Show Heralds a Wider Universe of Net Appliances

From cameras to cars and from cell phones to printers, the definition of an "Internet appliance" has been expanded in Las Vegas this week to go way beyond simplified PCs that let you check e-mail and shop for groceries.

Using a range of emerging wireless technologies, Internet connections are being extended to a vast array of gadgets that also include handheld computers, set-top boxes and gaming consoles, bringing new levels of convenience -- and probably confusion -- to users both at home and at work.

"We're moving into an exciting new phase of personal computing," said Tim Bajarin, president of consulting company Creative Strategies Inc. "What an Internet appliance is being defined as today is anything that connects to the Internet that isn't a PC."

Much as the dot-com frenzy forced retailers hurriedly to throw together Web sites and get their businesses online, so the connectivity craze is sending device makers scurrying to add new capabilities to their products. Fueled by competitive zeal and the promise of new ways to sell old hardware, they will boost the number of Internet appliances exponentially in the coming years.

Such devices include a prototype digital camera shown here by Polaroid Corp. which sports a built-in modem allowing users to send photographs directly to a Web site or to a "digital picture frame." The device is expected to be available early next year. Following suit is Eastman Kodak Co., with plans for cameras that let users zap photos around the Web using wireless connectivity, officials here said.

Cars, too, are becoming Internet-ready. Mercedes-Benz USA LLC became the first auto maker to have a major presence at Comdex, touting plans for networked cars that will be able to download everything from movies and games to information about traffic snarl-ups. The company envisions a federated computing model that would allow groups of cars to share information about road conditions and even parking availability.

In the workplace, Hewlett-Packard Co. talked up software that it hopes to embed in all kinds of devices starting with Internet-enabled printers. The company announced a deal here with Finnish phone giant Nokia Corp. that will allow workers to use their cell phone as an office tool for selecting documents from a server and then printing them from the nearest printer, officials said.

As the types of Net appliances on offer gets more diverse, and as their features grow complex, some buyers are bound to become confused, said Gerry Purdy, president of consulting company Mobile Insights Inc.

Take South Korea's Cyberbank, for example, which blazed the convergence trail with a hybrid cell phone/handheld computer. In addition to integrating a CDMA (code division multiple access) module into its new PC-ePhone, the company also offers a companion stylus that has a small keypad, earphone and microphone. The stylus links with the hybrid device and its wireless module using the emerging Bluetooth wireless standard, allowing the stylus to double as a telephone handset.

Running on Microsoft Corp.'s Windows CE operating system, the PC-ePhone features a 4-inch color TFT (thin-film transistor) LCD (liquid-crystal display) that is capable of VGA (640 x 480 pixels) resolution. The unit also runs Microsoft's Internet Explorer browser, allowing full access to the Web. The PC-ePhone is already shipping in small volumes in South Korea, and Cyberbank hopes to offer it in U.S. markets by the end of the year. The company is in distribution talks with Sprint PCS and Verizon Communications Inc., officials here said.

Adding to the mix is the wave of handheld computers and more "traditional" Internet appliances like Web pads and e-mail stations, devices that have showed signs of maturing in their third year here at Comdex. Once the domain of innovative startups, giants have pitched in, such as 3Com Corp. with its Audrey appliance, and Microsoft with its TabletPC concept -- a glorified Web pad that takes the software maker far from the traditional PC.

Key to bringing the Internet to these devices is the plethora of emerging wireless technologies on show here, which eliminate the need for cables and wires and are making it practical, for the first time, to combine the Internet with everyday electronics products.

Standards like 802.11b, which moves data around LANs (local area networks) at up to 11M bps (bits per second), are featured in portable Web tablets like Honeywell Inc.'s Web pad. For greater mobility, Metricom Corp. made a splash with its Ricochet technology, which provides wireless network access at up to 128K bps from anywhere within Metricom's metropolitan coverage areas. The company partnered with National Semiconductor Corp. to develop the WebPad Metro, which will ship next year and includes Windows Media Player for downloading MPEG video clips and MP3 music files from the Web.

Obstacles remain, however, to achieving the vision of pervasive computing touted by IT company executives here this week. The Bluetooth wireless standard, which will allow phones, notebooks and other gadgets to speak to each other in PANs (personal area networks), is "still a disappointment," according to Purdy of Mobile Insights. Component costs remain relatively high, and vendors are reluctant to embrace the technology until it becomes more widely included in products.

Both Bluetooth and high-speed wireless area networking technologies like Ricochet won't be widespread until 2002, Purdy predicted.

Business models also must be hammered out to support the delivery of Net appliances, a market where margins are often razor thin, as well as the services that will support them, said Bruce Stephen, a group vice president with market research company IDC. Educating consumers and IT managers, who will be forced to navigate the complex and fast-evolving digital terrain to determine which products are right for their homes and their businesses, is also a challenge the industry will need to confront.

Still, IDC expects the number of Internet appliances sold next year to hit 48 million, almost double the 28 million expected to be sold over the course of 2000. IDC includes in its tally Web-ready gaming consoles like Sony Corp.'s PlayStation 2 and television set-top boxes -- two products that will lead the growth in appliance sales, according to Stephen.

"This plethora of devices will make it challenging for each of us to try and figure out what's the right mix," Purdy said. "We're going to see lots of experimentation... there will be home runs, and there will be others that are clever but don't quite catch on."

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