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• CES 2007: Motorola aims to raise the level of personalization for...

  Las Vegas (NV) - When Ed Zander took over Motorola in 2004 after resigning as president and COO of Sun Microsystems, few people expected him to revitalize the beleaguered technology company. But thanks to new products like the popular RAZR phone, Motorola's mobile phone market share has increased from 13% to 22% in just a couple of years and its products have come to symbolize the increasing personalization of mobile devices. So why did Zander take the stage at CES riding a yellow bicycle? Cost cutting, he joked. "I practiced that a lot," Zander said. In truth, he used the bike to show how people can store and charge their mobile devices on their bikes today rather than just their cars. That shows just how far mobile communication devices have come, he said. Zander began his keynote by communicating the massive growth of mobile communication devices, saying there are four births per second on Earth compared to 25 mobile phone purchases every second. And more than any other device, Zander said, the mobile device is the most personal consumer technology item in today's world. "Nothing is as personal, and nothing is as ubiquitous as this device," Zander said, holding a Motorola phone. "This is just the beginning." Zander said that new features like digital cameras, MP3 downloads, digital video and Internet on mobile phones are being adopted more quickly than anything he's ever seen in his 25 years in the technology industry, which is helping to make generation devices more personal and intuitive than ever before. He added that the MotoFone, Motorola's recently introduced new phone, is so intuitive that even people who can't read are able to use the phone, thanks to the voice-activated command features. Ed Zander During the keynote, Zander announced a new Motorola partnership with Yahoo! Go 2.0, a new personal Internet service for mobile devices from Yahoo. In addition to search capabilities, the Yahoo! Go service can also deliver personalized news, sports, stock prices and other media. The Yahoo! Go service was indicative of Motorola's strategy to make mobile phones more like PCs. "We're pushing full throttle to get as much on these devices as have on the PC," he said. Among the products Motorola introduced were a wireless Bluetooth-enabled head set with S9 stereo headphones that connects to Motorola phones and also streams digital music; the MOTORIZR Z6, a Linux-based music device; and the MOTOMING device, also Linux-based, which features Motorola's Edge technology to enable high-speed video and entertainment media downloads. All three products are part of Motorola's MOTOMUSIC Experience platform, which includes the above products and newly announced alliances with Warner Music Group and Microsoft for downloadable content. Zander said most of the new products will be available in the first half of 2007.

• At CES, outside of the folks that actually build DVD drives, the action was on movie downloads and the beginning of HD movie downloads. At the event, in the opening keynote, Bill Gates dwarfed a slight mention on HD-DVD and focused much more heavily on "Live," Microsoft's on-line service for entertainment. At the event that eclipsed CES, MacWorld, Steve Jobs, a Blu-ray supporter, didn't even mention Blu-ray and focused, with Disney, on content downloads to the iPhone and the Apple TV instead. In fact there was vastly more activity surrounding on-line movie and TV content delivery at both shows than there was combined discussion on HD-DVD or Blu-ray. Download content is gated by two things, content access (what the studios make available) and band width. For instance it takes me about twelve hours do download a HD move on my DSL service, around four hours for a standard definition movie. As the industry gets better and better with regard to compression the extra capacity surrounding HD-DVD and Blu-ray may become less important. More importantly, many of the people backing both standards are now switching to on-line delivery which could obsolete both offerings for much of the world by year end. Porn industry tries a different approach One of the interesting announcements at CES was that the porn industry was moving to HD-DVD because Blu-ray didn't want them. What many don't realize is that at the same time, CES runs the porn industry has their big show and, in many ways, that industry is actually more profitable. While the Porn industry has also had massive piracy problems, they have focused their technical advancements on enabling a complex channel of on-line delivery outlets in what looks like a muli-level marketing format. People can, with little background, set up an on-line store to sell, legally, content from these studios. These stores specialize in their customers unique needs and, as we understand, can be very profitable while also providing strong revenue streams back to the studios producing content. I often wonder what would happen if the MPAA, instead of treating every legitimate customer as if they were a criminal in waiting, focused on actually selling more stuff like the porn industry does. My sense is they probably would generate more profit and while piracy might also go up, their primary goal should be to increase profit not be another police force. Higher capacity may actually be a disadvantage In addition, last year, according to the studios, enhanced DVD packages (like collector's editions) actually sold better if they had more physical DVDs in them. In several cases, where a dual sided release was followed by a multiple disk single sided product with the same content, people actually returned the dual sided single disk packages for the multi-disk single sided (older technology) product. People felt that more was better and, even though there was no difference in the actual content, bought the older technology disks. The Blu-ray guys in particular really need to look at their own stats on this. If their big advantage is capacity and buyers don't care, that is going to be a problem. But, if we bypass disks entirely, capacity is the least of their worries. Time Warner and LG get impatient Time Warner announced a dual-format disk at CES. This disk, which has to be relatively expensive to make, has Blu-ray content on one side and HD-DVD content on the other. If every studio were to adopt this, it would be vastly better for retailers who currently have to split the content on two shelves and for consumers who will often find the movie they want doesn't run on the player they bought. However, this move would favor the lower cost player, so you would expect the HD-DVD camp will like it and the Blu-ray player buyers won't. If only the HD-DVD side moves to this format, it would actually favor Blu-ray, because it would make more content available for Blu-ray. The fact that the second alternative is the most likely makes this very interesting given Time Warner is generally thought to be in the HD-DVD camp even though they support both formats. LG, on the other hand, announced the first HD-DVD/Blu-Ray combination player with an estimated price of $1200. While clearly expensive, this is some the Blu-Ray players started out and this price should drop. If these players catch on, it would make the whole battle pointless and studios would simply move to the least expensive format, which is HD-DVD right now. Scalers: More convincing Before CES, I had a chance to use a DVD player with a surprisingly good scalar. The Oppo DV-981HD provided an impressive picture on a HD display and I ran it against both Blu-ray (PS3) and HD-DVD (Xbox) content. While the true HD content obviously was a little better (except for some of the poorly done Blu-ray movies, which were actually worse), if you didn't have the displays side by side you likely wouldn't notice the difference. In effect, the Oppo is an expensive DVD player at $230, but an inexpensive alternative to the HD players which will cost you at least twice as much. And don't forget, this DVD player makes all the DVDs you already have look better. At CES DVD players, TVs, and monitors with good scalers were all over the place. Gateway started selling monitors last year with a similar scaler to the one Oppo uses built in, Dell announced a 27" monitor with a very strong scaler built in as well, suggesting this trend is going well beyond just TVs and DVD players (scalers in monitors allow you to get better images from lower cost graphics cards and notebook computers). One interesting fact is that the Xbox 360 has a built-in scalar, while the PS3 does not. As a result, DVD movies played on an Xbox 360 are likely to look better than if they were played on a PS3. While not in the same class as the Faroudja scalar used by Oppo, the Xbox 360 version does improve how a DVD or older game looks on an HD set and is one of the advantages the Xbox has and we don't talk about much. With more and more content coming from services like YouTube scalers increasingly become important because, without scalers, these videos will look like crap on our HD TVs. In addition much of what we currently have is standard definition and no one really wants to re-buy all of their movies. Not if they have a choice and scalars give you that choice. So, my view of CES is - regardless of HD-DVDs market leadership, and Blu-ray's better marketing - standard DVD with an up-converting scaler is the technology that makes the most sense right now. Rob Enderle is principal analyst for the Enderle Group. He can be reached at renderle@enderlegroup.com.

• We know, no one wants to talk about digital rights management (DRM). But as inconvenient as it may be, I simply have to. DRM has evolved into one of the most spectacular euphemisms in the IT and entertainment industry. Today's concepts that describe DRM do not deserve that name. What about "content access restriction management" instead? Here's what is happening: Content owners and technology firms need to get together to enable what is believed will be the next big growth opportunity for the entertainment and IT industry. Technology companies are starving to make video content available to their customers, but many content owners typically have little faith in new technologies after they have seen what can happen if technology has its way (see the original Napster.) Content firms, sitting on a potentially unlimited revenue opportunity of "premium" content, have the upper hand in this game. Which means that content firms determine how content is accessed and how you can use it. There is nothing wrong with this picture if you consider the huge investments in the production of music and films; but some firms appear to have a somehow distorted view of fair use of content. With more and more digital content and DRM becoming available, we are finding ourselves in a trial-and-error situation - an environment where content owners are testing how much DRM we are willing to accept. Probably one of the more visible versions of DRM deployed today are movie download services such as CinemaNow and MovieLink. On CinemaNow, you can download movies for prices up to $15, but the content is not intended to be moved around the house: Some movies may play on one PC, others on up to three PCs. Maybe I am missing something here, but if I am paying for a download pretty much as much as I would for a DVD, I want to be able to burn it onto a DVD and I want to play it on any DVD player in the house. A three-PC restriction is ridiculous. How to playback downloaded Movielink movies on multiple PCs. Remember the times when you didn't need a manual to watch a video? MovieLink, a joint venture of Metro-Goldwyn-Mayer Studios, Paramount Pictures, Sony Pictures Entertainment, Universal Studios and Warner Bros. Studios, charges up to $20 for a movie. These movies can be played on up to three PCs as well, but every new PC that plays the content will have to be logged on to the Internet and needs to be authorized by MovieLink. Content can be burned on CDs and DVDs, but cannot be played on regular DVD players. MovieLink recently acquired a license for a technology that would allow customers to burn a downloaded movie onto a DVD and play it on a regular DVD player, but it is unclear when such a deal will be available and how much it will cost. Given the fact that movies are already priced at $20, quite frankly, it should be free. HD content will be a whole new topic as technologies such as HDMI and HDCP ("High-Bandwidth Digital Content Protection") are adding additional hurdles and inconveniences for the consumer. Gladly, there are some positive signs that DRM may be heading into the right direction. In an interview earlier this year, Jerry Pierce, senior vice president of technology at Universal Pictures, told us that his company is fully aware that DRM will not stop piracy, but is rather aimed at preventing mass-piracy. "I don't think DRM is about a certain technology, DRM is about usage rules. If consumers purchase an HD version of one of our movies and if they make a same quality copy and they can hand that to their friends - and if that was easy to do - they cross the line." In regards to private copies, Pierce said: "A properly controlled private copy, with a version that runs on the consumer's hard drive and their media server, yes, I believe that there should be ways to enable that." The Internet is full of examples that consumers are willing to accept reasonable content protection mechanisms in exchange for ease-of-use and the simple request for multi-device playback (see "iTunes"). But in its current state, exaggerated DRM is without any doubt one of the major reasons why, for example, digital movie downloads are simply no replacement for regular DVDs.