This year, at the Consumer Electronics Show in Las Vegas - the industry's biggest annual showcase - tablet computers may be grabbing most of the headlines. But the more important story is coming out of the TV market. Firms ranging from Sony to Sharp are betting millions on new technology designed to convince consumers to upgrade the hi-definition TVs many of them bought just a year or two ago. Indeed, from TVs with operating systems to ultra-light 3D glasses, the big tech firms are pulling out all the stops to try to gain supremacy in the next-generation, multibillion-dollar TV market.
The main tool in the manufacturers' arsenal is the so-called "connected" TV. Such sets come with Internet connectivity, allowing users to download applications or content from the Web. Unlike 3D, consumers seemed to have a positive reaction to connected sets. Even though such TVs made up a small portion of overall sales last year, that number is growing, as consumers recognize the vast amount of Web-based content available to them.
But there is still plenty of consumer resistance to the idea of plucking down another four figures on a new TV set. 3D sets, the technology the industry pushed hard last year, has seen less-than-enthusiastic uptake. The reasons for the poor reception are varied: consumers complained there was little 3D content available, especially in the way of cable and broadcast TV. The bulkiness of 3D glasses was another concern, as was the uncertainty around various technological standards - few consumers wanted to risk buying what turned out being the 3D equivalent of BetaMax.
What the industry ends up doing to address these concerns will have a huge impact on consumers. The question is whether the world's biggest TV manufacturers can create products compelling enough to convince consumers to upgrade the priciest piece of electronics in their living rooms.
The Death and Life of 3D TV:
Everyone from Sony to ESPN will try to address the various problems that kept consumers from jumping on the 3D TV bandwagon in 2010. According to some experts, adding 3D capability to a hi-def set runs companies about $200 or $300, something that eventually gets passed on to consumers. But there have been other concerns, besides price.
To get around the issue of bulky 3D glasses, companies such as Samsung are pushing new, lightweight glasses. Toshiba is showcasing a reportedly glasses-free 3D laptop, possibly paving the way for the elimination of glasses entirely (although that still seems a long way off, at least for TVs).
Users also complained there simply wasn't enough content to justify purchasing a 3D TV, even though some companies, such as ESPN, began broadcasting some content last year. Sony, HBO and video-streaming service Vudu are also expected to make content-related announcements. Virtually all other major content providers, however, have little or no 3D offerings. And whether any of this will be enough to convince consumers is yet to be seen.
A TV With Brains
If content was the problem that kept consumers away from 3D TVs last year, manufacturers are pitching so-called Smart TVs as the solution. Led by companies such as LG, most major manufacturers are launching new models that function more like computers than TVs. Most such sets will run consumers more than $1000, but the prices vary wildly based on what kind of hardware is in the machine.
Essentially, smart TVs are always connected to the Web, and allow users not only to download content on demand, but to also run applications such as weather forecast software or social networking tools. A number of firms, such as Sony, tried the strategy last year, but consumer adoption was low, in part because there was little consistency between the smart TV offerings of various companies.
Just about everyone in the TV industry, from hardware-makers to content providers, are rushing to cash in on the booming tablet and smart phone industry by bringing the big screen to the little screen. Nowhere is this push more vital than in the TV industry.
At this year's media-only CES showcase event on Tuesday, a new mobile content group highlighted the TV industry's move into the mobile world. The Open Mobile Video Coalition, which represents some 900 local broadcasters, is starting to take the first steps toward bringing TV channels to mobile devices. Most major networks have already taken similar steps, with mobile apps and Web-based content.
Still, it's likely only a few channels and mobile devices will be compatible, even by the end of the year, but broadcasters are slowly hopping on the mobile bandwagon.
The Battle For Content
With a large number of consumers shifting from traditional and cable TV to streaming services such as Netflix, the biggest names in technology are rushing to provide their own Internet-based content platforms. Google and Apple have already attempted to offer such services, with limited success, as users didn't seem entirely sure why they needed another piece of hardware or software to help them find, download and store content.
This year, Microsoft will also likely make a bigger push into content, signing deals with Netflix and ESPN, among others, to provide more content through the company's Xbox gaming system. There are also rumours the company will try to develop an operating system for TVs, possibly competing with Google. Microsoft hopes to succeed where Google and Apple have not by leveraging its larger ecosystem: the millions of users with Windows on their desktops or Xbox gaming systems in their living rooms.
Google, which has seen some resistance from broadcasters to its TV software, will also see some new third-party TVs running its operating system at CES. However the search engine is believed to still be fine-tuning Google TV for future models.
Netflix, the current dominant player in the streaming digital content market, will also see more competition from startups and established players. However the bigger issue for all digital TV content providers is where that content is coming from - in large part, all service providers have had a hard time working out deals with major studios and broadcasters for the rights to their content, especially newly released movies and TV shows.