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XM moves towards providing video entertainment


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#1 of 11 OFFLINE   Ronald Epstein

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Posted January 09 2005 - 04:22 AM

XM Satellite Radio Selects On2 TrueMotion VP6

new york, ny (January 5, 2005) - On2 Technologies, Inc. (Amex: ONT - News) today announced at the 2005 Consumer Electronics Show (CES) that XM Satellite Radio will use its TrueMotion VP6.2 video compression technology in XM's in-vehicle prototype video entertainment system.

The new system will be used to transmit video entertainment to satellite receivers in automobiles. The video signal will be used primarily for back- seat entertainment with content that can be either streamed in real time or and cached for later playback.

After evaluating codecs from several other vendors, XM selected TrueMotion VP6.2 because of its excellent performance in this kind of environment. In XM's tests, competing video codecs failed to achieve the same results.

XM and its automotive equipment partners are demonstrating the satellite entertainment prototype in a new technology showcase vehicle this week at CES in Las Vegas.

On2 is also attending CES and giving private demonstrations of their new products in a suite at the MGM Grand hotel. CES attendees who are interested in visiting the On2 suite can call (917)-865-2143 to make an appointment.

"As XM continues to expand the possibilities of satellite entertainment technology and content, we have incorporated On2's video technology for its quality in both streaming and cached playback applications," said Stuart Cox, XM's Vice President, Advanced Applications.

"The XM deal illustrates once again how TrueMotion excels in diverse applications where quality is the highest priority," said Douglas A. McIntyre, On2's Chairman, President, and CEO. "This opportunity opens up the markets for consumer electronics devices for On2's technology in ways that none of our previous customer relationships have."

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#2 of 11 OFFLINE   Chris

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Posted January 09 2005 - 06:27 AM

Ugh. I figured XM would come out with a video on demand system to compete with SIRIUS, but this is (IMHO) the wrong choice. SIRIUS went with Microsoft's WMV CODEC, a known standard, so the encoding process is already available to hundreds of sources right off the bat.

I had figured XM would be smart to ink a deal using MPEG4 (MP4) or another standard based format with broad acceptance already in the marketplace. On2 (best known as Duck Company) has always had a product with trumotion, but it's adaptive motion filter has always put it in the back because even the new versions have problems with black or single color fields without pollution.

*shrug* It's good that there is competition, and I'm not at all sold on SIRIUS's idea of teaming with MS, though it does give them a marketplace partner, it's just that I figured XM would go with an endorsed standard as an alternative.
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#3 of 11 OFFLINE   Ronald Epstein

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Posted January 09 2005 - 08:28 AM

Chris,

My biggest fear is the bandwidth that XM and
Sirius will need to accomplish video and what
it could do to music quality that doesn't need
to be diminished more than it is already.

Let's keep our fingers crossed.

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#4 of 11 OFFLINE   Michael Ballack

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Posted January 09 2005 - 08:47 AM

It would be cool if you could watch and listen to both Howard or Opie and Anthony at the same time. Pretty cool future ahead.
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#5 of 11 OFFLINE   Chris

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Posted January 09 2005 - 08:58 AM

I spoke with one of the MS reps, and he tells me that the bandwidth to be used in video on both SIRIUS and XM is on a slightly different carrier also held by those satellites, so it's totally unused at the moment, and will require different hardware. So, I don't think it's going to pinch bandwidth.

My concern for both formats is that it doesn't become the prime offering.. after all, in many states, TVs in a car = no if driver visible.

What I had looked for was an adoption of standards. With SIRIUS adopting WMV and a partnership with MS, I feel like if they wanted, audio WMA streams would not be hard.. which I have mixed feelings on.

XM, on the other hand, in chosing truemotion, choses a CODEC with heavier bandwidth requirements, but almost no chance to split into an audio format on it's own as well. The more I've thought of that I can see the perk to that as well.

This is just a techie thing, but I was seriously hoping for MP4, because right now, MS WMV is really taking on big leaps and bounds (see the HD-DVD debate) and this gives it another foothold. The big competitor is an MP4 type standard, backed by Apple and standards groups.. I was (honestly) hoping XM would hop on board with that.

*shrug* we'll have to wait and see how it all shakes out.

The satellite radio market is a big one.. with both of them making plays at Windows Media Center and new home installs, portable units and TiVO devices, Satellite Radio - both XM & SIRIUS - are going a long way to add increasing value to their product Posted Image
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#6 of 11 OFFLINE   Ronald Epstein

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Posted January 09 2005 - 09:21 AM

Chris,

You seem to know this field very well.

You expect SIRIUS and XM to be a household name
one day?

Bought a lot of stock in both companies and I
am hoping to make a bundle on their success.

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#7 of 11 OFFLINE   Joe McCabe

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Posted January 09 2005 - 11:09 AM

Am I the only one who finds the whole concept of streaming video in the car, a bit silly?

Sure, being able to see O&A and Stern's antics while they're happening is cool, but considering the amount of jackasses out on the roads now, I really don't think this is a direction that XM or Sirius need to be heading in.

Maybe if it were ONLY available in home units, and not an in dash player.

BTW, here's a related article from Yahoo..

Video-In-Car Plans Seen Hitting Some Roadblocks

Thu Jan 6, 5:41 PM ET
By Sue Zeidler

LOS ANGELES (Reuters) - The fight for the next big entertainment market is shifting from the couch to the car, but analysts say ambitious media companies aiming to roll out video for automobiles face licensing and regulatory hurdles.

Software, cable and satellite media providers at the Consumer Electronic Show in Las Vegas this week were keen to capitalize on the success of DVD players in automobiles.

Cable company Comcast Corp. and electronics maker Delphi Corp. are working on a system that may allow drivers to view movies they downloaded at home or to use wireless technology to download videos when driving by connection hubs.

They have given themselves six to 18 months to develop such a service but set no date for consumer delivery.

DirecTV Group Inc is also working on an in-car TV service with automotive antenna maker KVH Industries Inc. One analyst said there may be problems for such a service to keep receiving a satellite signal if a car went under a bridge or another obstruction.

And Sirius Satellite Radio Inc. said it will beam video to cars in 2006, using Microsoft Corp. software. That target date is now a year later than it was at last year's trade show.

Sirius' rival, XM Satellite Radio has also demonstrated video capability but has no immediate plans to launch a service. XM CEO Hugh Panero said he questioned the business viability of in-car video because video screens are included in only a tiny number of the estimated 17 million cars sold each year in the United States.

Both XM and Sirius have forged deals with automakers to have their radio receivers installed in cars, but Sirius did not disclose any automotive deals for video.

Regulatory issues could potentially arise. After Sirius announced its video plans last year, the Federal Communications Commission (news - web sites) said it was exploring whether such plans were permitted under Sirius' current authorization or if it would require a new regulatory decision.

The FCC (news - web sites) declined comment this week and Sirius said it was unaware of regulatory issues involving its video plans.

Additionally, analysts said the technology could use fine-tuning.

"XM and Sirius could offer video now, but it's also a matter of allocating bandwidth. As compression technologies improve, it'll be easier to offer video because more bandwidth will be available within their spectrum," said Janco Partners financial analyst April Horace.

Satellite radio providers would have to make deals with content companies and even cable companies' existing video deals with studios would need to be revisited, said Owen Sloane, a lawyer with Berger Kahn in Los Angeles.

"If a studio granted Comcast the rights for 'Cold Mountain' for cable TV broadcast, there's an issue of interpretation as to whether that would apply to transmission to cars," he said.

Nevertheless, many believe that market forces will prevail.

"It may result in a whole new form of contract, but I think it will happen, particularly since studios are always looking for extra income," said Jay Cooper, entertainment lawyer with Greenberg Traurig in Los Angeles

#8 of 11 OFFLINE   Chris

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Posted January 09 2005 - 11:22 AM

Well, I know the computer field well. I'm going to say something that people will think is stupid: both of these companies believe, honestly, they can have 50 Million subscriptions, easy. That would be 1 in 6 cars in the US with a satellite radio, not counting any home installs.

Both companies also believe that they will make big headway into fleet cars (like rent-a-cars, company cars, etc.) and both companies believe that they will become the de-facto choice for on-hold music, as the offer programs that handle royalties and rights for companies - and it's cheaper then agreements with other companies.

I think both companies have a real future.. in about 3-4 years Posted Image I don't think either company will really be pressured out of business.

As to the video market, I think a lot of them are looking at that for a range of different purposes.. but both believe that their ability to offer unique video isn't just geared at the driver.. both companies will come out with new units geared at boats etc. and both are making heavy pitches at the winnebego type crowd Posted Image

I've tried to keep up with announcements from both companies on CES and post the announcements I thought were most important as they happened (unless someone beat me) and the most important announcements I saw out of CES were:

* SIRIUS makes a deal with Microsoft to joint venture video
* XM signs Satellite exclusives with Kornheiser & Dr. Laura
* XM Debuts new Mobile Units
* SIRIUS debuts TiVO device

I had been told all along that XM was preparing their video format, and I was really shocked to see they chose truemotion ;( Both SIRIUS and XM have been trying to lure Apple to form an agreement to offer an IPod with SIRIUS or XM. I felt that if XM went with MP4, which is pushed by Apple as well, then they could licence the decoder from them in an attempt to get a leg up in the IPod race.

I don't know.

I think there is too much short term "when will these companies turn a profit" I think that's going to be a ways away. But I don't think either of them are going to burn out of capital any time soon, because their joint ventures as well as corporate licencing rights pretty much keep them in the water for the first 5 years.. by 2008, they need to be much closer to breaking even, but at the pace they are at, I'm not so worried about that.

The ideas in place for fifth generation units, like what we will see at the end of the year, from both companies are almost sci-fi Posted Image

It's good to be a tech junkie Posted Image
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#9 of 11 OFFLINE   Joe McCabe

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Posted January 09 2005 - 11:46 AM

Unless I misunderstood what I read, to me, the hands down most important Sat. Radio announcement at CES was the XM Connect and Play feature.

Making boomboxes, DVD players, etc "XM Ready" at no noticeable cost to the consumer( as I understand the chip is the size of a tooth, and cost about $1), and then being able to have XM Radio, by purchasing an optional $50 antenna, is just a GREAT idea.

I can easily see that getting the average guy to jump aboard.

Again, to me, that was THE MOVE at CES this year.

#10 of 11 OFFLINE   SteveK

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Posted January 09 2005 - 02:56 PM

I agree, Joe, but it seems there has been relatively little attention paid to this announcement. I guess there's nothing exciting about a $1 chip...unless you realize that it means nearly every manufacturer of audio equipment can incorporate it and offer an "XM Ready" clock radio (for example) for little more than it would have cost without the XM chip. Same with DVD players, even televisions. Move your $50 antenna from your DVD player to your bedside clock radio and enjoy XM all day for one subscription. I think there's tremendous potential in that little $1 chip.

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#11 of 11 OFFLINE   Chris

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Posted January 09 2005 - 03:38 PM

Both XM and SIRIUS introduced easy-connect options (XM Connect & Play, SIRIUS introduced SIRIUSConnect) both of which allow standard radios, etc. to easily interface.

However, for the most part, I believe many who were interested in this with head units had no problem with the FM modulated connection or used it, etc. etc.

Therefore, I look only at technology I believe brings in a different kind of market share, rather then improve on the share they have Posted Image Both of these announcements were big, and will be meaningful to both companies, but they were logical conclusions of what they had to deliver. Whereas other options either altered content and/or the makeup of the product (like video) which changes the way people will evaluate it for adoption to begin with.
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