Friday, January 6, 2006

CES Titans: Yahoo, Google go Toe to Toe With Seamless Desktops, Video and DRM

Call it the year that content went toe to toe with technology, the year that convergence became less a buzzword and more of a reality and that online content technologies began to have clear dominance of consumer electronics. This year's CES coverage features many great reports, the best of them summarized best with additional original reporting at Yahoo's cross-platform Go product, which will be introduced modestly at first on one model of Nokia cell phones but promises components for PC desktops and home video that will allow content and services selected in one Go presence to be available in other Go presences automatically - kind of like a personal file-sharing service. Search Engine Watch notes that the demoed desktop version of Go looks remarkably like the Google Desktop Sidebar that's been out there for several months, combining personal and online content in one easy widget.

On the Google front they've announced a premium video download service that will be compatible with Intel's new Viiv video technology platform and that will incorporate DRM, possibly of Google's own design; Google will take 30 percent of the sales based on whatever prices premium providers want to set. Google also is launching Google Pack, a combined package of popular content-oriented applications including Firefox, Norton AntiVirus, Adobe Reader, RealNetwork's RealPlayer, Trillian IM, and Ad-Aware antispyware. Short of office-ware (for which Sun's OpenOffice could fill the gap) this represents a core of what could be the basic equipment of the rumored Google PC. Maybe.

Not surprisingly Microsoft Chairman Bill Gates pooh-poohed all of the limelight that Google and Yahoo were enjoying at CES (CNET), perhaps just a little bit miffed that the crowds at CES no longer part Moses-like for him alone. Gates' demo of Microsoft's new Vista operating system highlighted integration with home entertainment, its own Sidebar-like application and some vision-thing demos of where convergence technologies are taking us. All potent stuff, but in "the future is now" world of CES it seemed to ring a little hollow, a bit like General Motors hawking concept cars that may or not be built in time to make a difference.

The key to CES this year was content, with traditional content and technology companies learning with some awkwardness how to dance with one another much more closely than they really know how to or really want to. The "old guard" producers of consumer content are beginning to recognize that there's more to be gained than lost by moving more aggressively with online partners, but regardless of what the agreements and supporting spreadsheets may say they're not really sure whether they've made effective moves or not: they just know that whoever doesn't try to move at all will regret it in a big way. Experimentation is the order of the day, and as long as some sort of DRM is out there to lower the fear levels they're going to give any number of things a try. It's necessary experimentation, to be sure, but extraordinarily short-sighted for the most part.

Content producers have an enormous opportunity to set the table for themselves far more effectively by creating and embracing their own open cross-platform strategies that will give them much greater leverage across all of these increasingly sophisticated delivery options. That's not likely in the short term, though: instead content companies will continue to play the field of portal and platform providers who will take the lead with DRM and other knotty technology issues. But as the reality of being locked into technology partners for core content licensing sinks in, there will be an evolving counter-movement towards publisher-controlled digital packaging of content. The convergence battles have just begun, but already they are beginning to define for some time to come the field on which content ecommerce is evolving.
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