Google and Intel in web TV launch By Chris Nuttall in San Francisco Published: May 16 2010 18:07 | Last updated: May 16 2010 18:07 Google<http://markets.ft.com/tearsheets/performance.asp?s=us:GOOG> and Intel<http://markets.ft.com/tearsheets/performance.asp?s=us:INTC> are expected to announce a significant breakthrough into consumer electronics and the broadcast industry this week with the launch of a "Smart TV" platform. Top executives from the Silicon Valley companies are reported to be ready to reveal a deal with Sony,<http://markets.ft.com/tearsheets/performance.asp?s=jp:6758> bringing web services to its televisions, during Google's annual developer conference in San Francisco. Intel's Atom microprocessor and Google's Android operating system are spearheading their assault on set-top boxes and TVs featuring integrated internet services. The technology companies have had little success penetrating the TV industry to date but both are now seeking to take advantage of service providers and TV manufacturers scrambling to add web capabilities and content. "The revolution we're about to go through is the biggest single change in television since it went colour," Paul Otellini, Intel<http://markets.ft.com/tearsheets/performance.asp?s=us:INTC> chief executive, told analysts last week. At the Consumer Electronics Show, Las Vegas, in January, manufacturers showed off televisions, Blu-ray players and set-top boxes with internet connectivity and services ranging from movies provided by Netflix, CinemaNow and Vudu to channels playing internet radio, connecting to online photo services and adding social networking features such as Twitter and Facebook. Concept that aims to transform small screen viewing A year from now, according to Intel, television will have been reinvented by a concept it calls Smart TV, writes Chris Nuttall. With TVs, Blu-ray players and set-top boxes rapidly adding wired or wireless internet connectivity to their features, a host of companies are tailoring and integrating web-based content for living room entertainment. Intel says its chips and software will enable not just internet video streaming but could also allow cable operators to turn set-top boxes into video game consoles with games served over the connection. Grid-style TV guides will be replaced by interfaces blending broadcast TV with internet content. Samsung, Sony, LG, Vizio, Sharp and Panasonic are all releasing internet-enabled TVs this year with features such as Skype video calls, Netflix movie streaming and on-screen widgets that offer news, weather, financial quotes, social networking and internet radio. Apple <http://mwprices.ft.com/custom/ft2-com/html-quotechartnews.asp?FTSite=FTCOM&q=AAPL&searchtype&expanded=&countrycode=us&s2=us&symb=AAPL&company=NEW> has yet to mount a serious challenge. Its Apple TV box allows users to buy and rent movies from its iTunes store to play on their TVs. But apart from YouTube videos and Flickr photos, its access to the wider web is limited. Intel pioneered internet "widgets" on TV screens with Yahoo<http://markets.ft.com/tearsheets/performance.asp?s=us:YHOO> in 2008 but while many other players have entered the market since, it remains fragmented and has been slow to take off. "If you had asked me a year ago, I would have said no way Intel and Google could make an impression," said Kurt Scherf, principal analyst at research firm Parks Associates. "But Intel looks to have gained some traction and the operating system space is so wide open that it's a case of why not Google at this point." Intel said its latest Atom chip offers better audio and video performance, wider and open software support and is cheaper than the competition. It currently has an order backlog of 1m units for the chip. France Telecom <http://markets.ft.com/tearsheets/performance.asp?s=fr:FTE> and Telecom Italia<http://markets.ft.com/tearsheets/performance.asp?s=it:TME> are among a number of customers lined up to put the chips in set-top boxes. "We're seeing the beginning of explosive growth," Eric Kim, head of Intel's Digital Home group, told analysts. "Right now, we're gearing up for a massive retail launch of [connected devices] this year." Google<http://markets.ft.com/tearsheets/performance.asp?s=us:GOOG> is expected to call on its Android developer community this week to create applications for TVs and its software could prove popular if it also promises advertising revenues for TV manufacturers. "Consumer electronics manufacturers want a piece of this [advertising] pie and Google is the player in this very crowded space that can immediately offer them revenue share," said Mr Scherf.
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