News from Asia-Pacific: January 1998

Multimedia systems and components are blazing ahead in Asian markets, prompting an influx of systems, software and components from US manufacturers and global alliances. In addition, manufacturers across the globe are cooperating to create standards for various parts of multimedia systems.

One recent effort at standardization came in early November 1997, when four leaders in the multimedia semiconductor industry selected the video interface port (VIP) cores devised by Innovative Semiconductors Inc of the US to develop their video controller devices. VIP is a standard set by the Video Electronics Standards Association (VESA) that specifies the interface between graphics controllers and video devices such as digital video disks (DVD) and video decoders. VIP-based chips will be incorporated in products such as DVD systems and personal computers.

The four companies that adopted VIP for their chips are LSI Logic Corp, S3 Inc, both of the US, SGS-Thomson Microelectronics NV of France and Trident Microsystems Inc of the US. Microsoft Corp of the US also endorsed VIP in its recently released PC '98 guidelines.

US market research company Dataquest Inc predicts that the market for DVD drives installed in desktop computers will top US$4 billion by the year 2000. That figure doesn't include DVD players for home entertainment, which also will include VIP controllers.

"Working with Innovative Semiconductors, S3 intends to produce the world's first VESA VIP-compliant graphics chip," said Wayne Tong, video product marketing manager for S3, a major global supplier of multimedia acceleration hardware and software.

Standards for DVD

In another move to forge standards, Intel Corp of the US in late October 1997 released the first set of guidelines to help define the use of media control interface (MCI) commands. Those commands will allow developers to create a single version of a DVD title that will be compatible with all PCs shipping with DVD technology. Prior to the release of the guidelines, each software developer had to create their own custom components to assure correct playback in all PCs supporting DVDs. This meant multiple versions of each DVD-ROM software title.

In another development last spring, Intel, Microsoft and Cisco Systems Inc of the US announced a cooperative program called Networked Multimedia Connection that aims to spread the adoption of networked multimedia applications in businesses using intranets and the Internet.

There is evidence that the business user community is adopting multimedia products. One example is the US National Institute of Health's Electronic Computer Store II, which in late October 1997 selected TeleVideo Inc to supply computer monitors and multimedia products as part of a five-year contract involving as much as US$350 million worth of computer goods and services from multiple vendors.

More evidence of an openness by businesses to multimedia products is the growth of the video server market. The video server market in the US alone is expected to be worth US$2.3 billion by 2003, according to market researcher Frost & Sullivan of the US. That's up from the US$261 million in 1996. The 1996 growth itself was an impressive 180% over 1995. Currently, the broadcast studio market is the largest video server market segment, followed by government, medicine and other segments.

Another major trend in the multimedia market is towards products that are faster, and have more memory or special features. Such technologies are being developed by companies, purchased through mergers or co-developed with industry partners.

For example, in late October 1997 Creative Technology Ltd of Singapore paid about US$31 million to buy Cambridge SoundWorks Inc of Massachusetts as part of its effort to expand into audio speaker sales. Creative Technology is a maker of personal computer sound cards.

Pressure in Sound Market

Market analysts said Creative Technology will face more competition in the computer audio field as chipmakers like Intel and Cyrix Corp of the US release microprocessors with improved audio functions, which potentially could reduce demand for add-in sound cards.

Trident Microsystems also moved to improve its audio products in November 1997 with two new peripheral component interconnect (PCI) audio chips. Dataquest predicted that the PC audio chip market will top US$700 million in 1997 and exceed US$1 billion by 2000. The hot demand comes from the need for advanced audio features for DVD movies, cutting-edge games with special sound effects and new technologies for PCs and add-in boards. Mercury Research Inc of the US said PCI-based systems will become the majority PC audio system by 1999.

Also in November 1997, Diamond Multimedia Systems Inc of the US moved to improve its products with a Monster 3D gaming accelerator that the company claims can double game performance. A next-generation accelerator to be released in the coming months will again boost performance from two to five times over the current Monster 3D accelerator, the company said. It uses enhanced drivers.

In November Diamond Multimedia also signed an agreement to acquire Binar Graphics Inc, a maker of 3D, 2D and digital video device drivers.

NEC Corp of Japan also adopted a graphics accelerator made by Cirrus Logic Inc of the US for its ValueStar NX and Mate NX commercial and home office PCs to improve 3D graphics performance.

For its part, S3 last October took a license for Rambus Inc of the US's high-bandwidth direct Rambus memory-interface technology, which S3 plans to incorporate into future multimedia products.

"S3 recognizes the long-term potential of Rambus memory technologies in the PC market," said Steve Lapinski, vice president of corporate marketing for S3. "We view this licensing agreement as the first step in delivering industry leading multimedia products which interface to Rambus memory products."

Sub-US$1K PCs from Majors

In the area of multimedia systems, the end of 1997 ended up much the way the year started: with a price war. Intel sparked worldwide concern in early 1997 with price cuts on its MMX Pentium chips, which in turn lowered system costs. And towards the end of 1997, Compaq Computer Corp and IBM Corp, both of the US, sent chills through the home PC market by launching under-US$1,000 multimedia systems or reducing prices.

In early November IBM announced a US$999 Aptiva based on a 166MHz MMX Pentium. It includes a video graphics accelerator and dedicated audio processor.

IBM's Aptiva Multimedia System

Soon thereafter, Compaq said it would slash prices on its home PCs in time for the hotly competitive Christmas holiday season, bringing several models under the US$1,000 price barrier.

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