Bits vs. the box

Today Intel announced that it will offer a $1 million bounty for coming up with a sexy box to drive living room acceptance of the PC. The chip developer should save its money. Are cable set-top boxes sexy? Are most DVD players? They’ve found acceptance because they have compelling functionality, something that living room PCs currently lack. Intel would do better to use its prize money for a developer that can come up with a killer application for home theater PCs. If consumers want that functionality, the likes of Sony are up to the task of putting it in a good-looking case. Shuttle is already creating some nice form factors for the living room.

This misplaced focus on hardware reminds me of the sharing functionality Microsoft is pushing with Zune. If you think its system of trial sharing has any merit, hardware is the wrong place to do it It will take a long time before the Zune installed base is large enough so that such sharing is commonplace (think of kids playing Game Boy games against each other). Why not do this with software? Software is so much easier to distribute virally and Napster.com has shown that the labels will agree to a couple of free listens online. Once the songs were zipping among copies of the Zune companion program, then Microsoft could use the hardware to extend that sharing.

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