January 11, 2007 — Imagine that you've wandered into a Best Buy or Circuit City — one that covers 35 football fields, with 65 miles of carpeted aisles, jammed with 140,000 customers and 4,500 news reporters. Every conceivable, and often inconceivable, new product is there, ranging from 108-inch LCD TVs to tiny microchips to implant in your dog. Throw in cars with stereos cranking out 180 dB, leggy spokesmodels beckoning you into their booths, and heaping piles of frankly bizarre chachkas. Then you wake up and think, what a strange and unusual dream! But that was no dream — that was CES.

The Consumer Electronics Show is held every January. The movers and shakers of the international consumer-electronics industry descend on Las Vegas to point and click, slightly before mere mortals point and click, the newest in consumer technology. It's the time to see the latest nifty products (as already reported here by our intrepid staff), but it's also an opportunity get a macro view of the industry and assess where things are heading.

For starters, clearly, digital technology reigns supreme and sits on a heavenly throne, resplendent in its glory, amen. Except for the works of a few analog curmudgeons crouched in corners, everything is positively teeming with binary mathematics. This means that microprocessors crunch the numbers and memories store the results. Digital also means remarkably fast product evolution. CE is now forever hitched to the PC wagon, and both are on a roll. Something that was 512 MB last year is 4 GB this year. Previously pricey products are now cheap. For example, SanDisk is selling a 1-GB flash MP3 player for $60. Next year, it'll probably be $30. The year after that, they'll be in Cracker Jack boxes, because they'll be cheaper than plastic whistles.

In case there was any doubt, this CES proved that flat screens rule. If your TV is more than 11 inches thick, you should throw it away immediately. Get out your tape measure. Make sure your new TV is "Full HD." For that matter, if your DVD player doesn't upconvert to 1080p, toss it too. Oh, and if your receiver doesn't have HDMI ports, it also has to go. Tell your wife I said so.

As always, there are lots of "us versus them" battles raging throughout the CE landscape. None of them is close to being resolved. If anything, the battle lines are just getting more and more tangled. For example, at one press conference, a big manufacturer of plasma displays spent 15 minutes demonizing LCD displays: They can't show fast action, they harm the environment, and according to the videotaped deposition of a professor in Tokyo, they cause eyestrain. So, okay, the message is that plasma is much better than LCD. Great. Then 5 minutes later, the company notes that in addition to plasma TVs it's also introducing a line of LCD TVs. Talk about mixed messages.

In the same way that teenage boys love to play chicken with their hot rods, the CE industry loves format wars. Blu-ray versus HD DVD is the latest example. With Sony claiming to have shipped 1 million PS3s (with Blu-ray drives), the Blu-ray camp is proclaiming that its victory is inevitable. On the other side, Microsoft's Xbox can accept an outboard HD DVD drive, and Microsoft's clout is clearly considerable. Further, the HD DVD side has unveiled a hybrid disc with both DVD and HD DVD layers, which makes it easy for studios to release one disc for both formats. And, not to be outdone by BD's 50-GB capacity, the HD DVD folks have announced a new disc that holds 51 GB.

Sometimes, a CES is notable by what is not there. Observers expected to see dual-format Blu-ray/HD DVD players from both Pioneer and LG, but only LG officially announced one. Selling for $1,199, and dubbed a "Super Multi Blue" player, it's essentially a Blu-ray player that can also play HD DVD discs. But it cannot fully navigate the on-disc HD DVD menus, and oddly, it cannot play CDs. When asked about the latter, LG said that they didn't think that CD playback was important to consumers. Say what? Although interesting, its limitations make the Super Multi Blue player the Hit-of-the-Show-That-Might-Have-Been.

Other companies are showing second-generation Blu-ray and HD DVD players, but despite the steps forward, there are some steps back. RCA, for example, after offering a HD DVD player last year, decided not to offer one this year. Instead, it will wait and see how the war proceeds. Actually, the war may be decided by drives rather than players. Whoever sells the most PC-mounted drives, and recordable BD or HD discs, will ultimately win. Hollywood studios who previously pledged eternal, undying loyalty to one format or another will switch to the perceived-to-be-winning format faster than data can shoot out a port.

Speaking of Hollywood, major studios are cautiously but steadily testing the waters of high-definition movie downloads. Microsoft's Xbox Live service started in November, joining the already established MovieLink and CinemaNow services. MovieBeam sells hi-def downloads of Disney films; movies are delivered overnight to set-top boxes via over-the-air datacasting from PBS stations. Even the notorious BitTorrent plans to provide hi-def downloads when it opens a store later in 2007. Long download times are still a major issue, but as downloads ramp up, the clock is ticking for both Blu-ray and HD DVD discs.

Random observation: No CES is complete without tons of lame celebrity endorsements. This year, one company proudly displayed a video of Eva Longoria, ostensibly on the set of Desperate Housewives, who enthusiastically endorsed the company's TVs, noting that she has one in every room of her mansion. What a lucky coincidence.

Another random observation: At its press conference, one big company arrayed giant screens across the stage and chose some odd videos to show off the displays. As the presentation unfolded, the screens looped through visually exciting hi-def shots of a woman getting a massage (complete with oil being dribbled across her nude back), ankle-to-head pans of a lovely woman crouched on a bicycle, and an orgasmic montage of a bikinied woman emerging from a swimming pool. Pornographic? No. Marginal in the good-taste department? You bet. Sure, Vegas thrives on sex. But early on a Sunday morning, again and again, looping through slo-mo jiggle shots? What were they thinking?

A few other trendlets: wireless home audio systems, noise-canceling headphones, and Bluetooth headphones. The traditional "Zone 2" feature of A/V receivers is being replaced by wireless servers that transmit audio data to another room. Klipsch has added another wrinkle — a wireless subwoofer, because the sub is usually on the other side of the room, and running a cable to it is a pain. Along similar lines, everyone now offers an 80-GB box that docks with an iPod and Wi-Fi's to other receivers around the home. It also seems as if everyone has jumped on the Bose bandwagon and is offering noise-canceling headphones. Maybe it's because Bose has made a mint on its QuietComfort headphones, or maybe the world is just getting noisier. And there's a definite push toward wireless headphones. Look for more MP3 players that transmit the audio data to the headphones instead of spoiling your "look" with a wire.

The most obvious trend at the show: Anything and everything that plugs into, docks with, wraps around, allows wall mounting, causes to glow in the dark, transmits over FM, connects to an armband, cradles, ruggedizes, personalizes, or otherwise is loosely associated with iPods, is huge. On the other hand, the number of iPod wanna-be's is staggering. By sheer market dilution, Apple's monopoly will evaporate.

A final note. In less than 1,000 days, broadcast analog television will cease to exist. Countless analog television receivers, after faithfully tuning into over-the-air broadcasts for decades, will cease functioning in that manner. The days counting down to that event will provide tremendous incentive for consumers to chuck their old TVs and buy new digital ones. And while at the store picking up a new flat panel, they'll probably go whole-hog and toss in a Blu-ray or HD DVD player, a new receiver, and maybe even new speakers. Never before has it been more important to know about audio/video technology and make smart purchasing decisions. And never before has audio/video technology been so complex. My advice: Stay on your toes, stay informed, stay loose, and whatever you buy — make darn sure it's not analog.

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