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Page 165

19
The NII in the Home

D. Joseph Donahue
Thomson Consumer Electronics

A successful national information infrastructure (NII) strategy must include a clear vision, plus an action program directed at bringing NII usage in the home to the pervasive level at which we use telephones and television today.

Fortunately, there is an approach that allows the unique strengths of two large industry groups to be applied to the introduction of extensive NII capabilities into a full cross section of American homes. These two industries are broadly defined as the computer and television industries. Neither alone can provide the full range of services in response to the consumer's interests and desires. Full utilization of the strengths of both industries will yield a win-win strategy that could greatly accelerate the introduction and acceptance of diverse NII services in consumer households.

The powerful capabilities of PCs, combined with online services and the Internet, have already provided the initial interest and stimulus for the concepts of a comprehensive NII. The importance of the continued growth and acceptance of these capabilities cannot be overemphasized. One need only look at the sales of computers and software—or the use of the Internet—to feel the ever-increasing utilization in commerce and in the home. And there is no end in sight for the dynamic expansion of the capability of these products and services.

The television industry—with 99 percent household penetration—can also make profound contributions to the acceptance and growth of NII in the home. Until recently, the television industry was solely based on analog technology, which has many limitations when viewed from today's vantage point. The current movement of the television industry to digital systems will allow television to diversify and expand its capabilities in a manner analogous to that of the products and services of the computer industry.

Almost all of the new television systems are based on MPEG 2, which uses flexible transport packets. New digital television signals are thus no longer simply television signals—they are MPEG 2 packetized bit streams that can be used to deliver any desired mix of video, audio, and data. Interactive services over television systems are now also a reality. For example, a Thomson Consumer Electronics-Sun Microsystems partnership recently announced an interactive operating system, "OpenTV," designed to work over digital systems with interactivity interfaced through the TV remote control or the PC.

The strong consumer interest in television will allow interactivity to be introduced in a nonthreatening manner to the broad segments of society not currently disposed to using a PC. As a result, all members of society will be able to learn to use interactivity with ever-increasing levels of sophistication. Digital television, which will initially be purchased for its entertainment value, can be a key vehicle that can be used to attract consumers and help finance the installation of the digital pathways to digital hardware in the home. Digital HDTV delivery over any media will provide a 19.4-Mbit/sec service to homes. In traditional one-way services such as terrestrial broadcast and direct broadcast satellite, the telephone line is used for the return path. This arrangement is standard in Thomson's Digital Satellite System (DSS) now used to deliver DirecTv and USSB signals nationwide.1

The dual evolution and penetration of computer and digital television services and hardware into the home represents a major win-win victory for all parties concerned. Both industries will use many of the advances of the other. PCs are adding audio and video. Television-receiving products will become digital with microprocessors



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Page 165 19 The NII in the Home D. Joseph Donahue Thomson Consumer Electronics A successful national information infrastructure (NII) strategy must include a clear vision, plus an action program directed at bringing NII usage in the home to the pervasive level at which we use telephones and television today. Fortunately, there is an approach that allows the unique strengths of two large industry groups to be applied to the introduction of extensive NII capabilities into a full cross section of American homes. These two industries are broadly defined as the computer and television industries. Neither alone can provide the full range of services in response to the consumer's interests and desires. Full utilization of the strengths of both industries will yield a win-win strategy that could greatly accelerate the introduction and acceptance of diverse NII services in consumer households. The powerful capabilities of PCs, combined with online services and the Internet, have already provided the initial interest and stimulus for the concepts of a comprehensive NII. The importance of the continued growth and acceptance of these capabilities cannot be overemphasized. One need only look at the sales of computers and software—or the use of the Internet—to feel the ever-increasing utilization in commerce and in the home. And there is no end in sight for the dynamic expansion of the capability of these products and services. The television industry—with 99 percent household penetration—can also make profound contributions to the acceptance and growth of NII in the home. Until recently, the television industry was solely based on analog technology, which has many limitations when viewed from today's vantage point. The current movement of the television industry to digital systems will allow television to diversify and expand its capabilities in a manner analogous to that of the products and services of the computer industry. Almost all of the new television systems are based on MPEG 2, which uses flexible transport packets. New digital television signals are thus no longer simply television signals—they are MPEG 2 packetized bit streams that can be used to deliver any desired mix of video, audio, and data. Interactive services over television systems are now also a reality. For example, a Thomson Consumer Electronics-Sun Microsystems partnership recently announced an interactive operating system, "OpenTV," designed to work over digital systems with interactivity interfaced through the TV remote control or the PC. The strong consumer interest in television will allow interactivity to be introduced in a nonthreatening manner to the broad segments of society not currently disposed to using a PC. As a result, all members of society will be able to learn to use interactivity with ever-increasing levels of sophistication. Digital television, which will initially be purchased for its entertainment value, can be a key vehicle that can be used to attract consumers and help finance the installation of the digital pathways to digital hardware in the home. Digital HDTV delivery over any media will provide a 19.4-Mbit/sec service to homes. In traditional one-way services such as terrestrial broadcast and direct broadcast satellite, the telephone line is used for the return path. This arrangement is standard in Thomson's Digital Satellite System (DSS) now used to deliver DirecTv and USSB signals nationwide.1 The dual evolution and penetration of computer and digital television services and hardware into the home represents a major win-win victory for all parties concerned. Both industries will use many of the advances of the other. PCs are adding audio and video. Television-receiving products will become digital with microprocessors

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Page 166 and interactivity. Both will stimulate the construction and acceptance of improved interactive networks to the home. Consumer interest will determine whether interactivity is first introduced into homes through the PC or the digital television. Over time, homes will contain a powerful PC capability in a den or work location and a sophisticated digital television entertainment center in the family room. Many of the communication networks and software programs will serve both home setups. Full use of the attractive services and products of both industry groups will greatly accelerate the development and use of NII in the home. Maximum implementation of digital television and interoperability across all media require certain federal government and industry actions. • What is key is the completion of the Federal Communications Commission (FCC) Advisory Committee on Advanced Television Service (ACATS) process, with the FCC adoption of the Grand Alliance (GA) HDTV standard as early as possible—late 1995 or early 1996—as recommended by the May 1994 NIST Workshop on Advanced Digital Video in the NII and the recent report by the NII Technology Policy Working Group (TPWG). FCC action must include allocation of new 6 MHz transition channels to all broadcasters. This ACATS-FCC action is moving along toward completion. • Establishment of new infrastructure network rules for the previously separate industries of local telephone, long-distance telephone, cable, broadcast, and so on. for all NII type services is vital. Maximum network development and investment must await a clear set of regulations. • The more difficult government-industry challenge is the establishment of an open interoperable infrastructure within the digital video world. Closed proprietary systems and the potential for many different video systems and interfaces will retard consumer acceptance. Confusion over systems, standards, and interfaces, as in the past, will cause consumers to delay acquisitions. One key ingredient that would help is to provide consumers with the option of buying all home hardware at retail from competitive suppliers. Consumer decisions plus competition will help to establish open and interoperable systems and products. A concern expressed in some quarters is industry's commitment to commercialize systems and products. Commercial commitments will not be a significant problem if the obstacles cited here can be dealt with. As an example, the digital television actions of Thomson Consumer Electronics are tabulated below. Every reasonable effort in the areas of standards, product development, and promotion is being supported, to accelerate the conversion of the home entertainment center into an exciting new interoperable digital center with uses far beyond those common today. Thomson's digital video activities include the following: • Key participant in development of MPEG 1 and MPEG 2 standards. • Leading participant and early proponent of the use MPEG flexible packets for the U.S. HDTV standard. Charter member of earlier Advanced Digital HDTV Consortium and of the recent Grand Alliance HDTV development team. • Developer, manufacturer, and marketer of the RCA Digital Satellite System (DSS), the first high unit volume digital video system ever implemented. • In cooperation with Sun, announced an interactive digital operating system, "OpenTV," that is extremely economical and that can be interfaced through a TV remote control or a PC. • Announced MPEG 2 encoder capability for SDTV (1995) and HDTV (1997). • Announced capability to produce set-top receivers with full microprocessor capability. • In cooperation with Hitachi, demonstrated and announced commercial plans (1996) for a digital D-VHS VCR for the home recording of the DSS signals. • In cooperation with Toshiba and others, announced standard, manufacturing, and commercial plan (1996) for a digital videodisc (DVD) player. • Chaired worldwide working group that reached consensus on a digital recording standard (DVC) for the GA HDTV system. • Announced plans for manufacture and sale of digital television receivers with interactivity (1997).

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Page 167 • Announced plan for digital HDTV receivers with interactivity (1997). • Announced program for a DVD-ROM product (1997). Note 1. As an aside, Thomson announced the shipment of the one-millionth DSS home unit in less than ten months from a standing start. No other consumer electronics or other major product—color TV, VCR, CD, and so on—has ever been accepted at a rate even approaching this level. Consumers are prepared to accept the new digital television systems and hardware.