CES 2009

A CES attendee checks out LG Electronics' 3D LCD TV.

(Credit: Marguerite Reardon/CNET News)

Three-dimensional TV is coming to a living room near you. But will the technology spur a consumer spending spree like digital and high-definition TV did before it? Or will 3D end up being the next big flop?

One thing is clear, TV manufacturers need something new to get people buying TVs. Over the last couple of years, TV manufacturers have experienced a sales boom as consumers upgrade to digital TVs in anticipation of the government's mandated switch to digital TV broadcasts in February 2009. Eager shoppers have also been upgrading to high-definition TVs as movie studios, cable and satellite operators, and TV broadcasters have begun offering more programming in HD.

But as the economy worsens, the forecast for the TV market is looking grim. The LCD TV market is only expected to grow about 17 percent in terms of units shipped in 2009, according to research firm DisplaySearch. This is down from growth of about 29 percent in 2008. Plasma TV growth is also expected to suffer with the market only expected to grow by about 5 percent in 2009 compared with a 24 percent rise in 2008, DisplaySearch said.

As a result, TV makers are looking for the next hot thing to attract new consumers. And some are hoping 3D TVs could be it.

At this year's Consumer Electronics Show in Las Vegas, four of the top selling TV manufacturers--Samsung Electronics, Sony, LG Electronics and Panasonic--showed off their latest versions of 3D TVs. Panasonic set up a mini-home theater where its 103-inch, plasma 3D screen showed clips from New Line Cinema's Journey to the Center of the Earth and Walt Disney Pictures' animated film Bolt. They also showed high-definition 3D footage from NBC's broadcast of the 2008 Summer Olympics in Beijing.

While some manufacturers, such as Mitsubishi, Phillips, Samsung, and Sharp, have already begun selling 3D-ready TVs, the top four manufacturers plan to have new, advanced 3D TVs on sale toward the end of 2009 and into 2010.

But the big question is whether consumers, particularly American consumers, will be willing to upgrade to a new TV just because it has 3D. Pricing for today's 3D ready TVs is comparable to other flat-screen HDTVs. Samsung and Mitsubishi currently sell their 3D-ready TVs for between $1,000 and $2,800, depending on functionality. These prices are in line with average prices for HDTVs that don't offer 3D readiness.

Keisuke Suetsugi, a manager for the audio visual center at Panasonic, believes that even the newer, more advanced 3D TVs will not cost much more than TVs without 3D. So for consumers already in the market for a TV, adding 3D readiness might not add much cost. But will 3D be enough to compel cutting-edge consumers to replace their 2- or 3-year-old TVs? That's what TV manufactures are hoping.

Three-dimensional movies have been around since the 1950s. And for most of its lifespan the technology has been seen more as a gimmick than something that truly enhances the movie-going experience. But newer technology and advanced special effects are helping 3D movies break into the mainstream.

TV makers believe that much of the demand for 3D will come from Hollywood, which is pushing 3D in a big way. Last year, DreamWorks announced that all its films will be produced for 3D production beginning in 2009. The company has partnered with chipmaker Intel to build processors that will help make 3D in the home a reality.

NBA basketball fans watch a live 3D broadcast of Game 2 of the 2007 NBA finals.

(Credit: NBA)

Sports leagues have also been experimenting with 3D technology. Both the National Basketball Association and the National Football League have broadcast events and games in 3D to movie theaters.

From a technical standpoint, the technology is available and mature enough today to make 3D TVs available at a reasonable cost to consumers. But there are still a few drawbacks that could prevent 3D TV from becoming the next big thing in home entertainment.

For one, to get the really cool, immersive 3D experience without getting a massive head-ache, consumers will have to wear special glasses when they're watching TV in 3D. The glasses are needed because 3D imaging requires sending a different image to each eye. And the glasses help merge the images in the mind and trick the brain into thinking that it's seeing a single 3D image.

I checked out Panasonic's home theater in 3D. I must admit, the experience was phenomenal. I felt like I was on the floor at the Olympics opening ceremonies in Beijing right alongside the hundreds of dancers and drummers. But without the glasses, the image looked fuzzy.

Panasonic's Suetsugi admits that in a perfect world, consumers should be able to have the immersive 3D experience without wearing glasses. But he said that it will be at least 10 years before the technology is advanced enough to provide a similarly robust 3D experience without glasses.

"Glassless 3D would be ideal," he said. "But it's just not possible to do that now and get the same quality experience. You would need at least 50 times more pixels to get a display to provide the same 3D experience that we provide with our TV. We are still 10 years away from that kind of technology."

Taesoo Park, a chief research engineer at LG, which makes 3D display monitors for advertising and digital signage, agrees. LG plans to start selling its 3D TVs, which require glasses, late in 2009 or in the beginning of 2010. Its glassless digital signs were also on display at CES.

"Glassless 3D is available today for digital signage and advertising," Park explained. "But the technology is not ready for TVs, because it would hurt people's eyes or give them a headache to look at today's 3D displays for any length of time. It will be at least a decade before we can get the technology to make glassless TV a reality."

That said, some manufacturers claim they have developed technology that doesn't require glasses. Phillips uses a technology it calls WOWvx. 3M and Toshiba also showed off glassless 3D screens at CES. 3M has created a thin film technology that can be used to beam light selectively to the viewer's right and left eyes.

But glasses aren't the only thing that could hold back 3D adoption. Currently, there's no standard way to get 3D footage from the movie studios or from a live broadcasts to the home. Companies, such as Panasonic, are already working on developing a standard. But industry watchers fear that competing standards could emerge and spur another "format" war like the one that pitted HD DVD and Blu-ray against each other.

Panasonic's Suetsugi said he is hopeful that a common standard for 3D Blu-ray hardware, software, and TVs will emerge sometime this year, paving the way for 3D TV sales to pick up in 2010.

In addition to the standards issue, another hurdle for 3D TV has to do with the high production cost of shooting movies and events in 3D, as well as, the high cost of transporting the video across networks. Three-dimensional video requires multiple cameras for shooting. And it also requires multiple high-definition streams for transporting the video over carrier networks.

Regular standard definition television broadcasts consume more bandwidth capacity than other types of traffic like audio or text. High-definition video eats up even more. And it would likely take at least two full high-definition channels to broadcast live just one game in 3D.

This means that service providers, such as cable or satellite operators, would have to upgrade their infrastructure to handle the high bandwidth demands. Verizon, which is deploying fiber directly to consumers' homes for its Fios service, is already in good shape. But others such as Comcast and Time Warner Cable, are already finding it difficult to carve out enough bandwidth for regular HD video as well as Internet video on their networks.

"Transporting live, high-definition 3D streams is very expensive," said Steve Hellmuth, executive vice president of technology and operations for the NBA. "So there has to be sufficient demand and a pool of content before satellite and cable operators will devote resources to delivering it. I really think that Hollywood will initially drive adoption of 3D in the home."

Cisco CEO John Chambers during his keynote speech at CES 2009.

(Credit: Sarah Tew/CNET Networks)

LAS VEGAS--Two of the tech industries biggest champions for using technology to eliminate poverty in the developing world took the stage at the Consumer Electronics Show here on Friday for the final keynotes of the conference.

The message that the executives brought to the crowd at CES was simple: Technology is key to improving the lives of billions of poor people throughout the world. Intel Chairman Craig Barrett and Cisco Systems CEO John Chambers have each received awards and have been lauded for their work in helping fight poverty throughout the world.

Barrett took the stage first, where he promoted Intel's newly formed program called Small Things Challenge, a partnership the company announced this week with microfinancing firmKiva.org and Save the Children.

As part of this campaign, which is raising funds for Kiva and Save the Children, Intel has promised to donate 5 cents for every person who visits the Smallthingschallenge.com Web site, to push for development and education in emerging countries. And Intel plans to provide up to $300,000 a year for the project.

During the keynote, Barrett provided several examples of how technology, including the new third generation Classmate PC Netbook, which uses Intel's low-power Atom chip, can help improve the lives of people living in poor countries. And he urged everyone in the audience to contribute to Kiva and Save the Children.

"You travel and see the impact that technology and your donations can have on children's lives," he said. "Whether it's Kiva or Save the Children, it's a small step toward making the world a better place. But each and every one of us can play a role."

Adam Duritz of Counting Crows joins Intel Chairman Craig Barrett on stage at CES 2009.

(Credit: Marguerite Reardon CNET News/CBS Interactive)

Intel has enlisted the help of several celebrities to get the word out about the Small Things Challenge. And two of the celebrities supporting the effort, joined Barrett on stage, Adam Levine of Maroon 5 and Adam Duritz of Counting Crows.

Chambers didn't need star power when he took the stage later in the afternoon. The charismatic executive walked among the crowd like a Southern preacher at a church revival. But his message was less about philanthropy and giving back as an individual, and more about how developing countries can implement technology to pull themselves out of poverty.

He started off describing what he considers the "pillars of national competitiveness" that will make developing nations more prosperous. The pillars are education, infrastructure, innovation, the ability to identify market transitions, a supportive government, and collaboration.

He said technology is important to developing nations because it helps drive economic growth, create jobs and improve productivity. And he said it could help improve the quality of life of people, especially when it comes to health care.

Chambers likened developing countries to businesses, and he compared his own company's successes in growing its business over the years to what countries must do to improve the lives of their citizens. He said that countries, like companies, need to look out for market transitions. But he also said that they need to have a clear vision of where they want to go, and they must be able to execute on that vision. What's more, new ideas need to be able to scale as well as be sustainable.

"Emerging countries are like companies," he said. "And they can follow the same path toward success. You must be able to execute. But you can't have speed without vision. And catching market transitions determines whether a company or a country is successful."

Intel Chairman Craig Barrett during his keynote address at CES 2009.

(Credit: Corinne Schulze/CNET Networks)

LAS VEGAS--The sinking economy has actually been a good thing for Internet telephony service Skype.

Scott Durchslag, the company's chief operating officer, told reporters during a press conference here at the Consumer Electronics Show that Skype is actually seeing a surge in new users as people look for ways to cut their phone bills.

"We are seeing consumer take-up of Skype accelerating because people feel they can get value and quality without making a huge trade off," he said. "And we're seeing a whole new opportunity in the business market, as companies that I'd never have thought would be a target for Skype are pro-actively coming to us and asking for a solution."

Skype, which is owned by eBay, offers downloadable software that allows people to make free calls to other Skype users and low-cost calls to cell phones and regular phones. The service also offers free video chat. The company boasts it now has over 370 million registered users. It's been adding about 30 million subscribers a quarter, Durchslag said. And these users are making lots of phones calls. Today, about 8 percent of the world's voice minutes originate from a Skype call, he said.

All told, Durchslag said Skype has been growing about 50 percent compared to the previous year in almost every metric from minutes used to new subscribers to revenues. He also said the company just had its seventh straight quarter of profitability.

All this is happening while other technology companies are hunkering down for a long, dark recession. Meanwhile, Skype is looking to expand its services and address new markets. In particular, the company sees opportunity to develop special services for the business market, offer more video , and expand its presence on mobile phones.

As part of this effort, the company announced here that an enhanced version of its software Skype 4.0, which drastically improves the quality of voice and video, will finally come out of beta in February. It also announced it will be offering its Skype software for mobile devices preloaded on Google Android phones along with about 100 Java-enabled handsets, including some sold in the U.S.

Sadly, Skype is still not available for Apple's iPhone, but Durchslag said an iPhone version will be available in the App Store, someday. But exactly when is still up in the air.

"We have to make sure the call quality is there and the application works really well before we can announce the software for any device," he said in an interview after the press conference. "But we will have something for the iPhone as soon as it's perfect."

LAS VEGAS--Verizon will soon allow some Fios TV customers to remotely access their DVRs online from a computer or via a Verizon Wireless cell phone, the company is expected to announce Thursday at the Consumer Electronics Show that it.

Using the remote access service, Fios TV subscribers are able to remotely review, change or add recording requests, delete recorded programs, browse and search TV and video-on-demand listings, and set parental controls.

The remote control service can be accessed through the Fios TV Web site or by using downloadable software on select Verizon Wireless handsets, including the LG enV2, LG Voyager and LG Chocolate 2 handsets. Other handsets will get the remote DVR capability in the future, the company said.

The new service is free to subscribers who have the Home Media DVR, which allows subscribers to record a show in one room and watch it in up to six other rooms.

Verizon demonstrated the new service in October at a special press event held at Verizon CIO Shaygan Kheradpir's Manhattan apartment. Cable operators, Comcast, Time Warner, Cox Communications and Advance/Newhouse Communications, had high hopes of offering a similar remote DVR programming service through a joint venture they had formed three years ago with Sprint Nextel. But that initiative never really got off the ground.

Tivo, which essentially invented the DVR market, announced in November that it is launching a cell phone-friendly Web site that will allow users to search programming and set their TiVo DVRs remotely. TiVo Mobile will be a free service available "with any Internet-enabled phone through any network, regardless of carrier," the company said.

In addition to the remote DVR function, Verizon also plans to announce Thursday that it's now offering 100 or more channels of high-definition (HD) television in every market where the TV service is offered.

LAS VEGAS--Cisco Systems plans to focus on the consumer market a lot more in the next three to five years, the company's CEO John Chambers said Wednesday during the company's press conference at the Consumer Electronics Show.

John Chambers, Cisco Systems CEO

(Credit: Cisco Systems)

This increased focus will likely mean a "steady stream of product announcements, partnership announcements and acquisitions" from the company as it grows this market, Chambers said.

Cisco initially got into the home networking business in 2003 with its acquisition of Linksys and it increased its presence a couple of years later with the acquisition of set-top box maker Scientific Atlanta. With these products as the corner stone of its consumer business, Cisco claims it has sold some 160 million home routers and set top boxes.

But Chambers said the company plans to make a much more aggressive push moving forward, especially over the next 12 months.

"We are really committed to this market and we're putting the whole company behind it," he said. "We will be very aggressive."

Chambers said he hopes to grow Cisco's consumer business to between $5 billion and $10 billion over the next few years.

Cisco has been talking about increasing its presence in the home for more than a year. And Wednesday it announced new home networking products and a bold new service designed for big media companies to help bring more rich content to consumers.

The first set of products come from the Cisco's Linksys home-networking business unit. And they're designed to let consumers share music throughout their home. The Wireless Home Audio system sends music over a standard Wi-Fi network to speakers in multiple rooms. The bundle of products, which starts at about $999 for two rooms, even allows music from Apple iPods and iTunes to be accessed through a single controller and played throughout the home.

Cisco also introduced a new Media Hub, a storage device that allows people to access content remotely over the Internet. The product, which comes in different storage capacities up to 500 gigabytes, starts at $299. In addition to providing remote access, the Media Hub provides back-up of digital files, such as photos and music.

And in an effort to help big media and entertainment companies provide richer interactive content to consumers, Cisco announced its new Eos hosted software platform. Cisco will offer the Eos technology as part of a service, which media and entertainment companies will use to create, manage, and grow online communities. The idea is to streamline the process for building new Web sites, while also allowing media companies to add interactivity and social-networking components.

Chambers said that more is to come over the next several months. But he emphasized that Cisco's focus on consumer electronics is not just about individual products, but about building a platform and an architecture that can be sustained in the future.

For all its fervor, Cisco's consumer ambitions may not be so easy to achieve. The consumer electronics market is full of competitors. For example, the home audio system that Cisco announced Wednesday is very similar to what's already offered from Sonos. And there are plenty of companies already offering media hubs. What's more Cisco's pricing is not much different from its competitors.

Additionally, Cisco is still struggling to provide a consistent brand to the market. Today's new products for the home are branded Linksys by Cisco. But the company is in the process of migrating its branding solely toward Cisco.

"Cisco is the main brand," said Ned Hooper, senior vice president of corporate development for Cisco's Consumer Business Group. "But we also have existing brands that have generated significant value. So Linksys will be a family brand."

Correction: An earlier version of this story misstated that technology from the Five Across acquisition was the foundation for the new Eos service. It is not.

LAS VEGAS --Two years after it first started courting big media companies, Cisco Systems will finally launch a new product to help these companies harness the power of social networking and connect their brands to fans.

On Wednesday, Cisco will kick off the Consumer Electronics Show here by announcing Eos, a hosted software platform that allows media and entertainment companies to create, manage and grow online communities. Through Eos Cisco has compiled technology tools and slapped on an easy to use interface to make building and customizing Web sites easy. But most importantly, it's bundled into the software, technology that will allow media companies to build interactive Web sites so that fans can connect with musicians, TV shows, movies, or whatever brand a media company wants to promote.

Cisco first began looking for ways to help big media companies late in 2006, when it created the Media Solutions business unit. The idea was to develop and market products to digital media content owners. In February last year, the company bought a startup called Five Across, which developed social networking software.

Dan Scheinman, the Cisco executive behind Eos, believes that the new software platform addresses one of the biggest problems that media companies face today.

"The reality is that media is so disrupted by digital technology," he said. "Fans are looking for ways to connect to their favorite artists or TV shows and they are seeking out communities, but the media companies have been slow to provide this for them. Eos is centered around community and allows fans to participate."

The service provides tools that allow media companies to create blogs, live chats, message boards, rating and ranking systems.

Scheinman believes that social networking is the most important way for marketers and big media companies to reach consumers. Consumers are using sites such as YouTube and Facebook to share media, like videos, music and pictures. He also believes that media companies can combat piracy by offering fans an interactive experience through their own branded Web sites.

"In many ways digital destroys the value proposition for media," Scheinman said. "Other people can rip off the content and monetize it, aggregate it, and take pennies for it."

Cisco Systems, which builds the gear that powers the Internet, is making a big push this year at the Consumer Electronics Show in Las Vegas with new products that will help consumers move digital media around their homes.

Ned Hooper, senior vice president of corporate development for Cisco's Consumer Business Group

(Credit: Cisco Systems)

The company plans to hold a press conference in Las Vegas on Wednesday to reveal the new products and its refined strategy for providing consumers with "communication and entertainment experiences that are more visual, more social and more personal," the company said in a press release.

To get a sneak peek at Cisco's strategy, I talked by phone with Ned Hooper, senior vice president of corporate development for Cisco's Consumer Business Group. While details of the soon-to-be-announced products are still under wraps, Hooper shed some light on why Cisco thinks there is a big opportunity in helping consumers get their homes connected and where the company plans to go with its strategy from next.

Q: Cisco isn't the first company to build products for the digital home. Dell, Gateway, and Hewlett-Packard have all tried to develop products to help consumers play their music and video throughout the home. So far, none of these companies have been very successful. Even Apple's Apple TV is a considered a niche product. Why do you think Cisco will have more success?
Hooper: I think it's important to look at how media and entertainment is being delivered to the home. The presence of the Internet and digital media is transforming all these industries and how people access entertainment and how they communicate with each other.

Over 100 million households have set top boxes with their cable or digital satellite service. So the digital set top box market is doing well. Services such as video on demand and DVRs are in high demand. But building expensive devices for a single function hasn't proven to be a viable market.

Cisco has been positioned very well in terms of being able to offer infrastructure for these network services. And we're already in the consumer electronics business with Linksys and Scientific Atlanta. It might surprise you to know that Cisco has shipped over 160 million consumer devices. This includes set-top boxes and home routers.

LG Electronics will add video streaming features from CinemaNow and YouTube to its 2009 lineup of networked Blu-ray players, the company said Tuesday.

The company will be showing off the new functionality at the Consumer Electronics Show (CES) next week in Las Vegas. (Click here for CNET's complete coverage of CES 2009.)

LG launched its first network-connected Blu-ray player in July with partner Netflix. As part of the deal, viewers get access to more than 12,000 movies and TV shows from Netflix.

With Tuesday's announcement, LG Blu-ray customers will also get access to 14,000 movies and TV shows from CinemaNow. And they will be able to stream millions of Web videos directly from the Internet to an LG Network Blu-ray Player so they can watch it on their TVs.

The current economic slump is driving some consumers to and look for video content online. LG believes it can capitalize on this trend by making it easier for consumers to find entertainment online that can be viewed on their TVs.

"As millions of U.S. consumers view and download movies or TV shows through the Internet, they are demanding easier ways to access content and more home entertainment options," Tim Alessi, director of product development for LG Electronics USA, said in a statement. "From Blu-ray to instant streaming from Netflix to CinemaNow and YouTube, LG is bridging the gap between packaged media and video-on-demand services to provide entertainment solutions for consumers' demand for content."