Technology giants snuggle up to broadcasters at LV convention

Kevin Rademacher

Thursday, April 22, 2004 | 10:55 a.m.

High-tech companies Microsoft Corp., Hewlett-Packard Co. and IBM Corp. are no strangers to the halls of the Las Vegas Convention Center.

The technology giants are cornerstones of conventions such as Comdex and the Consumer Electronics Show, but this week their presence was especially noteworthy at the National Association of Broadcasters convention in Las Vegas.

Those tech giants are snuggling up to broadcasters in an effort to guide a changing industry into the digital age.

The message was made clear early in the convention as Carly Fiorina, Hewlett-Packard's chief executive, gave the keynote address at the opening ceremony.

"In the digital era, the future is one in which consumers watch or listen to what they want to watch, when they want, at any time they want, on any device," she said. "This is a generation that will not wait for content to be delivered to them at a prescribed time."

A day later, Federal Communications Commission Chairman Michael Powell warned broadcasters that their industry has little choice but to change with technology.

"The rule of the jungle is adapt and evolve or die," Powell said. "The broadcasting industry is no different than any other industry."

He pointed to his young sons' lack of interest in television programming, opting instead for portable devices that play music and video games.

Powell advised broadcasters to look closely at the results of demographic research into current viewing trends.

"Look for the little boys in the ratings," he said. "They are vanishing."

Compounding the problem, new technologies such as wireless Internet and networking devices are now competing with broadcasters for spectrum space. Regulators at the conference indicated that consumer demand will drive the allocation of that spectrum, and broadcasters can't assume that their licenses will be forever safe.

"Trust me, there are a lot of people who want your stuff," Powell said. "They want it to do creative and innovative things for consumers, and there is nothing wrong with that."

As the digital age increasingly puts broadcasters in competition with other information providers, it also opens up new avenues. While those avenues can bring opportunity, they will require a new way of looking at their businesses.

"What happens to a business model that depends on ad dollars when consumers can record the programs they want and skip the commercials altogether?" Fiorina said in her speech. "What happens when a teacher wants to tap your digital archives to order the best TV and film documentaries on the Civil War for her American history class? How do media companies charge for that? Many of these answers will come not just through new economic models, but through the use of new technology."

IBM Corp. came to the convention floor this week with its vision of a "digital home." It is a scaled-down model of a life-size laboratory the company built in Austin, Texas, to illustrate the ability of technology providers to link everything from the television and the home computer to the coffee maker and the refrigerator. The goal, company officials said, is to allow consumers to control every aspect of their lives, from entertainment to air conditioning.

"It's going to require a lot of collaboration from (information technology) companies, consumer electronics makers and content providers," said Steven Canepa, vice president of IBM's global media and entertainment industry operations.

"It is infrastructure that makes it all possible," he added. "That's what we do."

In that digital home, all of the information will be distributed through a central router and onto a network, most likely a wireless network. The key to success is having an industry standard that will allow everyone from appliance makers to local broadcasters the ability to produce universally compatible devices and signals, Canepa said.

"If all devices work together, we can create a personal digital network," he said, adding that delays in establishing an open platform will slow the transition, and the opening of new revenue stream.

A similar stall happened when video cassette recorders hit the market with two standards -- VHS and Betamax.

One of the goals of IBM's booth was to get industry executives talking about possibilities and options.

"Part of the benefit of the NAB convention is that we can show, in an open forum, a new technology," Canepa said. "That in turn spurs dialogue."

The question now is where broadcasters fall in this dialogue.

Powell indicated that it is a major change from the roots of over-the-air broadcasting.

"It used to be about the benefit of a community that shared information," he said. "Now, I want it to be uniquely mine ... For those in an industry whose focus is almost solely about community. You have to ask, where do I fit?"

"Broadcasters continue to think through the business models of the future," Canepa said. "The industry is going through a fundamental transformation."

Gene Greenberg, station manager for KVBC Channel 3 (NBC), said stations are well aware of the changes taking place.

"Stations now employ an awful lot of computer people," he said. "There's a lot of information dissemination we are going to be able to do ... The technology and know-how is there."

Greenberg echoed Canepa's assessment that there will be a significant amount of collaboration needed between broadcasters and those in the technology industries.

Bob Fisher, chief executive of the Nevada Broadcasters Association, said the technology already is being put to use devising ways to issue Amber Alert warnings for missing children that can be quickly disseminated to broadcasters and the public.

"It's a great example of how things can be enhanced with the use of technology," he said. "It's a very exciting time."

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