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CES: Convergence and Divergence

19 Jan, 2009 By: Stephanie Prange

While it didn’t offer the excitement of last year’s format war, this year’s Consumer Electronics Show offered some interesting insight into the future of entertainment — how media is getting closer to convergence than ever before, but also how each piece of the media pie might differentiate itself.

The PlayStation 3 is taking some lumps over its high price and slower adoption rate than competing consoles, but the PlayStation Network, especially PlayStation Home, impressed me. In this virtual world, viewers can great their own avatar, decorate their apartment, go to the mall or theater, and buy real estate (for those who have kids, it’s Club Penguin on steroids). One industry insider has often told me that the real opportunity for growing this multi-billion-dollar business is in incremental revenue, and PlayStation Home’s virtual world may be a way to do it. I can forsee BD Live applications in which viewers can get discounts on merchandise in the virtual mall and buy ringtones in the virtual cell phone store. They could also place their PlayStation Home avatars in movies. Sony has already used the service to promote Resident Evil: Degeneration with a special screening in the virtual theater.

Meanwhile, just as the theatrical business has attempted to differentiate itself from DVD with the new 3-D, Blu-ray Disc (as evidenced by Disney demos) is vying to play a part in 3-D viewing in the home on the new 3-D TVs. It’s another advantage, besides better picture and sound, that Blu-ray will have over DVD in the years to come, and it could lengthen the life of the format and differentiate it from competing technology, including downloads.

On the electronic delivery front, Microsoft is getting closer to offering what looks to be an easy-to-use convergent media interface with the upcoming Windows 7. The program will supposedly help better integrate Xbox 360’s network, Microsoft’s Media Center and Windows Home Server with television and other programming. That could help differentiate Microsoft’s products from the avalanche of convergent devices and technologies out there. While the packageless home entertainment looking glass is still muddy, Microsoft seems to have seen a way forward from Vista.

The format war may be over, but change in this business continues in other exciting ways.

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