel to the Las Vegas convention center (about 2 miles - it took 20 minutes in traffic), I started to talking with the cab driver. Ahmed said that he was originally from Iran and immigrated to the U.S. in 1972, "when everything was better" (now he said, "everything is bad") and went to college in Kentucky. Later, the owned four video rental stores in the Salinas, California area. He closed up his stores five years ago after Blockbuster stores started opening up in the area and moved to Las Vegas. Now, he drives a cab two days a week and travels. He mentioned that two of the Blockbuster stores near him have closed recently , no doubt due to the popularity of purchasing DVD's from big box retailers, renting from NetFlix and now downloading movies through services such as iTunes.

Existing technologies such as two-way digital cable (pay-per-view) and new technologies such as IPTV (ie, AT&T's U-Verse service), Microsoft Windows Media Center, Microsoft's XBox 360, MovieBeam, as well as download services like iTunes, CinemaNow and MovieLink are all vying to replace Blockbuster and they are already having an affect. Every time, a new technology replaces the old regime, someone is affected whether it is owners of small video rental stores or the guys who work in the Blockbuster stores. Of course, new technologies also provide new opportunities to those precient or fortunate enough to be at the right place at the right time. But, let's not overlook the impact on those who are on the wrong side of technology.

I'll be posting my observations from CES in the next weeks.

Product Review - HP Pavilion dt6000z Entertainment Notebook PC

In another of my IT duties over the Christmas holidays, I helped my brother-in-law set up the new HP Pavilion dt6000z notebook that he had purchased for his wife. Although the main use for this system is to run CAD software, he picked the Pavilion line which was on special at Circuit City before Christmas.



Key Features:

• Intel Core 2 Duo (T5200) processor, 1.6GHz, 2MB L2 cache, 2 cores
• 1 GB DDR DRAM
• 15.4" WXGA wide screen display (1280 x 800)
• 120GB 5400 rpm SATA disk drive
• Windows XP Home Media Center Edition, with upgrade to Windows Vista Home when available.
• HP LightScribe DVD 8x Dual Layer DVD+R/RW writer
  

Nice Features:

• 1.3MP web camera
• Remote control for DVD playback, fits into the ExpressCard slot for storage
• Touch sensitive media control keys

Pluses:

• The Intel Core 2 Duo processor which 2 cores was very responsive. I had no trouble running a antivirus scan and DVD playback software at the same time.
• The 15.4" wide screen display is bright and great for viewing movies.
  
• The HP QuickPlay software launches the DVD player without running Windows for those times when you just want to watch a movie without any other apps.
  

Minuses:

• Does not include system restore disks. Included software to make your own system restore DVD's took over an hour to make.
• Does not include Microsoft Office (only the trial version)
• Includes lots of trial software and offers for subscriptions. Removing all of this unwanted software took several hours and freed several gigabytes of disk space.
• HP configures the disk drive into a C: and D: partitions. The D: partition (11GB) contains restore versions of system drivers. I'd rather this was included as a DVD and free up the 11GB.
  

Divergence vs. Convergence

In the San Jose Mercury News on December 29, 2006 http://www.mercurynews.com/mld/mercurynews/business/technology/personal_technology/16343174.htm, Dean Takahashi discusses how personalization, not convergence, is a key driver in many consumer electronics products. Convergence of consumer electronics products (ie., TV+Internet, Phone+Internet+Camera+MP3 Player, etc) has been given in the "better, faster, cheaper" world of the next hot device but Takahashi quotes MIT professor Henry Jenkins (www.henryjenkins.org) in saying that the consumer's desire to adapt devices and services to their own tastes and preferences are the real drivers of 21st Century consumer electronics. According to Jenkins, consumers want to be able to express their creativity with these products and are seeking products and services with multiple, open interfaces which allow customization. As examples, he sites MySpace, TI's DSP's which supports multiple codecs, Microsoft's X-Box 360 which allows users to save custom music playlists and incorporate their own music soundtracks in the games, and of course, YouTube.

Fundamentally, I agree with Jenkin's premise that convergence for the sake of convergence is counterproductive and consumers will see through the limited value propositions that these devices offer. The most recent example of this was the Samsung digital camera with integrated MP3 player. Stitching multiple, and often unrelated devices, together does not increase the utility of any of the devices and often results in a combined device with is inferior to the best-in-breed individual devices.

Another trend is if it doesn't add to the BOM (bill of materials), include it as a feature. As an example, web browsers, certainly a useful feature, are appearing in lots of devices in which web browsing is not a desirable usage model. For example, why does the Sony Playstation 3 http://www.us.playstation.com/PSP?ref=http%3A//www.sony.com/index.php have a web browser built in? There is no keyboard on this gaming device, which makes web browsing an exercise in frustration. Or, the Sony Mylo http://www.sonystyle.com/is-bin/INTERSHOP.enfinity/eCS/Store/en/-/USD/SY_BrowseCatalog-Start?CategoryName=cpu_PersonalCommunicators&CP=sony_hm_nav_elec_myloshop&ref=http%3A//www.sony.com/index.php which also has a web browser built in. The Mylo does have a keyboard but the display is so small, that viewing the full web page requires constant scrolling left and right, not just up and down. These are devices which are fine devices for their intended uses of game playing and instant messaging but because adding the web browser feature didn't add much in additional cost, it was included.

Introduction and Scope

My goals in authoring this blog are to discuss and debate trends in consumer electronics, web 2.0-based internet applications and enterprise applications. I'm currently involved in developing several consumer electronics devices. Previously, I have worked in product marketing and business development for semiconductors, enterprise servers, and telecommunications products for 14 years. I hold a MBA in marketing from UCLA's Anderson Graduate School of Management and master's and bachelor's degrees in electrical engineering from Harvey Mudd College.

If you are interested in discussing these areas, please post your comments. You can also contact me at allthingsdigital at sbcglobal dot net.