Vision - September/October 2007 - (Page 23) 2,600 titles on a subscription basis as well as 300 titles on a pay-per-view basis. Late this year, the company expects to offer videos for sale. And while as recently as July Vongo worked with only two Toshiba Gigabeat PMPs, Greene says the service soon will align with another, PlaysForSurebased, PMP brand. A focus on easy access to content, low price and the ability to customize and personalize a PMP also drove Archos Inc. when the company devised its newest (fifth-generation) devices, which will now. So, cell phones and Smart phones are beginning to compete with PMPs as audio and video entertainment devices. For example, Nokia’s N800 Internet Tablet, features a high-resolution (800x480 pixels) widescreen display, has a built-in Web-browser and plays six types of video— MPEG-4, MPEG-1, H.263, Real Video, 3GP and AVI—as well as supporting Flash. Toward the end of this year, Nokia plans to open an online store to sell music and games, and may add video to the offerings in the future, says Kasey Farrar, a spokes- Fuzzy ForeCasts Disagreement persists, however, over whether cell phones and smart phones will supplant stand-alone PMPs in keeping users entertained. Products like the iPhone and more multimedia-oriented cell phones and smart phones tailored for faster networks will proliferate, with support for video becoming much more pervasive—even a competitive feature—in 2008 and beyond, predicts CEA’s Koenig. “Over the next several years, an increasing number of consumers will “you’vE got to bE ablE to gEt contEnt Easily and EffEctivEly onto thE dEvicE.” —larry Smith be in stores starting in September. Two new models, the 605 ($199-$299) and 705 ($399-$499), incorporate enhanced Wi-Fi wireless networking technology and a Web-browser to access the new Archos Content Portal, a dedicated website populated with links to partner sites from which videos can be downloaded directly into the PMP. Alternatively, the Wi-Fi could be used to stream Flash-based videos or animations directly into the device from the Internet. These are the first PMPs that are compatible with Flash, notes Larry Smith, chief operating officer of Archos, based in Denver, Colo. Other notable features of the devices include a touch-screen user interface and an electronic programming guide tied to a built-in programmable digital video recorder, which lets the PMPs record video when they’re connected to a TV. “You’ve got to be able to get content easily and effectively onto the device,” Smith says. “I think we’re at that crossover this year. The momentum for portable media players is really starting, and you’ll see that continue to increase throughout the fall.” “It’s all about the user experience,” says David Samberg, a spokesman for Verizon Wireless in Basking Ridge, N.J. Although most people use their cell phone data plans to move photos from the phone to a website, Samberg notes, both cell phones and the cellular networks have evolved to become much better suited to video downloading and playback. Phone processors are faster, phone screens are larger and more vivid, and the networks offer higher bandwidth www.ce.org man for Nokia North America in White Plains, N.Y. The goal, he says, is to turn Nokia into “an experience company” and not have it be just a hardware company. imania At present, of course, the dominant PMP is the Apple iPod. By most accounts, it has captured between 70 and 80 percent of the PMP market. And its newest form, the iPhone, is regarded by some experts as a harbinger of both PMPs and phones to come. The iPhone is “the best iPod they’ve ever made,” declares Tim Bajarin, president of Creative Strategies in Campbell, Calif. It “resets the expectations of what a cell phone should be, how it should act and what it should look like,” and its multitouch user interface will change consumer expectations for how a media player should work. “We don’t see anybody encroaching on Apple’s dominant position.” Not even the fifth-generation Archos devices, with their very good screens and improved user interfaces, top the iPhone, he says. Even iTunes remains the best online media store, Bajarin says, although he also believes Microsoft will emerge as a strong competitor to Apple in this space. Also significant is Apple’s alliance with YouTube to offer videos in the H.264 file format for the iPhone. Besides making the device more user-friendly, it will help to get even more consumers interested in watching videos on a handheld device, says Dale Gilliam, director of primary research at The Diffusion Group in Dallas, Texas. experiment with the technology,” he says. However, Koenig adds, “I’m not convinced that people will be watching movies on their PMPs. The preponderance of video content consumed on PMP devices will be of a bitesize nature,” and “it remains unclear how much traction mobile TV and video content on handsets will be able to manifest.” “They haven’t come around to the [video] service in general,” Gilliam says of consumers. TDG research reveals that while 65 percent of consumers are comfortable downloading a song, only 30 percent are comfortable downloading a movie. Plus, most people still carry their phones primarily for communications, Gilliam says, noting TDG research that shows just 25 percent of broadband users would be interested in watching TV on their mobile phones, and only five percent would be willing to pay extra for it. In the next five years, the PMP market will grow with difficulty because of convergent devices like the iPhone cutting into their market share while a lack of compelling content keeps consumers on the sidelines, sticking to their digital music players, predicts Parks Associates’ Wang. There will be industry consolidation, too, says iSuppli’s Crotty, who expects that five years from now the number of PMP brands will be down to only six or 12 from more than 40 today. But don’t sell PMPs short, Crotty warns. “People have been too quick to write [the PMP] off because of the handset. It still has a lot of legs.” • September/October 2007 23 http://www.ce.org
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