BIG CHANGE COMING IN HOME ELECTRONICS

DAN ALAIMO

WEST HOLLYWOOD, Calif. -- The electronic landscape within the typical U.S. household is in for some dramatic changes in the decade ahead, according to panelists at the Hollywood 2000 conference held here Dec. 13 to 14, by Advanstar Associates, Carmel Valley, Calif.

Sophisticated television set-top machines, personal computers and portable devices that have yet to be invented may all be a part of a communications system that is hooked into the proposed digital information superhighway, they said.

"Haven't the cellular telephone and the portable telephone taught us something?" asked Avram Miller, vice president of corporate business development at Intel Corp., Santa Clara, Calif. "People don't want to be stuck in front of anything," whether a television or a computer, he said.

Miller sees PC-based technology eclipsing the set-top television devices proposed for the video-on-demand systems and new CD-based technology. "More is going to happen in the next five years on PCs than on set-tops. Long-term, I think the PC is going to be the information furnace for your home," he said.

Penetration of PCs into U.S. households is growing at 22% a year, with 5.5 million to 6 million units sold in 1993, Miller said. "The PC world is marching ahead while people are still trying to figure out what to do with games," he said.

Both the picture quality on PCs and its higher level of artificial intelligence will continue to fuel this growth beyond television-based systems, he said. "My computer knows what time it is. My VCR doesn't," he observed.

Greg Riker, director of advanced consumer technology at Microsoft Corp., Redmond, Wash., said he believes the set-top devices will ultimately coexist with PCs in the home. "The fundamental relationship that a person has with a television set, in terms of the things that can be done with that set, will change."

Movies on demand will help familiarize consumers with these changes, he said. "But the potential is here to turn interactive television and the digital highway into a new communications tool. This is the compelling application."

Openness to new applications is the key to these trends, he said. "There is going to be a lot of road kill along the information highway, so you need as many people attempting to develop good services as possible to get the winners out of the pack," Riker said.

Government services, such as renewing a driver's license, will be a big part of this, he said. "We think government services will be a big area for growth and will probably be one of the initial applications that people look at as being universal," he said.

Riker envisions these systems starting to become commonplace by the end of the decade. "You will see a lot of trials between now and mid-1995, and by the second half of 1995, you will see deployment," he said.

Supermarkets could tap into these information systems with promotional announcements and by allowing customers to pre-order a portion of their marketing and then come in and select their fresh food purchases, Risker said. "They are going to have to find some way of extending their franchise into this electronic domain so that they don't get left behind like the village blacksmith."