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Sony beat everyone else to market with the OLED television, a format that is seen as the future of displays. (Peter Nowak, CBC) Sony beat everyone else to market with the OLED television, a format that is seen as the future of displays. (Peter Nowak, CBC)

In Depth

Technology

CES a gamble for electronics makers

As another annual convention winds down, some firms are going home as winners and some as losers

Last Updated January 10, 2008

LAS VEGAS — The majority of visitors to Sin City come here for one reason and one reason only: to gamble. There are some winners, but also many more losers. It's no different with the companies that come here for the annual Consumer Electronics Show (CES).

Indeed, just like the thousands of people gambling at the card tables and slot machines every day, electronics makers can also win or lose their fortunes in Las Vegas.

Many of the show's 140,000 attendees, tired and bleary-eyed from the frenetic pace of the mega-convention, and its crowds, bright lights and blaring sounds, headed home on Wednesday night, leaving CES to wrap up for another year on Thursday.

After a whirlwind four days of press conferences, product announcements and constant promotion, CES produced a number of winners. And, of course, there were losers.

Here's a rundown of who won, who lost and who the verdict is still out on.

Hitting the jackpot: Sony, GM, Philips

Sony has had a tough few years, with the once innovative company missing the boat on a number of significant consumer electronics trends. Sony, which owned the personal music player market with the Walkman, completely ceded that business to Apple by sleeping at the wheel with MP3 players. The company was also once the dominant television provider, but squandered that advantage to others such as Samsung and Sharp by dragging its heels on flat-panel televisions. Sony also gave up ground to Microsoft in video games by failing to anticipate the demand for online capability.

More than ever, Sony has been in need of a hit — and it got two at this year's show.

Shortly before the CES began, Warner Bros. announced it was siding with the Sony-backed Blu-ray next-generation DVD standard, driving a stake into the heart of the competing standard, HD DVD. With most of the major movie studios now backing Blu-ray and accounting for more than 70 per cent of all films released, many industry observers say the future for HD DVD is bleak.

The jury is still out on whether ultra-portable computers, which use Intel's Menlowe chips, will catch on with consumers. (Peter Nowak, CBC) The jury is still out on whether ultra-portable computers, which use Intel's Menlowe chips, will catch on with consumers. (Peter Nowak, CBC)

With the fear of ending up with this era's version of the Betamax VCR gone, analysts say consumers are more likely to snap up Sony's Blu-ray players — not to mention Sony’s PlayStation 3 video game consoles — this year.

If there is a downside to the apparent end of the format war, it's that a new battle may emerge with Blu-ray versus downloadable movies. Several companies, including Microsoft Corp., announced at the CES new or enhanced movie downloads, leading analysts to question whether Blu-ray could be the last physical format for movies.

Sony also scored points by announcing the first commercially available Organic Light Emitting Diode television. Each pixel in an OLED display is individually lit, which creates deeper blacks and eliminates the need for a backlight. That allows TV makers to drastically cut the thickness and weight of the television.

While other manufacturers, including Samsung, had prototype models on the show floor, only Sony went so far as to make them available at retail. The TVs are unlikely to sell, as the screens are only 11 inches and cost $2,500 US, but beating its competitors to the punch is expected to give Sony back the innovation bragging rights it has been lacking for years.

General Motors scored similar innovation points by not only being the first automaker to host a keynote address at CES, but also by announcing a raft of developments in fuel technology, as well as upgrades to its in-vehicle communications and monitoring system, OnStar.

Chief executive officer Rick Wagoner on Tuesday painted GM as an innovator by showing off the company's various efforts in fuel cells, electric and hybrid vehicles. He also announced that OnStar would soon be making its way onto mobile devices, which will allow customers to unlock or start their cars with their cellphones.

GM also wowed attendees with its self-driving vehicle, designed by engineers from Carnegie Mellon University, which won a robot car road race last fall. The car uses advanced radar, laser sensors and GPS systems to drive itself, prompting company executives to predict that full robot cars will be on the streets within the next 10 years.

The buzz at CES was that GM's performance was a big victory for the company, and there are now expectations that other automakers will jockey for a position at next year's show.

One of the other major themes of the show turned out to be design. With so many consumer electronics firms churning out similar products, some makers — such as Philips — have decided to use style and design to differentiate themselves. Philips has taken an Apple-like approach with its sleek and minimalist designs, such as curved televisions that emit a backlit glow when hung on a wall, and established itself as perhaps the only major manufacturer that is catering to female buyers with devices such as USB drives disguised as jewelry.

CES attendees weren't sure if the strategy will translate into sales, but many agreed Philips has done a good job in differentiating itself from the others.

50-50 odds: Intel, Panasonic

Microprocessor maker Intel Corp. took several big chances at the CES by announcing it was finally shipping WiMax chips this summer, and that it was pushing the category of ultra-portable computers.

WiMax, or Wi-Fi on steroids as it has come to be known, with its promise of fast wireless broadband speeds at long ranges, has been touted for years as the saviour to all sorts of internet access problems. It was supposed to arrive years ago, but its delay prompted many pundits to wonder if the technology would ever be ready for prime time.

By announcing that laptops will have embedded WiMax-receiving chips starting this year, Intel says it is time, but the jury is still out as to whether that is the case or not.

Ultra-portable PCs, meanwhile, is something that has been tried — and failed — several times. The reasons for the failure have been numerous — devices have had limited usefulness, poor battery life and high prices. Intel says all of that has been fixed, with some models selling for less than $1,000, but analysts say there's one problem that can't be solved — the fact that consumers have thus far been reluctant to carry yet another gadget with them. With a slew of portable internet devices, including ever-improving smartphones such as Apple's iPhone, many are wondering if there really is a market for ultra-portable PCs, or if Intel is merely trying to invent one.

The other major theme of this year's CES was wireless connectivity — not just internet access, but device-to-device communication. Many manufacturers are still searching for the holy grail of electronics, or the elimination of all the wires needed to connect gadgets to each other, and Panasonic is one of the heavy betters. The company announced plans to release a slew of wireless devices, including digital cameras, camcorders, televisions and DVD players, over the next year. The question on everyone's mind at the show was: Will these devices work like they're supposed to?

J.W. Park, president of Samsung's digital media business, showed the technology was far from perfect at his company's press conference on Sunday. He had trouble connecting a wireless camcorder to a television, which was less than a metre away, prompting him to quip: "Just a minute, I'll call a technician."

Crapping out: Toshiba, Microsoft, Yahoo

The Warner Bros. announcement on Blu-ray put a significant damper on Toshiba's show, forcing the company to scrap many of its plans for the year. At its press conference on Sunday, Toshiba limited its product announcements to its television set lineup. HD DVD players, as well as laptops housing the players, weren't mentioned and reporters weren't allowed to ask questions.

The company is now stuck in the position of having to pick up the pieces of HD DVD and salvage some sort of use for the format and the heavy investment that went into it.

Microsoft also lost out through the Warner Bros. announcement, but the company's support for the HD DVD has been pegged as half-hearted at best. Microsoft had opted to offer an HD DVD drive as an optional add on to its Xbox 360, rather than add cost to the video game console by building it in. This now leaves the company free to issue a new Blu-ray add-on drive.

Still, Microsoft's big loss at this year's CES was chairman Bill Gates, who gave his 12th and last keynote speech. Though no replacement was named — nor is it known if next year's keynote will even be given by someone from Microsoft — company executives believe it will be chief executive officer Steve Ballmer. Still, Gates and his trademark nerdy humour had become a staple of the CES, with many attendees coming specifically to see him. Some may choose to stay home next year.

Microsoft did not have any major news to announce this year, unlike last year when it was promoting its Windows Vista operating system. Many attendees thought that was a good thing, given the consensus that Vista has been a flop.

The software company's only notable announcement was the pending Canadian availability of the Zune MP3 player, coming in the spring. However, the device's launch is expected to be underwhelming given that the online Zune Marketplace — where consumers can buy music — won't be accompanying the player because of licensing issues with record labels.

Also underwhelming at the show was Yahoo, which announced it was opening up its "cellphone" widgets and advertising system to third parties. While some useful applications are expected to come out of the plan, such as the improved ability to make eBay bids from a cellphone, the effort was seen as miles behind what Yahoo's chief rival Google Inc. is doing.

Google drew rave reviews last year when it announced an alliance of major technology and wireless companies that would use its open-source Android software to improve the internet experience on cellphones. The company's plan has appeared focused on transforming regular phones into smartphones that can surf the internet and use features such as GPS.

Yahoo's plan, however, seemed to focus on simple cosmetic improvements to the mobile surfing experience as it exists on simple cellphones today. The company's approach was panned as short-sighted and another example of why it has fallen so far behind Google in internet search and advertising.

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