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September 30, 2011 7:01 pm
Amazon’s Kindle Fire could transform the tablet market even as the industry remains in its infancy, but some executives now say the hottest trend in consumer electronics will also have a profound impact on the far larger market for televisions.
Rob Wiesenthal, chief financial officer of Sony Corporation of America and chief strategy officer of Sony Entertainment, told a Goldman Sachs conference in New York 10 days ago that the computing power now contained in televisions and in the various boxes attached to them could move to the device on people’s laps as they sat on the couch.
“If you think back five years, it was all about the boxes; Tivo, Slingbox, Roku,” he said: “I think consumers really had box exhaustion.”
In their place, Mr Wiesenthal sees TVs ending up with one wire at the back – the power cord – while consumers use tablets to access video content and control the big screen. A user with a subscription to Sony’s Video Unlimited service could take his or her tablet to a friend’s house and “throw” a film to the friend’s television, he added.
Apple already uses a proprietary technology called AirPlay to connect iPads and iPhones wirelessly to TVs, via its Apple TV boxes. Sony is betting on an open technology called DLNA, a standard designed to make different manufacturers’ devices interoperable with no box. It is not clear that Amazon’s stripped-down tablet will have this capacity.
However, the idea would seem to run counter to the recent trend at Sony and other TV manufacturers to push upmarket HD, 3D or internet-connected TVs, and for Sony to use its PlayStation 3 consoles as its main weapon in the battle for the living room.
But Sony’s motivation may be to improve profitability in its TV manufacturing business, which has been held back by currency disadvantages and a high-cost joint venture with Samsung. Stripping $50-$100 of cost out from a typical TV could transform its profit margins.
Other benefits include the lure of offering more targeted advertising through an IP-enabled tablet than has proved possible through set-top boxes, and the advantages of finding content on a tablet rather than by aiming a remote control at a TV 10 feet away.
Hurdles remain, ranging from the question of whether home Wi-Fi networks have the capacity to transfer large video files seamlessly without interruptions to whether cable companies will make content available in this way.
History also suggests that, whatever innovations appeal to early adopters, many couch potatoes will be content with their old remote control for years to come. After Amazon’s Jeff Bezos unveiled the Kindle Fire at half the price of most rivals, including the Sony S, however, the biggest hurdle may be for other tablet manufacturers to find their place in the fast-changing market.
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