An open device with capabilities like this would cause a small, but important shift in how people deal with video content (ie - television, movies, etc.) For instance, how many people would start using this as a way to catch up on their favorite television program(s) while sitting on the subway or during their lunch hour or while walking the dog or....
We would also need a new term to describe the behavior: "Space-timeshifting"
There are some neat things that can be done to increase the utility in this context as well - for instance the Personal Shopping Assistant. In the context of this device, video on demand becomes possible because of the ubiquity and capacity that a "close-area" high-speed 802.11 network can provide, coupled with the lower throughput demands that come with smaller files designed for smaller screens. Imagine a nice little network running in the department store that streams video to one of these devices wirelessly based on the RFID data the network is receiving from the interaction between the unit and the customer. Personal Tour Guide? Same network infrastructure, slightly different application. The list goes on and on and interestingly, at least in my conception, it really only depends on Television (the industry) for the short-term to spur adoption. Once people have these things, different applications will be built for them that don't appreciably include a force-fed diet determined by the studio execs.
Interestingly, this is where lines that defines the differences between the various devices that we carry around starts to blur even further. What's to stop the audio and/or video iPods from becoming PDAs or phones or even what would stop these devices from adoption video the same way they are adopting MP3. More importantly, every home is going to need a device that keeps track of the to and fro on the home network. Home users don't really want to manage a network to the same degree that a corporate IT department does. Home users simply want to make sure that they've properly space-timeshifted "Survivor" so that they can watch it on the train on the way to the office. They want to make sure that their copy of the Wall Street Journal is dropped on to their Audible-ready device so that they can listen to it at the gym. They want to make sure that the MP3s that they ripped from their newest addition to their CD collection is just as accessible from the car as it is from their home workstation.
But, the big question still hasn't been answered - whose technology will coordinate these devices on the household area network (HAN)? Microsoft would like to see their Xbox pick up this honor, Sony would similarly prefer the PS2. It seems unlikely that these two giants are simply battling it out for console supremacy - it looks a lot more like a battle for control of the "home network furnace". Why else would these giants continue to invest so heavily into such a highly competitive space that doesn't directly hold a lot of upside. While these two titans are tackling each other head on, Intel has very quietly, but convincingly, further entrenched the home computer as this device.
A lot of people don't realize this, but Intel invented USB. Intel also opened up the USB spec so that anyone can implement it. As a result, the technology is supported by hundreds, if not thousands of manufacturers. This ensures that all devices that need to communicate with a centralized computing device can. By ensuring that a broad range of consumer devices can talk to the Intel chipsets easily and efficiently, Intel has given itself a tremendous chance to capitalize on the market's desire for a simple, coordinated household area network. Until the Xbox or PS2 can effectively communicate with the broad range of devices that Intel has brought together with USB, neither product can convincingly replace the Intel desktop and earn their spot on the throne as the 'King of the Home Network'.
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At some point I should get some thoughts together that describes why HANs will prove disastrous for .Net and Passport....