Intel steps into consumer arena

Intel president and chief operating officer Paul Otellini revealed details of his company's plans to enter the digital TV market...

Intel president and chief operating officer Paul Otellini revealed details of his company's plans to enter the digital TV market at the Consumer Electronics Show in Las Vegas yesterday.

Otellini said his company will manufacture a line of liquid crystal on silicon (LCOS) chips - codenamed Cayley - which will find their way into rear-projection televisions by the end of this year.

Intel hoped its chips would allow television manufacturers to sell thinner and cheaper rear-projection televisions, reducing the cost of a single television by moving much of its electronic complexity into silicon. Otellini demonstrated a digital television using a LCOS chip developed on an older generation of Intel's process technologies.

Intel's LCOS chips are less complex than its Pentium 4 or the Xeon chips, said Paul Semenza, executive vice president for market research firm iSuppli/Stanford Resources. Essentially, the silicon is dressed in layers, with a very simple circuit providing the base for a layer of a highly reflective material, another layer of liquid crystal, and a top layer of coloured glass.

Drawing the circuit would not be a challenge for Intel, but Semenza admitted that the implementation of the top layers can be tricky, and that it is not a technique that Intel has a great deal of experience in manufacturing.

Texas Instruments is the dominant player in the market for rear-projection digital televisions with its digital light projection (DLP) technology, but LCOS will produce sharper images at a lower price, according to Otellini. He predicted that by 2005, consumers will be able to purchase a 50-inch LCOS television with Cayley chips for less than $1,800.

Semenza said this is about two to three times less than a 50-inch rear projection television would cost today, .

Intel's entry into the market should drive its expansion, as well as drive prices down to an afforable level for consumers, Semenza said, although he added that Intel faces a great deal of competition, mainly from Texas Instruments and other makers of miniature LCD rear-projection chips such as Sony and Seiko Epson.

However, Semenza pointed out, one thing that could set Intel apart from it rivals over the long term is its ability to add other types of PC technologies into these televisions, such as applications processors or memory.

Intel also hopes to popularise a new PC design, called the entertainment PC. Last month, Gateway released an early version of the concept, which calls for a PC that looks like a component from a traditional home entertainment centre.

Intel incorporated some of the technologies it has discussed over the past year into its entertainment PC reference design, including Azalia, a next-generation audio standard for PCs, and Grantsdale, a forthcoming chipset that will allow desktop PCs to become wireless access points.

Products based on the reference design should start appearing around the middle of this year, said Louis Burns, vice president and general manager of Intel's Desktop Platform Group. The company envisions a mainstream configuration of the entertainment PC will cost around $800, he added.

Intel also showed a number of portable media players using its XScale chips, which are normally found in personal digital assistants. They will allow device manufacturers such as Samsung, Creative Labs and iRiver America to build portable media players that can handle video as well as audio, Otellini said.

To realise the vision of a connected home, Intel and other industry groups will have to work together with the entertainment industry to develop ways to protect content from piracy, but still allow consumers to share files around their home networks that they have legally acquired, Otellini said.

Tom Krazit writes for IDG News Service

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