Microsoft Smart Display

An Update to the project formerly known as "Mira" (December 2002 issue)


This is a follow-on to the article on Microsoft's Mira (a wireless, pen-enabled monitor) that appeared in the July issue (#45) of Pen Computing. The first bit of news is that the name has changed. "Mira" (derived from Spanish for "to watch") was an internal Microsoft code name; the final product name is "Windows Powered Smart Display." "Windows Powered" refers to the fact that the display is running Windows CE .Net as its internal, or embedded, operating system.
Availability
Smart Displays were originally planned to be available in time for Christmas 2002. Microsoft has delayed the schedule to the first quarter of 2003 and is now planning to launch the product at the 2003 Consumer Electronics Show (CES), January 9-12 in Las Vegas. Smart Displays are expected to start shipping during January.

The primary reason Microsoft delayed the Smart Display is to ensure a rock-solid "out of box" experience for the consumer. Microsoft initially tested prototype Smart Displays with a small group of consumers in the Phoenix area. The WiFi wireless hardware included with the prototypes in the test was a popular brand-name access point. The result of the test was that many of the consumers couldn't successfully install the wireless without asking for help from technical support. After this experience, Microsoft changed the wireless strategy for the Smart Display to include a bundled USB wireless adapter (a NIC for the desktop) with every Smart Display. With this new strategy, Microsoft has been able to set and achieve a goal of 10 minutes from opening the box to a fully installed and operating Smart Display.

Based on the results of the early testing, Microsoft also significantly enhanced the Smart Display installation wizard. It now has two main branches, one for the bundled USB adapter, and one for an existing wireless installation (of which there are currently 2M+ in the USA). The wizard detects and adjusts the configuration for several of the popular software firewall products (e.g., ZoneAlarm), and does a loopback test at the end of the installation to confirm proper operation of the wireless link.

Microsoft currently has 50+ homes testing the final configuration of the Smart Display, focusing on the out-of-box experience. Fifty may not sound like many when you consider how many households there are in the USA that have one or more PCs (approximately 70 million), but Microsoft is very good at extracting significant results from a relatively small sample.

Smart Display Cost
The July article included a cost model to help analyze what Smart Displays might cost. The cost of the LCD in that model was low by $40, and the cost of the Windows CE .Net license (a little under $20) was accidentally omitted. With these changes, the model now appears as follows:

Component Cost
10.4" SVGA LCD $180
Geode motherboard $ 70
WiFi (802.11b) wireless $ 45
3-cell Li-ion battery $ 20
32 MB flash memory $ 20
Windows CE .Net License $ 20
64 MB SDRAM memory $ 15
Resistive digitizer panel $ 10
Housing $ 10
Total $390

Using the same formula of 10% for the ODM's profit margin and an OEM multiplier of 1.5 produces a (revised) forecasted minimum street price of $644 for a 10.4" mobile Smart Display. However, it must be understood that this is the minimum street price. It's unlikely that any OEM is going to price their first model of a new product at the absolute minimum - doing so doesn't give the OEM any wiggle room as prices start to fall. It's much more likely that a 10.4" mobile Smart Display will start off around $700 or $800. Instead of Keith White's "$500 to $800" target range, it now seems more likely that Smart Displays will initially be in the $700 to $1,000 range.

Will Smart Displays sell at that price? Maybe, but definitely not in high volume. Microsoft is very explicit about who they expect will buy Version 1 of the Smart Display. According to Keith White, Senior Director of Microsoft's Embedded & Appliance Platforms Group (EAPG), the target audience is "super-users (technical enthusiasts) and early adopters." This audience is assumed to have more disposable income. It's probably a reasonable assumption, since (according to Microsoft's research) super-users have an average of 2.1 PCs per household. This is interesting because one of the advantages of a mobile Smart Display, even in Version 1, is that it can be used with multiple PCs just by switching log-ons with a couple of pen-taps.

Installed Cost
One of the issues pointed out in the July article was that Smart Displays work only with Windows XP Pro, but most consumers have Windows XP Home. Microsoft has decided to address this problem by getting creative about the cost of an upgrade from XP Home to XP Pro for consumers who purchase a Smart Display. While Microsoft hasn't specified exactly what the upgrade cost will be, it sounds as though it will be quite low. This problem may actually turn out to be a non-issue for Version 1 of the Smart Display, since many super-users have XP Pro anyway.
Cost Trends
Microsoft is betting that the cost of the LCD (almost half of the total hardware cost of a 10.4" Smart Display) will drop substantially in the next couple of years, enabling mainstream adoption of Smart Displays in the near future. The author has talked with several producers of 10.4" LCDs in the past three months, and they don't agree with Microsoft. One producer said they expected the 10.4" SVGA to go no lower than $150 in the next three years, which would result in a minimum street price of $594 for the Smart Display.

On the other hand, the cost of 15" and larger LCDs should definitely drop in the next few years due to the "gen-5 fabs" (the next generation of LCD factories) coming on line. The sheets of glass from which LCDs are fabricated ("mother glass") are getting ever larger, which allows efficiently producing multiple quantities of large displays in a single operation. However, the demand for large LCDs (for monitors and LCD TVs) is much greater than for 10.4" LCDs, so almost all of the next-generation factories will be dedicated to producing large LCDs, leaving 10.4" LCDs to be made mostly in existing, stable-cost LCD factories. Since the number of 10.4" LCDs that could be consumed by Smart Displays in the next couple of years is small compared to the number of LCDs used in notebooks, monitors or TVs, there isn't any strong economic force driving down the cost of 10.4" LCDs. It's therefore possible that 15" LCDs may actually become cheaper than 10.4" LCDs in a couple of years, putting the consumer in the counter-intuitive position of having to pay more for a smaller, more mobile Smart Display.

Mike Iannitti, Director of the Extended Computer Division at Intel, recently spent some time using prototypes of both 10.4" and 15" Smart Displays. While he expected that he would be more attracted to the smaller product, he found that the 15" product's light weight and ergonomic characteristics made it very usable. After testing the 15" product, his exact words were, "Wow, this is really neat!"

OEMs and ODMs
All of the Smart Display OEMs and ODMs listed in the July article (Table 2) are still participating. (Note that the URL for DT Research was inadvertently omitted from Table 4 - it's www.dtreasearch.com.) Several new consumer electronic OEMs have joined the Smart Display program recently, including Samsung. The wide geographic spread of these partners make it possible for Microsoft to simultaneously launch Smart Displays in the USA, Europe, Korea and Japan. Accordingly, the initial Smart Displays will be available in English, French, German, Korean and Japanese.
Future Form Factors
In addition to the "remote station" and "remote terminal" future form-factors described in the July article, Microsoft has now added a third possible future form-factor: the "docking station." This configuration could include a DVD drive, a TV tuner, a wired LAN connection back to the PC, and support for living-room sized speakers. This concept emphasizes the "media center" application of the PC, moving the usage into the heart of the home, while leaving the "boring beige box" back in the den.
Future Versions
Microsoft has continued to refine their vision of how the Smart Display will evolve. The two most-desired features in future Smart Displays continue to be multimedia and concurrency.

"Multimedia" refers to the ability to play full-screen streaming video or 3D games on a Smart Display. To achieve this feature requires adding hardware to the Smart Display (e.g., an MPEG decode chip) and making some changes in the version of Windows CE .Net that runs inside the Smart Display. These changes are under the direct control of the Smart Display engineering team, so they're likely to happen relatively quickly. However, adding hardware means adding cost, which may make the purchase price of a Smart Display even higher. Microsoft is currently considering adding multimedia support in Version 1.5 of the Smart Display. The timing of this version is still unknown at this point, although the author's hope is that it will be in time for Christmas 2003.

"Concurrency" refers to the ability to simultaneously use a "regular" monitor and one or more Smart Displays on a single PC. To achieve this feature, Windows XP must be substantially modified, which is not under the direct control of the Smart Display engineering team. Consequently, concurrency in Smart Displays has become linked to the "Longhorn" version of Windows, and has therefore become a Smart Display Version 2.0 feature. Microsoft's current official estimate for the availability of Longhorn is the second half of 2004; many Microsoft-watchers say this is optimistic and that 2005 is more realistic.

When the author asked Mike Iannitti of Intel which feature he thought was more important, Mike said, "Concurrency drastically improves the value proposition of the Smart Display. On the other hand, people have come to trust streaming video on the desktop [PC], so it has to work on a Smart Display. They're both important, and Microsoft and Intel are working on both."

For a very slick, two-minute Microsoft video of a family using a Smart Display in four different rooms on two different floors of their house, visit http://www.microsoft.com/windowsxp/smartdisplay/video.asp. - Geoff Walker

Based in Silicon Valley, Geoff Walker is Pen Computing Magazine's Technology Editor and a consultant with Walker Mobile. Geoff, who hovers on the border between marketing and engineering, is currently focused on pen-enabled mobile products. He can be contacted at geoff.walker@att.net.


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