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October 30, 2002—In this issue:
1. GETTING CONNECTED
- Video-Game Wars 2002
2. NEWS AND VIEWS
- Radio Goes Digital
- Creative Launches "iPod Killer"
- Ballmer: No More Xbox Down Under?
- Xbox Brings Back Classic Tradition
- Europeans Get Smartphones; Americans Get Squat
- Americans Online
- Microsoft and Panasonic Create New Format
- New ReplayTV Devices Feature More Recording Time
- OpenTV to Lay Off Nearly Half of Staff
- Attend Our Free Tips & Tricks Web Summit
- Get Connected with Connected Home
4. QUICK POLL
- Results of Last Week's Poll: Media Center PCs
- New Poll: Holiday Video-Game Buying
- Tip: Optical Drive Confusion? Get a Combo Drive
6. NEW AND IMPROVED
- 5 New Displays from Samsung
- Capture and Store Digital Images
7. CONTACT US
- See this section for a list of ways to contact us.
1. GETTING CONNECTED
By Paul Thurrott, News Editor, firstname.lastname@example.org
No market in the consumer electronics industry has more at stake this holiday season than the hotly contested video-game market, which Microsoft, Nintendo, and Sony dominate. PC and video-game titles generate more than $25 billion a year—more than all Hollywood movies combined. That's as much money as the entire toy business and greater than the gross national product of many countries. With year-over-year growth of 120 percent from 2000 to 2001, video games have bucked economic trends and logged record sales in one of the toughest financial climates in history. With that much money on the line, holiday season 2002 will be one of the most closely watched selling seasons ever.
From a consumer standpoint, today's video-game systems are unparalleled. Sony's PlayStation 2, Microsoft's Xbox, and Nintendo GameCube offer processing power and graphics quality that match the mightiest PCs and interactive experiences that surpass content available in other media. The systems are inexpensive, too—about $200 for the PlayStation 2 and Xbox and $150 for the GameCube. But games for the systems aren't cheap: New mainstream titles typically cost about $50 each, although you can find bargains on last year's titles and other games.
But how do you decide which system, if any, to buy? First, consider versatility. The PlayStation 2 doubles as a DVD player, although you need to purchase a remote control (about $30). The Xbox can also play back DVDs, although the device requires a DVD adapter kit, which includes a remote (also about $30, although Microsoft has a deal right now that essentially gives you the kit for free). The Xbox includes networking capabilities, and next month Microsoft will launch an online service, Xbox Live, that costs about $50 a year. Sony has also launched an online service of sorts, but the Sony service isn't centralized the way the Microsoft service is (i.e., each game has to handle online features individually) and requires a separate, hard-to-find network adapter that costs about $50. I'm evaluating the online prowess of the PlayStation 2 and Xbox and will report back by the end of the year.
A second way to judge the systems is by their capabilities. Technically speaking, the Xbox is the king, with a PC-like CPU, 64MB of RAM, 8GB to 10GB of hard disk space, 3-D video adapter, and networking capabilities. The machine also includes four game-controller ports, which are key for multiplayer gaming and especially fun for sports titles. Coming in second place is the PlayStation 2, with an Emotion Engine graphics processor. The Sony machine lacks hard disk storage and features only two game ports, although you can purchase a separate port expander for about $40. The Nintendo device features an ATI-based graphics processor and an IBM PowerPC processor but also lacks a hard disk; it does feature four built-in game ports, however. All three systems are quite capable. I doubt that any user would find any of these systems underpowered or graphically poor. All feature high-end 3-D chips, decent processors, and high-speed action. But if bragging rights are important, the Xbox is the system of choice.
Another important criterion is game availability. The Xbox and GameCube originally focused on niche markets—mature adult-oriented games and children's games, respectively—but have since adopted Sony's broader strategy of catering to all gamers. Still, Sony seems to have a much wider and deeper catalog of titles, and if you have a range of gamers to keep happy—children and adults—the PlayStation 2 might be your best choice.
But each system is well represented by software titles. On the GameCube, Super Mario Sunshine, Resident Evil, and Eternal Darkness: Sanity's Requiem are popular, with Nintendo describing the latter as an innovative psychological thriller in which players use dwindling "sanity meters" that cause them to question their grasp of what is real and what’s illusory. Sony boasts excellent sports, action, and racing titles, including such games as the ultraviolent Grand Theft Auto III, Metal Gear Solid 2: Sons of Liberty, and Gran Turismo 3: A-spec. On the Xbox, companies under Microsoft's umbrella publish many of the best games, such as Halo, NFL Fever 2003, and Project Gotham Racing. Some games, such as the best-selling sports title Madden 2003, are available on two or more systems. And PlayStation 2 and Xbox owners can soon buy The Two Towers, a faithful adaptation of the upcoming movie.
Finally, you might consider market share when shopping for a new system. With 40 million units sold, Sony is the runaway market leader. Microsoft had sold only 4 million Xboxes by June 2002, but the company says it will sell 10 million to 11 million units by the end of the year. Although Nintendo hasn't issued any recent sales figures, IBM, which supplies the GameCube's PowerPC processor, revealed this week that it has shipped 10 million processors to Nintendo. And Nintendo says it's on track to ship 16 million GameCubes by the end of 2002. Sony obviously dominates the video-game market, leaving Nintendo and Microsoft to pick up the slack. Is the market big enough for three players? Maybe not in the past, but with more than $25 billion at stake this year, Microsoft, Nintendo, and Sony are all in it for the long haul.
Less certain is the fate of third-party software developers, many of whom can't afford to develop titles for two or more systems. With Sony increasing its already huge lead, many of these game makers will simply decide to create PlayStation 2 games and ignore the Xbox and GameCube. For this reason, combined with the PlayStation 2's expandability and depth of software, I have to choose the PlayStation 2 as the system to own in 2002. But that opinion doesn't mean that the Xbox and GameCube are losers, per se. As I noted, both systems are capable. In the end, no choice is bad, and all three systems offer years of cutting-edge entertainment and interactivity.
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2. NEWS AND VIEWS
(An irreverent look at some of the week's Connected Home news, contributed by Paul Thurrott and Keith Furman)
The FCC has approved a digital technology format that will let radio stations begin to convert their signals from analog to digital broadcasts. The technology, called HD Radio, is similar to the quality that satellite radio providers such as XM Radio and Sirius Satellite Radio offer. The technology, in fact, will enhance FM radio signals to CD quality and AM signals to the quality of today's analog FM signals. HD Radio will also let broadcasters send out text information with their broadcasts; that information will likely include information about the song that's playing as well as news, weather, and stock quotes. But don't throw out your current car radio just yet, because the conversion is expected to take several years. Fortunately, the format also provides support for broadcasters to continue to offer analog signals bundled with digital signals for people who don't yet have digital radios. Eh. Luddites.
This month, Creative Labs released Jukebox Zen, which will attempt to dethrone Apple Computer's iPod as the coolest music player on the market. The Jukebox Zen matches the features of its bigger CD-player-sized brother, the Nomad Jukebox 3, but is much smaller; the Jukebox Zen is still quite a bit larger and heavier than the iPod, however. The Jukebox Zen features 20GB of storage and supports Microsoft Windows Media Audio (WMA) format, in addition to MP3. It's also less expensive than the iPod, but definitely not as cool. Will the Jukebox Zen give Apple a run for its money? Time will tell, but other iPod rip-offs have failed miserably in the market.
A Sydney newspaper recently reported that an Australian court decision that legalizes mod chips has Microsoft CEO Steve Ballmer questioning the Xbox's continued availability in Australia. The court ruling concluded that mod chips for gaming systems don't violate copyright rules that outlaw devices intended primarily to bypass copyright-protection technology. Microsoft, Nintendo, and Sony rely on revenue from games for their video-game systems to help subsidize the cost of the system hardware. Mod chips let crackers easily run unauthorized programs such as homebrew software and pirated games. A Microsoft spokesperson claims the newspaper misquoted Ballmer, but the company will closely follow the appeal to the court's decision.
Speaking of Xbox, Microsoft has come up with a new promotion to help ignite holiday sales of its game system. Remember the good old days when you bought a video-game system and it actually came with a game? Well, Microsoft is bringing back that tradition, and the company is including two free games, not just one. This holiday season, all Xboxes will come with Sega's GT 2002 and Jet Set Radio Future titles. These games cost $50 each and make the $200 price of the Xbox a bargain, assuming you would have purchased either game. Although this move might be too little too late to help Xbox catch up with Sony PlayStation 2's enormous lead, we suspect it will help sell a bunch of Xboxes this holiday season.
Microsoft has finally released its long-awaited Windows Powered Smartphone OS for cell phones. The software, which is now available in Europe, brings advanced PDA features, such as contacts, calendar, Instant Messaging (IM), email, and Web browsing, to cell phones. Cell-phone provider Orange was the first to release a Smartphone device, dubbed the Orange SPV. The phone will retail for 179 pounds (about $277) and will include an add-on camera and a USB adapter to simplify computer synchronization. Microsoft says that manufacturers will release Smartphones in the United States by mid-2003.
According to a new study, 61 percent of Americans now use the Internet, compared with 59 percent at the end of 2001. The study broke down usage into the amount of time people spent online: Of those interviewed, 35.3 percent went online daily, 14.9 percent several times a week, 5.4 percent about once a week, 5.2 percent once a month, and 6.2 percent less than once a month; 33.1 percent had never been online. Although consumers are shopping online, communication and game playing are the most popular online activities. And according to the study's conclusion, consumers still don't trust the Internet. Only 21.2 percent trusted the safety of their online personal information, such as credit cards. Shopping statistics showed that just 6.8 percent of consumers surveyed spent more than $1001 online in the 3 months before the survey. The majority, or about 23.9 percent, spent just $51 to $100 during that quarter.
Microsoft and Panasonic are hoping a new format will help enhance digital-media usage between PCs and consumer electronics devices. The two companies have jointly developed a new technology called High-performance Media Access Technology (HighM.A.T.). CDs and other media created with the format will still be readable by existing devices, but HighM.A.T.-enabled devices will be able to identify enhanced features, such as playlists, music metadata, and folders with photos or videos. Microsoft will add support for this technology to its Windows Media Series 9 products, and in 2003 consumer electronic companies such as Fuji and Panasonic will release devices that use the technology.
SONICblue has released an update to its ReplayTV line of digital video recording (DVR) devices. The new Series 5000 includes four units that vary in storage size and price. The four units are the 5040, which is $299.99 and can record as many as 40 hours of shows; the 5080, which is $399.99 and can hold as many as 80 hours; the 5160, which is $499.99 and can store as many as 160 hours; and the 5320, which is $899.99 and can store as many as 320 hours. All the units require a subscription to ReplayTV's service, which costs $9.99 a month or a one-time fee of $250. The recorders are available in Best Buy retail stores and directly from SONICblue.
Microsoft isn't the only company having problems with interactive TV. OpenTV, one of the biggest interactive TV software developers, has announced plans to lay off 315 employees—about 47 percent of its work force. The company cited the weak economy and a desire to streamline its operations as the reason for the layoffs. The slow rollout of interactive TV services by cable providers has also seriously hurt the company. Our dream of using the TV for movies on demand and interactive online services still appears to be years away, but we can't help but think that this market is waiting to explode.
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4. QUICK POLL
The voting has closed in Connected Home Online's nonscientific Quick Poll for the question, "Are you interested in the new Media Center PCs, such as the one HP offers?" Here are the results (+/-2 percent) from the 165 votes:
- 10% Yes, I plan to buy one
- 46% Yes, but I don't plan to buy one anytime soon
- 44% No
The next Quick Poll question is, "Will you purchase a video-game system this holiday season?" Go to the Connected Home Online home page and submit your vote for a) Yes, a Sony PlayStation 2, b) Yes, a Microsoft Xbox, c) Yes, a Nintendo GameCube, d) Yes, but none of the above, or e) No.
(contributed by Paul Thurrott, email@example.com)
Because many people have a growing need to use both DVD and recordable CD media in their PCs, many computer owners are adding separate DVD and CD-RW drives to their systems. But a growing market for combination drives, which read both DVDs and CD-ROMs and write recordable CDs, lets you get both capabilities in one drive. These drives are available for both desktops and laptops and, in the case of desktop systems, free a valuable IDE position for another hard disk. Sony is now offering what might be the ultimate combination drive for desktop systems—a $350 drive that offers compatibility with DVD and recordable CDs, but also with all popular recordable-DVD formats, including DVD-R, DVD-RW, DVD+R, and DVD+RW. You really can have it all.
Got a question or tip? Email firstname.lastname@example.org
6. NEW AND IMPROVED
(contributed by Jason Bovberg, email@example.com)
Samsung announced five new LCD, CRT, and plasma displays. The SyncMaster 171N is a 17" narrow-bezel LCD monitor; the SyncMaster 172T is a dual analog/digital-input 17" LCD monitor; the SyncMaster 172B is a multimedia-enabled 17" LCD monitor; the SyncMaster 957mb is a 19" CRT monitor; and the PPM63H1 is a 63" High-Definition Television (HDTV)-capable plasma display. For more information, contact Samsung on the Web.
Olympus America announced the W-10, a digital voice recorder with a 0.3 megapixel CMOS sensor that captures VGA-quality images. You can use pictures to reference and organize your digital voice recordings. You can make instantaneous audio/visual recordings and create slide shows. The W-10 connects to PCs through a high-speed USB interface, so you can quickly upload and download .wav audio and .jpeg image files to and from your PC. The W-10 has 16MB of built-in flash memory. To maximize use of recording time and conserve battery power, the W-10's Variable Control Voice Actuator (VCVA) ensures that recording begins only when it senses sound. The W-10, which costs $99, comes equipped with a USB cable, Voice Album software on CD-ROM, earphones, hand strap, soft case, and two AAA batteries. For more information, contact Olympus America at 631-844-5000 or on the Web.
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