New Developments in the “Digital Lifestyle,” Part 2

Last time, we began to revisit the digital lifestyle race that is well underway in the computer world. We looked at what progress AOL Time Warner and Sony have made since we first talked about this topic last March.

As I mentioned, two trade shows were underway that made this an especially appropriate time to revisit this discussion: the Consumer Electronics Show (CES) and Macworld. The rumor mill was buzzing about several big new announcements, and neither show disappointed. This week, we’ll look at the other two big players in this space: Microsoft and Apple.

Microsoft

Microsoft has developed an extremely annoying habit: announcing new technologies and devices that are in development and won’t be available for a long, long, long time. How many times have we seen Bill Gates demonstrate the TabletPC and promise delivery before the end of the year?

Well, if vaporware is your bag, ol’ Bill delivered big during his keynote at CES this year. The Microsoft executive touted several new initiatives his company is pursuing, under the umbrella of the relatively new eHome division. Perhaps the most interesting component is Mira, software that drives a tablet-like wirelessly networked PC and seeks to bridge the gap between the PC and the TV. Microsoft is banking on the belief that viewers don’t want to clutter up their TV screens with interactive overlays and Web content. So Mira delivers that content to another screen: a device specifically designed to be part personal digital assistant (PDA), part TV remote, and part Internet appliance.

Microsoft seeks to put an XP-powered server at the center of the home network, with things such as the Xbox, Mira, and other XP/.NET devices seamlessly communicating.

If it does ship, Mira might actually fill a niche. Other computer makers have attempted to sell an “Internet appliance,” and all have met with failure. Even 3Com’s Audrey, which sought to be a family PDA combined with wireless Web surfing throughout the house, couldn’t survive for more than seven months. But Mira has an advantage: Some reports indicate that it is specifically designed to complement and enhance TV viewing. And that may be the key.

Microsoft has been trying to make a splash in the iTV world for some time now. Its efforts began, perhaps, with the acquisition of WebTV several years back and have most recently led to the launch of UltimateTV. The company has also been busily trying to work out some behind-the-scenes iTV infrastructure. But rumor has it that ongoing delays for these projects have caused AT&T (which had previously been committed to working with Microsoft’s platform) to rethink its own iTV strategy and look for another partner.

One area in which Bill and company have scored recently is gaming. The Xbox seems to be a hit and has potential to evolve into a home network hub. It is powered by an Intel chip, runs some kind of Windows-based OS, has a 10 gigabyte hard drive, offers an Ethernet port, and plays CDs and DVDs. What (if any) plans Microsoft has for the Xbox beyond video games remain to be seen, but the Xbox certainly has some of the necessary hardware to be a key device. (One clue to the company’s future ambitions may the fact that it chose the generic Xbox moniker for the device, rather than dubbing it something more gaming specific.)

These new efforts from Microsoft seem to really be lending some credibility to the networked home concept. But practically none of the pieces of this puzzle are actually shipping yet. To score big here, Microsoft must reverse its reputation for production delays and find a way to successfully market these new services to consumers — something it has been largely unable to do with WebTV.

Apple

Apple gets it.

This company knows what consumers want: something that’s useful, easy to use, and so elegantly designed that you’re not afraid to put it in your family room. Contrary to what many pundits think, design does matter, and Apple’s industrial design group is on a roll.

Steve Jobs introduced the new flat-panel iMac during his keynote speech this year. The original iMac was perhaps the first-ever computer to be called “cute,” and it launched a revolution in the computer world (and beyond). The incredibly successful machine’s successor seems poised to do the same. Time Magazine even published a cover story on it. Apple is pitching its new machine as the ideal device to be the hub of the digital lifestyle.

Lost in the shadow of this revamp of Apple’s consumer all-in-one desktop machine was the release of iPhoto, free software for managing, printing, and sharing digital photographs.

Apple has almost completed the digital hub vision that Jobs announced one year ago. The company has cranked out some incredible software and hardware. This lineup gives it perhaps the most complete digital hub strategy of any player. The company invented FireWire, which offers incredibly fast transfer speeds and is now a standard on most digital video cameras. It also rolled out iMovie to make digital video easy and fun to work with.

In October, Apple released the stunning iPod MP3 player to rave reviews throughout the industry. The device seamlessly integrates with iTunes, Apple’s desktop software for managing MP3s.

And now, with iPhoto, the only missing piece is some kind of television product. But it’s difficult to tell if the TV will become part of Apple’s strategy. The company has taken a wise approach here. Microsoft’s eHome efforts have been focused on making iTV work, and it has little to show for it. Apple, however, has focused on devices and technology that work today. iTV will be big, but nobody knows when. Digital video, digital cameras, and digital audio are all here today.

Other News

A few other companies are looking to score on the digital lifestyle boom, and several made big announcements at CES.

RealNetworks, for example, announced a deal with TiVo that will see Real’s software attempt to bridge the gap between the TV and home stereo system. Real also announced a similar deal with newcomer Moxi Digital (formerly Rearden Steel Technologies, founded by WebTV entrepreneur Steve Perlman).

Moxi’s Media Center won TechTV’s Best of Show at CES and is making a lot of promises: personal video recorder (PVR), Internet router, digital cable/satellite receiver, jukebox, and DVD player.

The introduction of this technology punctuates the underlying question: Is the digital hub going to be a slim box created entirely for that purpose, or will it be a desktop computer with appropriate software? Only time will tell.

And as a bona fide gadget freak, I can’t wait to find out.

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