alteraxion > Digital Entertainment Convergence | Consulting, Venture Capital, Strategic Intelligence.: DC_HW_WI

Following our recent post on the entertainment capabilities of the Treo 600, there's a interesting article in the NY Times by John Markoff (free access for the next 5 days only) which discusses the strategic and design changes taking place in the development of a new generation of smartphones with devices such as the BlackBerry, Sidekick and others by SonyEricsson, HP and Motorola. He also notes that many will be coming out with built-in WiFi capabilities - Palm are you listening?

More importantly for us he goes on to mention that "Cellular executives say they think that a market previously limited largely to business travelers and technology enthusiasts will broaden as networks add digital audio and video entertainment services to their offerings." Finally someone is picking up on this!

An SVP at T-Mobile goes on to state that these devices have until now been a niche but that they have high hopes for a range of devices coming out right now. I would respond that the industry first needs to get its act together before it can reasonably expect to see these devices becoming mass market. There's a ton of work to be done there and I don't see anything at all anywhere being done about it.

Time has come for these and other companies to shed their product-centric approach (push the product) and focus on what really matters - us - by taking a customer-centric approach (deliver solutions!). Until they get this right I can assure you that there's zero chance of these devices ever becoming mass market.

Finally, a PalmOne executive goes on to state that he feels that the company "has a defensible advantage because of the physical design of the Treo 600". Hello!?!?!?! Anybody listening!?!?!?!?! The product is only a small part of the equation! Can they not see it?

Ultimately here is the warning: Palm cannot afford mistakes because if it does not succeed in its transformation efforts to position the Treo line to a wider audience the company may very well not be around in a couple of years time (even if it has proved the ability to reinvent itself in the past).

You may be interested to visit a 'little experiment' that we've been working on with our Treo 600 bloguide...

I absolutely love my Treo 600 which I've now had for a little under a year and judging by PalmOne's stock rise of some 350% in the past six months so do investors. So what is it about this gadget that makes it so cool and why do I think that PalmOne could be doing so much better with it.

First it's a great phone (OK a bit bulky perhaps) and the ability to synch all my contacts/calendar/etc. with Outlook is fantastic. The email and SMS functionalities are also some of the best that I've come across.

Secondly it's a great business tool. I've already mentioned Outlook synchronisation but there are also literally thousands of other productivity software out there to help the business professional. Just visit Handango and you'll get an idea.

Thirdly and most importantly for this discussion it's a great entertainment device. Among others, you can:

listen to music MP3's & stream radio (in the US) via for example Real's Rhapsody,
record any audio such as a memo, your kid, a concert or a meeting with tools such as Personal Audio Recorder or SoundRec or best still use mVoice which is my favourite to date (Thanks Jonathan)
watch movies & videos using Kinoma, Firepad, TealMovie or MMPlayer software (after some trials and errors I managed to convert one of my DVD's to Divx and from there convert it to a Kinoma movie to fit a 256MB SD Card - yes the screen resolution of 160x160 is poor but it works as a proof of concept),
stream TV and other programs with services such as Sprint's MobiTV,
take pictures using the built-in camera and make short videos using a software called MovieRec,
even use it as a webcam with this software
carry with you and watch your entire picture collection and show it to family, friends, colleagues - the Treo becomes a 'photo viewer' with tools such as Resco's and once resized I've managed to put over 1,000 pictures on a 32MB SD card
you can read ebooks of all sorts while on the move buying them from places such as eReader or for free from Project Gutenberg and also listen to audio books from Audible
[added 12.07] just discovered that you can also use your Treo as a mobile RSS newsreader but you'll need to install two more pieces of software here and here or just this one HandRSS (my favourite) or mNews (Thanks Jonathan)
I can even use my Treo as a universal remote control for my televison and stereo using a software called OmniRemote
and finally you can also play games of all kinds from traditional ones such as backgammon to newer space shooters such as Zap!2016

Basically, as a mini 'computer' you can pretty much replicate all the functionalities of your PC on this little handheld device and with the ability to perform all of the above entertainment activities the Treo 600 'should' be considered the uber-portable digital entertainment convergence device. So much has been said about the iPod but can it do all of this? I didn't think so...

Unfortunately PalmOne is not yet up to this task because 1) I'm not sure that the company is really looking at this as the Treo 600 is positioned primarily to business people and 2) the overall 'system' (see my rule) to deliver entertainment content to the Treo is _extremely_ complex which currently limits its appeal to a wider audience.

For example, there are a number of really stupid things that reduce the 'out-of-the-box' appeal of the Treo as an entertainment device:

There are no stereo headphones and the jack on the phone is 2.5mm instead of the standard 3.5mm which means that you'll need to either buy an (extremely ugly looking) adapter for $9.99 or a new set of headphones for $19.99. Considering that the manufacturing cost of the first is probably $0.10 and $0.50 for the second it's obvious that Palm was looking to make an extra buck here but it is doing this at the expense of increased Treo sales which is plain dumb.
Palm will offer you a free copy of a program called pTunes to play your MP3's but only _after_ you've completed your installation and registration - yet another barrier for consumers to climb.
There is no simple way to transfer files between your PC and the Treo's external SD card because it doesn't appear as a drive on your PC or Mac. You'll have to either buy a card reader (another barrier...) or a piece of software made by Softick called Card Export II (works great but adds another $14.95 to the equation).
Palm doesn't introduce you to movies or videos in any way and judging by the effect that I had when I first demoed a movie trailer on my Treo to friends this is something that they could have leveraged to their advantage (just notice all the PR that the mention of a video iPod and the forthcoming Portable Media Players are receiving...)
Then there's also the low screen resolution of 160x160 which makes it less than appealing for movies (but this will be remedied in the forthcoming Treo 610 to be released in the coming months).
Lastly there's the economic equation. Aside from pTunes and one game there are no applications preinstalled on your Treo nor does Palm have an 'entertainment suite' which you could easily access as a bundle. This means that you will have to find and purchase every single one of the above entertainment solutions individidually. Now, can someone honestly tell me how many people will have the patience, time and money to do this?

The above are just a few examples to illustrate how little thought has been given to the Treo 600 overall as an entertainment device. I hope that the team at PalmOne will come to realise the many opportunities that digital entertainment convergence offers them and start working to make this as simple and convenient to use as possible. My bet is that if PalmOne could get this part right they could expect to be selling multiples more than the 150,000 Treos it sold in the last quarter.

If you know someone at Palm then please point them to this article or if your company is working on a digital entertainment convergence product or service and you would like to learn more about how I can participate in your efforts to exploit the opportunities that it offers please drop me an email.