Opinion
The interface for digital content in the home

There's an exciting competition going on in the technology/entertainment world. It's the race to see who will prevail in becoming the pervasive interface to digital content in the extended home. Will the victors be the computer-centric hardware and software manufacturers, or the consumer product-centric manufacturers? In between them both are the broadband ISPs and cable television companies who stand to gain in either case.

On the one side you have Microsoft announcing alliances with media companies. On the other side, you have Sony Predicting the rebirth of television.

At the January Consumer Electronics Show (CES), Microsoft said 11 new companies have bought into its new High-performance Media Access Technology (HighMAT), which makes it easier to move digital content between PCs and electronics devices such as CD players, car stereos and DVD players.

The software was co-developed by Panasonic and Microsoft, which introduced the product in October with plans to license it and incorporate it into their own products. Fuji Photo Film was the first company to license the product. Microsoft includes the technology in its Windows Media Player 9 and its Windows Movie Maker 2 for XP.

Microsoft software also ties into 40 more devices that now support its Windows Media format, pushing the number of Media-compliant CD players, car stereos and other portable devices to more than 200. Companies producing new DVD players with Windows Media Audio support included Apex Digital, JVC and Toshiba. In addition, Polaroid unveiled the first new DVD player to support Windows Media Video.

On the other hand, Sony is trumpeting a new era for the television and entertainment connectivity on Linux-based software. Sony's televisions have always played a major role not only in its success as a company but also in boosting its brand recognition. At the January CES, Sony President and Chief Operating Officer Kunitake Ando predicted the rebirth of the television as he touted new products and strategies that will guide the company throughout the year.

"The first 50 years of color television was just the infancy stage," Ando said. "The PC has been a champion in the industry. But now the television is about to be reborn."

Ando said that future televisions will be the center of home entertainment networks, allowing consumers to access data and services found on other devices connected to the network.

The strategy for televisions echo similar efforts by Sony to connect all of its products to networks, letting customers access the company's vast supply of entertainment content such as music and movies. Other technology and consumer-electronics companies, such as Microsoft, Intel and Philips, have recently begun exploring similar plans.

One of the major obstacles for Sony and others working to establish networks and make content more widely available has been the relatively slow adoption of broadband access, but Ando noted that broadband is becoming more popular in countries such as Korea and Japan and is beginning to pick up subscribers in the United States. Ando said Sony will also work to use open standards in future products to make it easier for consumers to more widely access content on devices and urged other companies to help to establish these standards to help the industry progress.

"The pieces are coming together...the broadband wave will wash over us, and it is coming fast. My message is we need to collaborate now in order to realize our broadband dreams," he said.

To champion their brand of the connected home, Sony is producing a substantial collection of consumer electronics: One advantage to being the world's largest consumer electronic companies.

The company's offerings include new notebook and desktop PCs that support multiple DVD-burning formats. Sony's handheld Clie has a new release dubbed the PEG-NZ90 to serve as a bridge between smaller Sony devices, such as digital cameras and the company's Vaio PCs. Their new Memory Stick Pro Media will store all that entertainment and a host of other products from camcorders that use DVD-rewritable technology to new Sony Walkman music players will record it all.

Sony also announced it will launch two products in the United States that have already been available in Japan. The company's U.S. release of its home networking device RoomLink is expected in the spring, and its digital video recording device CoCoon will come later this year, depending on when Sony can establish a DVR (digital video recorder) service.

Extending the connectivity of the key components in the digital home is the current objective and one that holds the promise of the next wave in the New Economy. Applying Warren Buffett's 12 tenets to the key players on each side proves an interesting if not productive exercise in creating an educated opinion on how the field may develop.