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"Intel Inside" your next TV?

By John K. Waters

Intel Corp. president and CEO Paul Otellini added his company's name to an expanding roster of industry heavyweights making major moves into the market for home entertainment devices at last week's Consumer Electronics Show (CES) in Las Vegas.

The Palo Alto, Calif.-based company is planning to move "from inside the computer to inside the home and consumer electronics products," Otellini said, providing chips for a wide range of devices, from televisions to portable media, as well as an emerging species of PC designed to serve as a home-based digital media hub.

"Over 350 million digital devices will be sold into the home this year," Otellini told his audience. "About 1.5 billion devices will be sold between 2004 and 2006. In many ways, it's a larger market than the PC. The lines between the [computer and CE] industries are blurring. Consumers are demanding change inside their homes. We all want to have multiple video streams."

Otellini clarified Intel's plans to establish itself in the digital television market, rumors of which began to circulate in December. He confirmed that his company has created a new division, the Intel Consumer Electronics Group (CEG), to spearhead its CE activities. Intel plans to invest $200 million in companies making digital consumer products, Otellini said.

Among other initiatives, Intel is now making a new line of liquid crystal on silicon (LCOS) chips, code-named Cayley. The new chips are designed to allow manufacturers to make the latest rear-projection television sets thinner and cheaper, Otellini said, by moving much of the electronic complexity of the devices into the silicon. Sets equipped with the new LCOS chips should begin appearing by the end of this year, he said. LCOS technology competes with LCD displays and Texas Instruments' Digital Light Processing technology.

"We think that in 2005 an LCOS-based 50-inch HDTV will be sold for less than $1,800," Otellini said. "This will change big-screen economics."

Intel also threw its weight behind the so-called Entertainment PC (EPC) with "Gransdale," a new chipset designed to allow desktop PCs to become wireless access points. The EPC represents a new category of products that focuses on content storage, and replaces the traditional keyboard with a remote. The EPC includes wireless capabilities and combines a digital audio player, digital video recorder and high-definition television (HDTV) tuner into one device.

Otellini showed off several new portable media players that use Intel's XScale chips, which were previously found primarily in personal digital assistants. The chips will allow manufacturers such as Creative Labs and Samsung to build portable media players that can handle both audio and video, he said.

Virtually all of the keynotes at this year's show included celebrity endorsements, and Otellini's presentation was no exception. Actor Morgan Freeman joined the Intel president on stage to talk about cooperation between Intel and Freeman's studio, Revelations Entertainment. Freeman said his studio plans to release its next movie online and in the theater at the same time. "We want to be proactive because we firmly believe that if we do this right, it's going to be the next biggest thing," Freeman said.

The Otellini presentation also provided attendees with yet another video send-up of the popular television show, "Queer Eye for the Straight Guy." (Carly Fiorina showed one during her keynote). In this version, dubbed "Digital Eye for the Analog Guy," a group of techies descends on the home of a middle-aged couple to give them a technology makeover.

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