2. 2—CONSUMER ELECTRONICS DAILY TUESDAY, NOVEMBER 24, 2009
format over Blu-ray. While Microsoft hadn't ruled out supporting Blu-ray in computers and other products, it had
yet to announce plans to bring the optical disc format into the Xbox 360.
A small number of 3-D videogames have already been released for the PS3 and Xbox 360. But to
date they've only been made available either online via the PlayStation Network and Xbox Live Arcade, by-
passing issues concerning optical disc formats -- as with Invincible Tiger: The Legend of Han Tao from de-
veloper Blitz Games Studios and publisher Namco Bandai -- or via the relatively primitive anaglyph 3-D
process in which the lenses of cheaply designed 3-D glasses are each a different color, like Disney's G-
Force. One apparent issue with the 3-D strategy used for the online game Invincible Tiger was that the 3-D
experience varied for each user depending on the monitor being used, much like the case with current PC 3-
D games, due to the lack of any standard.
SCE had been mum on whether it would be able to make current PS3s compatible with whatever Blu-
ray 3-D standard is finalized. There were mixed opinions on whether it would be able to make current PS3s
firmware upgradable. "It's not possible" to make current Blu-ray players 3-D-capable merely with a soft-
ware or firmware update, Panasonic Executive Vice President Bob Perry told Consumer Electronics Daily at
the 3D Entertainment Summit in September (CED Sept 21 p3). Panasonic, therefore, will not be able to
make its current Blu-ray players handle 3-D, he said then. But Perry conceded he didn't know about Sony's
specific PS3 plans. Blitz Games Studios Chief Technology Officer Andrew Oliver, however, told us at the
Summit that he had no concern about the ability of PS3s to handle stereoscopic 3-D once a Blu-ray 3-D stan-
dard was finalized (CED Sept 18 p2). It's "not inconceivable" in the Blu-ray Disc Association's (BDA) 3-D
spec that an existing Blu-ray player, even a PS3, can be upgraded through firmware updates to play new 3-D
Blu-ray movies, Benn Carr, Walt Disney Studios vice president of technology, told a BDA news conference
at Berlin's IFA show (CED Sept 4 p2).
SCE America (SCEA) and SCEE rolled out various new PS3 features last week. Integration with
Facebook was added as part of the version 3.10 system software update Nov. 18. But, unlike the recent ad-
dition of Facebook integration to the Xbox 360 for paying Gold Xbox Live subscription members, SCEA
added the ability only for PS3 users to showcase their game accomplishments to friends and family on Face-
book and the posting to Facebook of information about the PS3 games they buy from the PlayStation Net-
work. PS3 users have always been able to access Facebook using the console's Web browser, something not
possible on the Xbox 360 because it doesn't have a Web browser.
But like nearly all devices that aren't computers, from the Amazon Kindle to the BlackBerry Storm, the
PS3's Web browser remains a chore to navigate. Microsoft made it simple to use Facebook on the Xbox 360 by
custom designing an application for the console. But 360 users can't make use of all Facebook functions, includ-
ing the ability to access links to Web sites such as YouTube that are posted by other Facebook users. Users
would need to buy a Gold membership plan at about $50 a year. More significant was the addition of the Last.fm
online radio service, also only for Gold members, although Netflix movie streaming remains the most significant
reason for Xbox Live users to pay for a Gold plan. SCEA added Netflix movie streams to the PS3 recently, but
it's available at no extra cost to all PlayStation Network users who are Netflix members. The only noticeable dif-
ference we experienced with watching Netflix movie streams on the PS3 versus the Xbox 360 was the disc that
was required for Sony's console. We had to wait two days for the disc to arrive in the mail from Netflix, but
once it arrived the steps required to get movie streams to start took only a couple of minutes on the PS3. The
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3. TUESDAY, NOVEMBER 24, 2009 CONSUMER ELECTRONICS DAILY—3
main drawback of watching HD movie streams on both consoles versus watching them on Blu-ray Discs remains
the inability to get surround sound with the streams, only two-channel stereo.
SCEE launched the PlayStation Network video delivery service for Europe in France, Germany, Spain and
the U.K. last week. The service was already available in the U.S. Other European countries will follow in 2010,
SCEE said. More than 2,000 movies were made available initially to rent, starting at 1.99 euros ($3), or to buy,
starting at 7.99 euros ($11.96), "many" in HD, it said. Studios providing content include 20th Century Fox, Disney,
Lionsgate, MGM, Paramount Pictures, Sony Pictures, Starz Media, Universal and Warner Bros. Movies available
now include Angels and Demons, Cars, The Dark Knight, Drag Me to Hell, Gran Torino, Harry Potter and the Or-
der of the Phoenix, National Treasure, Pirates of the Caribbean: The Curse of the Black Pearl, Public Enemies,
Star Trek, Terminator Salvation, Transformers 2: Revenge of the Fallen, Valkyrie and X-Men Origins: Wolverine.
More content will be added weekly, SCEE said.
Separately, SCEA is expanding its business in Latin America this month with the launch of PlayStation
products in Brazil via an exclusive distribution deal with Sony Brasil, it said. PS2 hardware and "dozens" of PS2
games are being made available there this month "at over a thousand retail stores across the country," it said. The
Brazil launch "marks the beginning of a two-phase operation to roll out PlayStation products and services to con-
sumers across Brazil," it said. Initially, more than 14 PS2 games are being offered there, including Sony's own
Gran Turismo 4 and God of War II. Brazilian users will have the opportunity to test out software titles at special
PlayStation displays at select retailers. The console will be sold for $445 there, versus the $99.99 it now costs in
the U.S. New game releases will cost $66 -- more than new PS3 game releases in the U.S. -- while catalog PS2
games will cost $55, SCEA said. Select PS2 accessories including the Dualshock 2 analog controller and memory
card will also be available for purchase. It didn't immediately say why the PS3 and PSP aren't shipping in Brazil
now. Nor did it say why the PS2 products cost so much in Brazil versus the U.S. -- Jeff Berman
Boston, New York Weighed
Ultimate Remodels Colorado Stores, Readies National Expansion
Ultimate Electronics is poised to embark on its first major expansion since the 32-store chain was acquired
by Mark Wattles four years ago, store staffers and industry executives told us. Among the markets Ultimate is con-
sidering for new stores are New York and Boston, possibly as soon as Q1, said sources familiar with the chain's
plans. Markets stretching from Los Angeles to Seattle are also under consideration, they said.
In preparing for growth, the Thornton, Colo.-based retailer remodeled its Denver-area stores during the past
six months to feature a more open design and add several categories including desktop and notebook PCs and print-
ers, videogames consoles and software and DVD and Blu-ray titles, store staffers said. Nintendo Wii and Sony PS3
demo areas have been added. The last two stores to be overhauled -- Broomfield and Lakewood, Colo. -- will re-
open for Black Friday after being closed about a month, the store staffers said. Ultimate President Jim Pearce was-
n't available for comment.
The new format dispenses with sound rooms and other demo areas and adds dedicated space for major appli-
ances, PCs, videogames and other products, including Brunswick pool tables foosball and air hockey, industry execu-
tives said. Among the PC brands are Acer's Gateway, Hewlett-Packard, Sony and Toshiba. Ultimate carried PCs under
its previous management, dropping them in 2004. It also tested sales of DVDs and videogames, but exited those catego-
ries before filing for bankruptcy in early 2005. Major appliances were first tested at Ultimate's Oklahoma stores in 2007
with Brunswick products brought to a Colorado store the following year. At the center of the store is an area for selling
cable, cellular and other services, sources said. The new format will be tested in Colorado before being moved to other
4. 4—CONSUMER ELECTRONICS DAILY TUESDAY, NOVEMBER 24, 2009
Ultimate markets, including stores in Arizona, Illinois, Kansas, Minnesota, Missouri, New Mexico, Nevada and Okla-
homa, store staffers said. Ultimate also has signed a lease for a new store in Tucson, sources said.
As for expansion locations, Ultimate is said to be studying former Circuit City and Linens N' Things loca-
tions. Ultimate's earlier format focused on stores that averaged around 30,000 square feet. Under the new design
the stores will likely range from 19,000 to 35,000 square feet, sources said. Wattles purchased 32 of Ultimate's 62
stores out of bankruptcy in 2005 for $43.7 million cash.
Wattles has raised money to fund the expansion, sources said. A separate company is said to have been set
up as a holding company for the new stores that would largely have the same management as the existing chain. If
the expansion proves successful, Wattles could sell the existing 32 stores to the holding company, sources said.
Unclear is the identity of the investors involved other than Wattles. Wattles filed in late 2007 for a 20-million share
seeking to raise $200 million (CED Dec 31 p4). -- Mark Seavy
Independents Widen Appeal
Don’t Copy California TV-Energy Rules, Dealers Urge Feds
Independent AV retailers in California are appealing to legislators in other states and to the federal govern-
ment to avoid adopting the TV energy-use limits adopted in California last week (CED Nov 20 p1). The pleas
came as CE industry groups told us they were contemplating a similar appeal.
“This is not a debate over philosophy. We all support energy efficiency,” Pam Crane of Ken Crane’s Big
Screen Headquarters in Los Angeles said in a statement from the Californians for Smart Energy Consumption Coa-
lition. “This is a debate over process. The CEC’s regulations are based on old data, math errors, and a total disre-
gard for Energy Star or how the consumer electronics industry operates.”
“In less than two years, the energy efficiency of Energy Star TVs has improved by 41 percent without regu-
lations,” said Leon Soo Hoo, owner of Paradyme Sound and Vision in Sacramento. “A better way exists. The
CEC’s unjustified regulations should not be replicated.”
The CEC ignored the concerns of industry, associations and California small businesses “and pushed
through harmful and unnecessary regulations that will cost California $47 million a year in lost tax revenues and
destroy 4,000 jobs,” said Shawn Worst, the owner of Evolution Home Theatre in San Diego. “Alternatives exist
that would save as much or more energy than the CEC’s regulations, without hurting the economy, destroying jobs
or hurting small businesses.” The coalition hopes to meet with California’s representatives in Congress, he said.
“We would be happy to meet with Senator Feinstein’s office, or any other elected official, to discuss our concerns
and industry-supported alternatives.”
Appeals to state and federal authorities are possible from other CE stakeholders, our canvass of indus-
try groups found Monday. “CEDIA will continue to invest time and resources in this issue, not only in the
state of California, but as the issue is brought up in other states,” Darren Reaman, the director of public policy
of the Custom Electronic Design & Installation Association, told us. “In addition, we will continue to work
with industry stakeholders and communicate with government officials our concerns with proposed legislation
or regulations on this important issue, and discuss industry-supported alternatives -- many of which are already
working in the marketplace.”
Other industry groups and retailers are still considering the CEC’s actions, they told us Monday. “The
Plasma Display Coalition is still consulting with our members and the CEA regarding most appropriate next steps,”
said Jim Palumbo, the coalition’s president. “There’s a lot to digest in the statements made by the CEC and the ac-
5. TUESDAY, NOVEMBER 24, 2009 CONSUMER ELECTRONICS DAILY—5
tual written regulations.” A Best Buy spokesman said, “We have nothing to say at this point but we will definitely
reach out to you if that changes.” Representatives of CEA and the Consumer Electronics Retailers Coalition didn’t
comment in response to requests. -- Stephen A. Booth
* * * * *
Sen. Dianne Feinstein, D-Calif., wants the U.S. Department of Energy (DOE) to "take a serious look" at setting
national energy limits on TVs that are "as effective" as California's. TVs account for 10 percent of household energy use
and their energy consumption "continues to rise," she wrote Energy Secretary Steven Chu. California last week adopted
stringent energy standards for TVs that aim to cut energy use of the devices by a third in 2011 and by half in 2013. Under
the 1975 Energy Act, the DOE has the authority to set standards for all household appliances, Feinstein said. The depart-
ment has acted on all appliances listed in the Act except TVs, she said. "Energy consumption for appliances with standards
has steadily decreased over the past few decades, while consumption for televisions has risen, especially in recent years,"
she said. And while voluntary programs like Energy Star have helped, "standards can ensure the improved efficiency of the
worst performing models and reduce energy use," she said. As it repealed last month its test procedure to measure energy
use of TVs, the DOE said it would soon begin a rulemaking to set federal energy standards for TVs (GED Oct 23 p1). The
California Energy Commission’s regulation of TVs isn’t based on “good data or good analysis,” CEA said. The group
hopes that if energy standards are taken up at the federal level, the DOE “will base its examination and conclusions on facts
and take into consideration not only the significant progress that has been made voluntarily by industry, but also the most
recent data and analysis regarding the impact of arbitrary energy use limits on TV technology,” said Douglas Johnson, sen-
ior director of technology policy. “Unfortunately, Senator Feinstein’s letter to Secretary Chu repeats some of the false-
hoods promoted by CEC and its supporters, including the statement that TVs account for 10 percent of household energy
use, when in reality it is half that much,” he said. -- DK
DOD in Crosshairs?
FCC Needs Broad Look at Options on Spectrum Decisions, Baker Says
The FCC needs to take a close look at broadcast TV spectrum and whether it can be reallocated to meet the
growing needs of wireless carriers, Commissioner Meredith Baker said during an interview on C-SPAN's Commu-
nicators to be telecast Saturday. But Baker said other spectrum, including that now in the hands of the Department
of Defense, also must be looked at closely.
"All ideas should be on the table," Baker said. "Broadcasters actually have 294 MHz of spectrum and what
we're talking about for these future networks is we're going to need in the range of 800 MHz. It's not the golden egg.
I think it might be part of the solution." Asked specifically about Defense Department spectrum, Baker replied, "I
think it's a valid question to ask." She noted that NTIA, when she was acting administrator, completed a report on
federal spectrum use. "NTIA actually did do a federal strategic plan looking at the spectrum that the federal agencies
use," she said. "We need to do the same thing at the FCC and then we need to bring those two plans together."
One step that would help is launching additional testbeds beyond the one now in place to examine spectrum
sharing between government and commercial users, Baker said. The commission's probe of spectrum for realloca-
tion shouldn't be "anti-broadcast" and it shouldn't be "acrimonious," she said. "The broadcasters are also looking
for new business models," Baker noted. "The mobile video standard was just set. So [what] I think we ought to
take a look at is do those broadcast rules need to be attached to that service."
Meanwhile, Baker said she continues to question whether the FCC needs to impose new net neutrality rules.
"I am not convinced that we actually have a problem that we need to address," she said. "I am actually very happy
with the chairman's process that he has put in place on this. We have just appointed a technical advisory committee
and we're going to have workshops to look at how networks actually operate." Baker questioned whether the rules
6. 6—CONSUMER ELECTRONICS DAILY TUESDAY, NOVEMBER 24, 2009
should apply to wireless networks. "I am most familiar with the wireless networks and clearly there has to be pri-
oritization on wireless networks for them to be able to work," she said. "We'll be working with the industry to
make sure that we come up with something that's reasonable, I hope."
Baker predicted that in approving the National Broadband Plan in February, the regulator will start a
new round of inquiries rather than reach conclusions on many key issues. "All of these decade-old problems,
whether it's universal service or intercarrier compensation or special access, they all are kind of walking
around the FCC saying `if you solve me, you've solved broadband for America,’" she said. "What I hope is
that we'll get a comprehensive look and we move forward to solve all of them, but that probably won't be by
Feb. 17th. ... I think that we will have action plans shortly thereafter. I think that hopefully [the plan] is go-
ing to set out goals that we can make actionable work on throughout the next year. I think we'll be very
busy." Baker said she agreed the Universal Service Fund was ripe for review: "We need to do it in a trans-
parent way and we need to do it in a cooperative way."
Baker declined to comment on a reported deal that would give Comcast control of NBC Universal. In
general, the FCC should move quickly to evaluate mergers, she said, citing the long approval process for the
Sirius purchase of XM. "We have a 180-day shot clock on this,” she said. “I think that Sirius-XM took 500
days." The FCC also shouldn't “attach conditions that are extraneous to the actual deal” before the commis-
sion, she said. -- Howard Buskirk
Ten free channels were added to the Roku Channel Store for streaming online content, Roku said.
The channels are Blip.tv, Facebook Photos, Flickr, FrameChannel, Mediafly, MobileTribe, Motionbox, Pan-
7. TUESDAY, NOVEMBER 24, 2009 CONSUMER ELECTRONICS DAILY—7
dora, Revision3 and Twit. Roku customers need to create an account for access the Roku Channel store. The
channel store will be delivered as an upgrade to Roku customers over the next two weeks, the company said.
The rejection of SlingPlayer Mobile on the iPhone by Apple and AT&T “warrants close scrutiny,” EchoStar
told the FCC during a presentation, said its ex parte filing. Contrary to AT&T’s claims that TV redirection applica-
tions typically cause network congestion, Sling’s technology uses no more bandwidth than TV from any other
source and is uniquely designed to help network congestion issues, it said. Sling users have paid for content and
should be able to access it on any device, EchoStar said. The presentation included technical information on
Sling’s bitrate management and compared its bitrate to other TV applications approved for the iPhone.
The First Amendment right to anonymous expression, even on the Internet, trumps the rights of record
labels to learn the identity of a SUNY Albany student targeted in a P2P suit, an attorney for one of the defendants
claimed at a hearing in Arista Records v. Does 1-16 in the 2nd U.S. Circuit Court of Appeals in New York on
Friday. To override Doe 3's First Amendment rights, Arista and the other record labels must make a "prima facie
case" or better that the defendant actually infringed on the labels' copyright rights, defense attorney Richard
Altman said. "The problem with the plaintiffs' case is that the main thrust of their claims is not supported by ex-
isting law." The plaintiffs failed to state a proper claim because the only factual claim made about the defen-
dant's use of P2P software was that music files were made available in a shared folder on a computer, Altman
said. There is "no proof that an illegal copy was made" by the defendant and that he made the content available
to others, he said. Just because the files were on the defendant's computer doesn't necessarily mean that person
was the one using the computer, he argued. This appears to be the first time that the issue of "making-available"
has been raised at the 2nd Circuit. In the only full trial to consider making-available, Capitol v. Thomas, a judge
in Minnesota threw out the initial verdict because he said a jury instruction with the making-available language
violated appeals court precedent, Altman told us. "Too many innocent people" have already been dragged into
court by the record industry over similar claims, he told the hearing. The record industry has even "served dead
people," Altman claimed, but conceded when pressed by a judge that his client was very much alive. Altman
argued that Congress should be dealing with issues over online copyright infringement, not courts in suits like
this. Plaintiffs' attorney, Tim Reynolds of the law firm Holme Roberts, said he "takes issue" with Altman's
claims. Reynolds claimed the Supreme Court, in the Grokster case, already ruled that downloading music with-
out authorization qualified as copyright infringement whether it was distributed to others or not. There was
strong evidence of infringement in this case, he said. Once music is placed in a shared folder, it's being distrib-
uted to multiple people with access to the folder, he said. There's "no First Amendment issue in this case," he
said. "The law is clear that copyright infringement is not protected speech." -- JB, GP
A federal jury awarded Ricoh $14.5 million in damages after finding that Quanta Storage infringed
two patents for optical disk drives, according to court records. The jury verdict in U.S. District Court in
Madison, Wis., came at the end of a trial that began Nov. 10. Quanta, which is among the top suppliers of
slim drives, was found to have infringed a patent granted in 1991 that described an optical disk apparatus
with a data transfer rate and rotational speed that could be varied by annular zones. The patent covered a
technique for adjusting the operation of a disc drive to permit recording and reproduction of information on
annular tracks of an optical disk. The linear speeds for recording and reproduction were constant, and the
rotational speeds varied. The jury also found that Quanta violated a patent Ricoh was granted in 2003 that
allowed the operation of an optical disk drive to permit efficient recording.