Telephone giants, cable titans, computer companies and consumer-electronics makers are all vying to provide the next generation of high-tech entertainment — a single network of gadgets that lets you view photos, listen to music, record DVDs and tune into whatever TV programs you want to watch, whenever you feel like watching them.
This convergence of computing, communications and entertainment has been promised before, only to evaporate because of consumer indifference and technology that wasn’t ready for prime time. But now the pieces are finally coming together. And corporations are scrambling to make sure they aren’t left behind.
All the major players have their advantages — and weaknesses. Computer companies, led by Microsoft Corp. and equipment suppliers Hewlett-Packard Co. and Dell Inc., say the processing power and adaptability of the PC gives them an edge in delivering innovative services to the living room. Consumer-electronics giants, like Sony Corp. and Matsushita Electric Industrial Co., maker of Panasonic products, tout the reliability of their extensive line of home-entertainment devices. The big Baby Bells, notably SBC Communications Inc. and Verizon Communications Inc., are investing billions of dollars to deliver a nearly unlimited supply of broadcast and on-demand programming over their broadband optical-fiber networks.
At the moment, though, many experts believe that it’s the cable companies, such as Comcast Corp. and Time Warner Inc.’s cable unit, that have the edge over rivals. Cable already delivers entertainment to millions of U.S. homes, and companies have spent the past few years upgrading their networks to deliver much more. Though cable operators typically have been slow to roll out more advanced technology, they are beginning to add more features to their set-top boxes that give customers new services without the hassle or cost of buying new equipment.
In some sense, there are really two separate match-ups: cable vs. telephone to deliver traditional and on-demand television programs, and PC vs. consumer electronics to provide the hardware in the home-entertainment system. But to an increasing extent, everybody wants a piece of everything.