HP is hot about what it considers a consumer revolution in digital media, and the company's chairman and chief executive officer, Carly Fiorina, last week selected a chic club in Miami Beach to unveil a raft of consumer electronic devices, including HP's version of Apple Computer's iPod, and pledge her company's commitment to this market.
"We believe we have just begun to scratch the surface of what is possible," she said. "We have leadership positions and intellectual property at every stage of the value chain so we see this as a huge growth opportunity for HP for many years to come."
The market for digital entertainment devices and services worldwide stood at $US500 billion in 2003 with growth year-over-year expected in the 6 per cent to 8 per cent range, Fiorina said.
HP estimatef its addressable market in 2007 would be around $US360 billion, she said.
"This is a journey not just for this company," Fiorina said. "It's a journey the whole world is taking.
"The most significant and noteworthy point from today's announcements was that HP is making a statement that it's not a computer company anymore, but that it's a digital media company," president of Inside Digital Media, Phil Leigh, said.
This was the right way to go for HP, because as computing devices for consumers got faster and more powerful, users weren't looking for flashier word-processing applications, Leigh said.
"The applications of the future are digital media applications," he said.
As HP pushed into consumer electronics it would face a new type of customer, an analyst with Creative Strategies, Tim Bajarin, said. These customers weren't as comfortable and knowledgeable about technology as the traditional HP customer, creating a new challenge for the company: to provide world-class support to this type of user.
"This is especially true of older consumers who aren't technically-savvy, and who tend to call up tech support often," he said.
Among the products Fiorina presented were HP's version of the iPod, branded as the Apple iPod from HP, and the new HP Digital Entertainment Center, a device designed for living rooms and for managing digital music, movies and photos.
There was a new brand of printer ink called Vivera that Fiorina said would extend the life of printed digital photos, a new notebook PC that can play DVDs without fully booting up its operating system and plasma and LCD (liquid crystal display) flat-panel television sets.
The Digital Entertainment Center is designed to be a hub for managing digital content such as music, movies and photos from a single device located in the living room. The four-inch tall device, scheduled to ship in the fourth quarter, contains a personal video recorder, a digital video recorder and a DVD, and is managed with a remote control. "It is a couch potato's dream," Fiorina quipped. No pricing information was given for this product.
Meanwhile, the Apple iPod from HP will begin shipping in early September in two versions: a 20GB version costing $US299 and a 40G version costing $US399.
The Apple iPod from HP wouldbe available at major consumer electronic retailers and at www.hpshopping.com, Fiorina said.
HP's intention to partner with Apple on the iPod was announced in January at the Consumer Electronics Show in Las Vegas. Fiorina reiterated the reasoning behind the partnership: "We thought about creating our own devices and our own music service but ... we saw one company whose innovation [in this space] we admired who had both the best music device and service by far."
In mid-September, HP will launch what it calls iPod "tattoos" for users to dress up their iPods.
The self-sticking paper would be preconfigured to fit the iPod, allowing users to print either premade designs or self-made designs, she said. "One thing we know about today's consumers is they want to connect emotionally to their products," Fiorina said.
The so-called HP Printable Tattoos would be easy to apply and remove and be water-resistant, she said.
They will be available at major retail outlets and at www.hpshopping.com.
"It is a great example of HP taking our digital imaging experience and combining it with music," she said.
"The iPod gives HP a best-of-breed MP3 player and lets HP enhance its position in the music space by going into it with a high quality player," Creative Strategies' Bajarin said.
Fiorina also introduced the HP Instant Cinema Digital Projector ep9010, which combines a projector, DVD player and a stereo/subwoofer sound system, which she described as "a boombox for movies."
Estimated retail price for this product is $US1999. It will ship in the third quarter.
This product was quite unique due to its portability, Creative Strategies' Bajarin said.
He envisioned that this concept of a mobile video theater could prove attractive to a broad array of users, from civic groups to people throwing parties in their homes.
"It has the potential to open some new doors ... and possibly become a [product] category in its own right," he said.
The HP Pavilion Entertainment Notebook dv1000 cuts down the time for preparing to play a DVD in such a machine from about 2 minutes to about 8 seconds because an HP technology called QuickPlay does away with the need to load the entire operating system for playback. This notebook will be available in retail stores in October while configure-to-order models will be available in late August. Prices start at $US999 after rebates.
Meanwhile, the new Vivera printer inks extend the life of printed photos from about 20 years to about 80 years using a 3-ink system, and from 75 years to 110 years using an 8-ink system.
Users could put their digital photos in an album for your great-great-great grandchildren to enjoy a century from now ... as clear then as they are now today, Fiorina said.
Among the new TVs, the HP 42-inch High-Definition Plasma set stands out, at $US4999. The HP 30-inch HD-ready LCD TV sells for $US3499.
For more on the Australian implications of HP's digital home push, check out this week's edition of ARN.