Jon Peddie Research

www.jonpeddie.com

Visions and Predictions

Graphics industry leaders take
a look at the year to come

Cloud Computing in 2010

Stereographic 3D goes mainstream
Taking advantage of point cloud data
2010: The year of the tablet
Augmented Reality

Visions from: Ping Fu, CEO GeoMagic; Dr. Levy Gerzberg,

President and CEO Zoran Corporation; Jen-Hsun Huang,
President and CEO Nvidia; Dirk Meyer, President and CEO
AMD; Brad Peebler, President and Co-founder Luxology;
Hossein Yassaie and JPR’s Andy Marken, Jake Richter,
Ted Pollak, and Jon Peddie
2 VISIONS AND PREDICTIONS

Visions and Predictions

A
s is customary in this and other industries, presidents, pundits, and pontificators look into the horizon and
try to divine the future. We asked some of the most visionary people in the industry to share their views with
us and give us a glimpse of what they see coming. We were surprised by the responses, and sadly couldn’t
include them all. Here then are the ones we liked best. As you might expect, each contributor tended to see
the world in his or her own terms but these people are all very engaged in their industries as well. Taken together, the
things that they see as important—really are important because these people and the people who work for them and
with them are helping to make these ideas a reality.
For two years now the cloud has been on everyone’s list of most influential technology. The beauty of talking about
the cloud is that it is a vague term that has room for a variety of actual applications. So, you’re pretty much not going
to go wrong when you go out on an limb and say “the cloud is going to be important.” However, there is another
kind of cloud and the CAD companies have been talking about how important cloud point data is going to be. Ping
Fu from Geomagic gives us her take and reminds us that success is about focus.
Through 2009, we’ve seen quite a few new ideas ooze to the top layers of the collective consciousness. Thanks to
the movie business, stereoscopic 3D is re-emerging. Levy Gerzberg from Zoran, however, thinks that 3D is going to
evolve a little differently than is commonly believed. Not surprisingly, Jen-Hsun Huang at Nvidia is excited about
GPU compute possibilities. His company is making an audacious bet on GP GPU computing and they’re putting a lot
of resources into trying to kick-start the technology. Like Gerzberg, Huang is also very interested in 3D and he’s look-
ing at tablets. As this is being written, the tablet is on everyone’s mind as people expect to see Apple’s take on it early
in 2010. Meanwhile, over at AMD where the company has quite a bit to be optimistic about, Dirk Meyer believes the
new PC operating systems Microsoft’s Windows 7 and Apple’s Snow Leopard are going to have a big impact on the
industry. Meyer sees them as the gateway for his Fusion product. Luxology’s Brad Peebler has wide ranging interests.
He’s expecting to see advances in Augmented Reality, 3D cameras, and photos. Hossein Yassaie from Imagination
Technologies is another challenger in the semiconductor market. He has big ambitions for Imagination and thinks
multimedia will be everywhere enabled by a new class of embedded connected processors.
The JPR crew piped in to, and Andy thinks 2010 will be the year of Always-on Content and never out of touch
smart phones. Interestingly, Jake and Andy take different sides on a couple of issues. Andy sees Blu-ray becoming as
important for storage and archiving as it is for content. Jake thinks social networks and the cloud will help kill off
physical media, while Ted is cautiously optimistic about on-line games, likes consoles and thinks social networks are
over hyped. Jon’s wrap up is, don’t go for the easy forecast and pay attention to intimacy. s

TABLE OF CONTENTS
Visions and predictions................................................................................................................. 2
Ping Fu, Chairman, President and Chief Executive Officer, GeoMagic............................................. 3
Dr. Levy Gerzberg, President and CEO, Zoran Corporation............................................................ 6
Jen-Hsun Huang, Co-Founder, President, and Chief Executive Officer, Nvidia.................................. 6
Dirk Meyer, President and CEO, AMD........................................................................................... 8
Brad Peebler, co-founder, President, Luxology............................................................................... 9
Hossein Yassaie, Chief Executive Officer, Imagination Technologies.............................................. 10
Andy Marken, President, Marken Communications...................................................................... 10
Jake Richter, President, Patent Logistics, LLC................................................................................ 12
Ted Pollak, President, EE Fund Management LLC.......................................................................... 14
Easy predictions, Jon Peddie....................................................................................................... 15

visions and predictions

january 2010
 VISIONS AND PREDICTIONS 3

materials: wheat to bake one’s own bread, wool to knit the

Ping Fu, family garments. During the industrial revolution, millions
Chairman, President and of people moved from countryside to town, from field to
factory floor. Free time was short and so not only did the
Chief Executive Officer, factories produce steel and iron, engines and ships, they
also produced tinned food and knitted clothes and the cor-
GeoMagic ner bakery produced the daily bread. The era of mass man-
ufactured goods had arrived.

W
hy is it that many of us Further economic prosperity and increased automation
get our best ideas during has increased wages and decreased the hours worked. But
the worst times? During rather than use the increased non working time to return to
the last economic down- making our own bread and knitting our own clothes, we,
turn, my company, Geomagic, grew into the leader of the in the advanced industrial economies, have chosen to spend
digital shape sampling and processing (DSSP) market when our time purchasing services. Restaurants now cook and
most observers were writing our obituary. We suffered serve our meal and clear the dishes; personal shoppers ad-
through the effects of a dot-com crash, 9/11, SARS, two vise on suitable fashion garments and then they spend time
wars, and a recession. What makes us perform better com- making the purchase.
paring to the peers, competitions and the general markets This services stage has become so rooted and so preva-
we are in? lent that in many instances it is becoming commoditized
Some of you may be familiar with Viktor Frankl’s leg- in the same was that raw materials such as wheat and oil
endary book, Man’s Search for Meaning, the real life story certainly have, and goods such as PCs and family cars al-
of his experience living in a concentration camp as an Aus- most have. Within financial services, home and car insur-
trian Jewish psychologist in World War II. Frankl found ance, and savings accounts are seen by most consumers to
that those who died quickly had lost hope and a sense of be identical services, with selection based solely on price or
meaning and they tended to focus their attention on their interest rates.
suffering, while those who survived tried to find the mean- In order to differentiate, many companies are moving
ing or learning in this awful situation. If you were to distill beyond services into experiences. Experiences are a distinct
this great book down to what I call an “emotional equa- offering from services. Experiences must provide a personal
tion,” it would be Despair = Suffering—Meaning. Just as in and memorable offering that will remain with one for a
algebra, life is full of constants and variables with suffering long time, but in order to achieve this, the guests (let’s not
being the constant in a concentration camp and meaning call them customers), must be drawn into the offering such
being the variable. Life, and business, is all about where that they feel a personal connection and intimate trust. And
you place your attention. Focusing on the meaning can re- to feel the intimacy, the guest must actively participate.
duce your despair. Thankfully, the prison we experience is This requires products and services are personalized ac-
in our minds as there’s no barbed wire around our offices, cording to the needs, the response, and the behavioral traits
and many company leaders have been freed from their si-
lent suffering by remembering this emotional equation.
As we approach the end of the year, it is a good time to
reflect upon the meaning of our lives and work, as well as
focus on the things and people who really matter the most
to us. Of course, there are many folks who just want to put
2009 behind them with a sigh of relief. The economic cli-
mate proved to be more of a perfect storm. Like a tsunami,
it generated monstrous waves that were intent on destroy-
ing anything in their path. And economic concerns were not
the only source of turbulence, fear, and insecurity during
the year. In this regard, I’m sure that the mass media’s end-
of-the-year reviews will provide many other examples of
why 2009 is a year that deserves to be forgotten.
No matter how bad the year may have been there is al-
ways opportunity to view it through a meaning-centered
lens. And by so doing, the year gone-by offers us a platform
for seeing what an interesting couple of years it has been
and planning a cautiously optimistic future. What better a
time for such reflection then when we experience the end of
one year and beginning of another?
Joseph Pine’s latest work, together with James Gilmore,
concerns the Experience Economy, a stage of economic
offering beyond goods and services. If you think there is
plenty of challenges with SIM then just wait until you read
about the Experience Economy—and it doesn’t just apply
to Walt Disney; it can also apply to financial services.
The Experience Economy is a new stage of economic of-
fering. The agriculture based economy dealt mostly in raw

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january 2010
4 VISIONS AND PREDICTIONS
The technology involved in design-intent
modeling is fundamentally different
from CAD. CAD focuses on creating and
combining various geometric features.
Design-intent modeling searches for
unknown information by structuring
the scanned data from physical objects
and extracting engineering features.
of the guests. Personalization has always been available
for the rich, making it available for the masses is the main
street in the Experience Economy.
What do Experience Economy and Cloud Computing
have in common? The former is the result we desire and
the latter is the technology to bring personalized experi-
ence into reality.
Beyond cloud computing
A lot has been written about cloud computing—work-
ing with data and applications over the Internet—but an
equally influential movement might be the one centered on
another cloud: the point cloud.
For more than a decade, engineers have been able to
scan physical objects and create a 3D point cloud. A point
cloud is exactly what the name suggests: a digital collection
of points that represents a physical object. In the past, the
path from point cloud to an accurate 3D model residing in
a CAD program has been one that requires a fair amount
of expertise to traverse. But steady progress over the last
10 years, aided by two recent breakthroughs, has created
a much wider and accessible data freeway emanating from
the point cloud.
In industries spanning automotive, aerospace, consumer
products, and medical devices, product development and
analysis starts at the point cloud. From there, it branches
into a wide range of potential applications, including me-
chanical and freeform design, mass customization, comput-
er-aided engineering analysis, inspection and quality con-
trol, and rapid prototyping.
Point-cloud processing, sometimes called digital shape
sampling and processing (DSSP), closes the loop between
the physical and digital worlds, providing the physical-
digital match that cannot be obtained with an idealized
CAD model. What Adobe offers to the 2D document world,
DSSP provides to the much broader 3D product world.
Until recently, the most tenuous part of the physical-
digital loop was making the connection between 3D scan
data and 3D CAD parametric models. Over the past two
years, that connection has been simplified and streamlined
by two major developments. One is the ability to capture
and reproduce design intent for a physical object; the other
is Parametric Exchange, which enables automatic native
reconstruction of geometry, speeding product development
time and increasing the quality of the final model.
Although there have been major hardware develop-
ments that have contributed to the rise of DSSP—including
higher-resolution scanners at lower prices, more powerful
visions and predictions
january 2010
graphics processing, and a wealth of rapid prototyping op-
tions—the most important innovations have come from the
software side. Below is a timetable of key software develop-
ments that have led to the ascendency of the point cloud as
the genesis of product development.
• 2000: Integration of software with 3D color scanners;
templates that enable surface patch layouts to be re-
used as templates; automatic reconstruction of sharp
edges lost during scanning.
• 2001: Automatic processing and registering of multiple
scans; automatic color, texture and bump mapping;
boolean polygon editing; new macros that simplify se-
quential tasks; multi-threaded operations.
• 2002: Ability to handle large scanned data in either or-
dered or unordered formats; new algorithms that speed
data processing by 10 fold; wider scanner support.
• 2003: More automated polygon wrapping; one-step
conversion of polygon to NURBS models.
• 2004: Fitting algorithm that automatically determines
when convergence to a final alignment has occurred;
memory mapping and disk caching to handle models
of 100 million points or more.
• 2005: Major surfacing improvements such as feature
detection and segmentation; patch optimization; adap-
tive surface fitting.
• 2006: Feature detection and extraction, the first step
in determining design intent; user-defined patch layout;
color texture mapping.
• 2007: First program to automatically extract design
intent from a physical object; support for 3D scanners
and hard probes under the same interface.
• 2008: Constrained surface fitting for easier surface
alignment; automatic surface extension and trimming.
• 2009: Parametric Exchange, an intelligent connection
with CAD that enables automatic native reconstruction
of geometry.
Two years ago, a major step was made in closing the
physical-digital loop. It’s called “design-intent modeling”—
the ability to automatically extract design intent from a
physical object.
Design-intent modeling expands DSSP beyond reverse
engineering—the process of simply producing an accurate
digital copy. DSSP software can now extract the original
design intent from a scan of a physical model, kick-starting
the process of modeling and adapting that design in CAD.
Users can start with physical models and prototypes of a
new design (such as a car body sculpted in clay) and quick-
ly get to a digital, CAD-ready representation.
The technology involved in design-intent modeling is
fundamentally different from CAD. CAD focuses on cre-
ating and combining various geometric features. It is a
prescriptive process, where everything is explicitly driven
by the user and built by the system. Design-intent model-
ing searches for unknown information by structuring the
scanned data from physical objects and extracting engi-
neering features. It is the first intelligent process for repro-
ducing design intent, drastically shortening lead time in
various industrial applications.
 VISIONS AND PREDICTIONS
This new technology complements CAD, but is unique in
that all operations are driven by scan data, including mesh
processing, segmentation, curve extraction, surface fitting,
constrained fitting and perfecting models. The art of this
process is to extract a valid structure from partial data sets,
and compensate measurement errors in order to get perfect
surface geometries.
Whereas reverse engineering relies primarily on manual
operations, the new technology for extracting design intent
takes a global approach, segmenting the mesh into a com-
plete and consistent structure. Functionally decomposed re-
gions generated in software correspond to the structure and
construction logic of the CAD models to be created.
The ability to generate CAD-ready surfaces from scans
of physical objects laid the groundwork for the latest major
DSSP refinement—Parametric Exchange.
Parametric Exchange is a major section of the software
bridge between point clouds and CAD. It provides an intel-
ligent connection with CAD to enable automatic native re-
construction of geometry. With Parametric Exchange, para-
metric surfaces, datums and curves can be transferred from
DSSP software to CAD without the need for intermediate
neutral files such as IGES or STEP.
Instead of duplicating CAD functionality, Parametric Ex-
change sends the parts of an assembly—in sketch, surface
or solid form—to the CAD program in its native format,
where it can then be edited, assembled and modified ac-
cording to the user’s specifications and downstream needs.
There is no longer the need to fill in missing data lost in the
transfer to a neutral format, or to reconstruct features and
pieces of geometry from scratch.
The Parametric Exchange process leverages the specific
strengths of DSSP and CAD software—DSSP to capture and
process point-cloud data into CAD-ready models, and CAD
to make modifications and prepare for downstream CAE,
CAM, PLM and rapid prototyping operations.
Freedom to explore and customize
The closed loop between scan data and CAD gives in-
dustrial designers the freedom to explore new and endless
variations of products. Think of thousands of permutations
of classic Nike shoes, individualized Mattel toys, or person-
alized gas tanks for Harley-Davidson motorcycles.
It also has the potential to save manufacturers millions
in tooling costs. Instead of recreating an expensive mold
from scratch, for example, companies can scan an existing
one, analyze the wear and tear, design an improved model,
and manufacture new molds in days instead of weeks or
months.
The ability to capture an existing design and quickly
adapt it to new styles and purposes is critical to the evolu-
tion from mass manufacturing to mass customization. The
combination of design-intent modeling with Parametric
Modeling provides many of the essential tools that will de-
liver on the promise of individualized design on an afford-
able, mass scale.
Better quality, realistic analysis
The ability of DSSP to process point clouds into accu-
rate digital models is also opening up new applications in
3D inspection, computer-aided analysis, and quality con-
trol. Companies now have the ability to almost instantly
scan a product coming off an assembly line and compare
it to the idealized CAD model to determine deviations and
visions and predictions
january 2010
5
The closed loop between scan data
and CAD gives industrial designers the
freedom to explore new and endless
variations of products. Think of thousands
of permutations of classic Nike shoes,
individualized Mattel toys, or personalized
gas tanks for Harley-Davidson motorcycles.
changes caused by tooling or molds. Car companies can
conduct finite-element analysis (FEA) and computational
fluid dynamics (CFD) simulations based on the actual digi-
tal model of an as-built part or assembly, rather than the
less-accurate CAD model. Maintenance, repair and over-
haul (MRO) organizations can quickly assess damage to
parts and fulfill the dual goals of better repairs and getting
planes back in the air faster.
In organizations such as Schneider-Electric and ITT/
Goulds Pumps, DSSP starting at the point cloud is driving
major engineering changes.
Schneider-Electric has progressed from dimensional
analysis of singular parts to being able to analyze function-
ality as a major element of an entire assembly’s analysis,
saving countless hours and material across the company’s
90,000-employee, 130-country operations.
At ITT/Goulds, DSSP has generated quality control
breakthroughs, including new processes to improve impel-
ler balance and determine foundry process variation. The
time it takes to analyze impeller balance has been reduced
from hours to 10 minutes, and the ability to accurately
measure wall thickness for molds is delivering greater qual-
ity in much less time.
New medical insight
Another major area that is benefiting from increased au-
tomation and accuracy in point processing is the medical
field. DSSP is having a major impact in areas such as den-
tal implants, orthodontics, prosthetics, hearing instruments,
breast reconstruction, and cleft lip and palate treatment.
Industrial processes based on DSSP have crossed the
chasm into medical, where the ability to scan a body part
or a dental mold enables doctors and dentists to tailor
treatments to the exact physiological needs of their pa-
tients. The results include better fit and functionality of
6 VISIONS AND PREDICTIONS

prosthetic, dental and hearing devices; less invasive and
more personalized treatment; greater ability to analyze suc-
cess of treatment and make adjustments; and better com-
munication with patients through 3D imaging.
From points to endless possibilities
The beauty of applications spawned from the point
cloud is their seemingly infinite variety. A confluence of
ideas and new applications are coming out of dialogue
among industrial, medical and artistic communities.
At Convergence 2009, the Geomagic user conference,
presentations covered everything from refining 119-year-
old foundry processes to exposing a fraudulent Picasso
painting; from the quest to set a world land speed record
to innovations in dental implants; from new applications
in pediatric orthopedics to major reductions in industrial
time-to-market and return-to-market cycles.
Within automotive and aerospace companies, hospitals,
consumer product manufacturers, design boutiques, elec-
trical component makers, medical device providers and a
host of traditional and newly minted entities popping up
throughout the world, a quiet revolution is taking place.
And, it all starts with the humble point cloud. s
Dr. Levy Gerzberg,
President and CEO,
Zoran Corporation.
do facial recognition over the cloud, and display the per-
son’s name on your glasses. Another application might
look something like Star Trek’s universal translator (dur-
ing video conference our voice is digitized and translated in
real-time using a GPU). To make these experiences possible,
we need a massive breakthrough in computing performance
(i.e., GPU computing), cloud/4G, advances in computer vi-
sion, image search, linguistic translation, mobile comput-
ing, and translucent displays. It might be fun to do a “tech-
nologies behind Star Trek or Iron Man” someday.
The harder thing to predict is whether something is
going to be big and also become a category or trend. i.e.,
predicting netbooks. Only Asus predicted it. Everyone else
got dragged into it. Netbooks are a fascinating topic and
worth a quick look. First, is the netbook a trend or a fad?
A bigger question is—“is the usage behavior of netbook a
trend or fad?” We won’t really know why people buy and
use a netbook for a while longer, but it is probably a com-
bination of cheaper, smaller, or good enough computing for
web browsing. Or, in fact, all three are necessary. Because
it is cheap, and small, and good enough for browsing, con-
sumers can take it around with them without concern of
losing or breaking it. If it were our primary PC, we would
have a hard time treating it like a phone. I think netbooks
have tapped into a sensibility that web and basic computing
is all we need most of the time. The PC becomes a “work-
station” and the netbook becomes our “data connected de-
vice” (whereas a phone is a “voice connected device”). I’m
not trying to create new silly terms for the industry, but
it’s important to understand the differences between these
devices and how they will be used. Then the question is

W
hile much of the focus at CES “whether the netbook is the best long-term data connected
2010 will be on 3D televi- device.” I think the answer here is clearly not. But until the
sions, I predict that a signifi- industry finds an easier-to-use device for web browsing, I
cant percentage of future 3D believe netbooks will continue explosive growth. This leads
content will be generated by consumers me to things that will be exciting and disruptive.
themselves using 3D digital cameras.
Watching your own children or videos of family trips on your
own 3D television may be a compelling reason, in addition to
commercial 3D movies, for consumers to buy 3D televisions
and cameras. Also, a desire to share and store user-generated
video content will drive consumers to buy and use more In-
ternet-connected devices such as Blu-ray and Media Players, a
new generation of Set-Top Boxes, connected Digital Cameras,
and even the next generation of the popular Flip MinoHD
camcorder. s

Jen-Hsun Huang,
Co-Founder, President, and
Chief Executive Officer, Nvidia

I
am more enthusiastic and ex-
cited about the impact of com-
puting than ever before. The
goals our industry has been
working towards are all coming to-
gether right before our eyes.
Its fun predicting things that will
be possible someday—Iron Man glasses with augmented
reality (and obviously he is using cloud computing over
4G and a GPU supercomputer at his home). Non-super-
hero uses could be to recognize a person’s face at a party,

visions and predictions

january 2010
 VISIONS AND PREDICTIONS
Everyone can benefit from GPU
acceleration and it is now common
sense that applications can see huge
speed-ups. Things that take hours can
take minutes, and things that stutter
can now be fluid and enjoyable.
The “three big things” I’m excited about are: Tablets,
3D, and GPU computing.
Tablets, “the iPod of web browsing”
Tablets will combine touch display plus android plus
3G/4G plus mobile internet processors and the combina-
tion will make possible lots of amazing devices. Tablets
can allow us to do things we love to do already, more con-
veniently; and over time, in more engaging ways. Millions
enjoy Facebook, YouTube, and Hulu. All of us enjoy maga-
zines and newspapers, and games and movies. The tablet
may perfectly strike the balance between what’s needed to
enjoy all the content and apps on the web and yet be easy
carry, making it far more convenient than a PC. The tablet
may disrupt both smartphones (i.e., set higher expectations
for it) as well as netbooks (i.e., make it obsolete).
The tablet will likely be a game-changer for many in-
dustries. Old media companies can reinvent themselves into
a new media company. Instead of a search-centric way of
finding information on a PC, an “e-reader” tablet experi-
ence can and will likely start with the content. You anxious-
ly open the latest issue of Wired, or Business Week, or the
Economist, or JPR’s Tech Watch. The content is paginated
to fit the resolution. Ads are integrated into magazines on
the tablet just as they are in print, but they’ll go further.
They’ll come alive because of video and flash graphics. You
can circle something interesting to share with a friend. If an
ad is funny and well done, you can forward it to a friend,
making ads viral. Ad revenues can be captured by compa-
nies creating entertaining and attractive content, enabling
magazines and newspapers to continue to create high qual-
ity content that educates and amuses us all.
On the tablet, will Facebook be the killer app? Will Fa-
cebook become the most important game platform? From
Facebook, you can learn about a new game, download it,
make micro-payments, and link up with friends to play to-
gether. If Farmville’s amazing growth is any indicator, Face-
book on a Tablet will be interesting to watch. Casual-social
gaming on a Facebook Tablet maybe just be the most im-
portant gaming platform of this decade.
3D (“the next level”)
Today, using teraflops of processing, we simulate the
world in 3D, create amazing effects, and just at the last
microsecond, do a 3D-to-2D projection so that you can
enjoy it in 2D. There is a lunacy about this. The technol-
ogy has taken some time to develop. There have been lots
of challenges. To bring a “better than 2D” experience to the
world, we need double the refresh rate, much more process-
ing, glasses that allow us to enjoy 3D without losing reso-
lution or refresh rate, and software that synchronizes the
application to the GPU to display to glasses. There’s lots of
visions and predictions
january 2010
7
technology to invent along the entire electronic pathway to
your retinas. And then there’s the matter of content to make
this piece of science into something of use to consumers.
After working on 3D Vision for five years, I believe we are
going to pull it all together this year: fast GPUs to display
to both eyes, 120 Hz HD LCDs with stereoscopic technol-
ogy built in, fast polarized glasses, software to make it all
work, and content. There will be games, movies with 3D
Blu-ray, Youtube in 3D, and cameras to take 3D photos. 3D
will become a must-have feature for gaming PCs this year.
GPU computing
It is now a commonly held idea in the industry that se-
quential computation is best done on CPU and parallel
computing is best done using GPGPU. It is common sense
that the installed base of GPUs is significant and rivals
quad-core CPUs. Everyone can benefit from GPU accelera-
tion. And it is now common sense that applications can see
huge speed-ups. Things that take hours can take minutes,
and things that stutter can now be fluid and enjoyable. The
common sense is basically that if there are two processors
in your PC, use the right processor for the right task. All
of this is excellent progress for an industry that has been
immersed in a “central” processing world for the past two
decades. So, it is frankly amazing that this radical hetero-
geneous computing model has now become common sense
within the industry. That was the big achievement of 2009.
But what are the killer apps that make GPGPU necessary?
My predictions are:
• For gamers: amazement by the beauty of the world that
we create using physics simulation in games. (Look for
PhysX games.)
• For video/photo enthusiasts: delight and joy as they
manipulate silky smooth HD video with ease. (Look
for Adobe CS5).
• For product designers (cars, tennis shoes, buildings):
marvel as their creation is brought to life in seconds
(vs hours) with interactive ray tracing. (Look for Optix
and iRay applications).
• For film creators: catching up with Avatar without the
$500M investment.
• Great benefits for consumers: Disruptive to industries.
See the amazing change from several perspectives.
• From the perspective of the PC industry: Parallel com-
puting will revolutionize the PC architecture starting
from workstations and high-performance segments.
Tablets and smartphones will disrupt.
And the most important element of all is the consumer.
The things we already do are now more convenient (like
what iPod did for music, what Gameboy did for console
games). Experience beyond. New capability. s
8 VISIONS AND PREDICTIONS
Dirk Meyer,
President and CEO, AMD
A 2010 Resolution for the Tech
Industry: Focus on the User
Experience
T
he end of the year offers a time for reflection, often
leading to a resolution to make things better in the
year ahead. In terms of reflection, many in this in-
dustry would like to forget 2009 and move on. But,
I think challenging times also offer the opportunity to ac-
celerate positive change. I know we at AMD have seen a
lot of change in the past year with the creation of a new
manufacturing company, Global Foundries, and the historic
settlement with Intel bringing with it the hope of a fair and
open competitive environment.
Perhaps it is a good time for reflection and change
across the industry, too. A refreshed spirit of innovation
and a fair competitive environment could bring us closer
than ever to giving customers what they’ve always wanted
from computing—powerful, flexible, and satisfying ways to
enhance their lives. We can shift away from what’s inside
computers and focus more on the experiences they enable.
Because computing isn’t really about computers, it’s about
what people can accomplish with them.
For example, I think we can learn a lot from this past
year from the introduction of what others call “netbooks.”
Against the backdrop of a year in which consumers were
looking to get the most for their money, low-priced net-
books seemed widely appealing. But consumers quickly
learned that lower prices more often than not didn’t trans-
late to a positive customer experience. Because, while net-
books may have actually delivered lower prices, what came
with that was a compromised experience that ran counter
to the notion of value. Consumers are smarter than that,
and we in this industry should know better.
The introduction of Windows 7 and Snow Leopard op-
erating systems represent a solid leap forward in enabling
the kinds of experiences consumers clearly want. They are
the first OS’s capable of dynamically harnessing the power-
ful fusion of CPUs and GPUs to deliver a richer visual ex-
perience in desktops and notebooks.
For the industry, it can mean better days for manufac-
turers and retailers, who can return to competing more on
innovation than price. For consumers, it can translate into
much more exciting, immersive, and natural interface. The
quality of visual displays is poised to improve by orders
of magnitude, promising the vibrant photorealistic and 3D
experiences customers increasingly demand. We are just be-
ginning to explore entirely new ways for people to interact
with their machines.
Imagine the possibilities for games and multimedia when
heterogeneous computing delivers a “personal cloud” in a
wireless network to give homes horsepower comparable to
that found in today’s corporate data centers.
All signs indicate that it may not be long before road
warriors routinely carry lightweight notebooks with super-
computer power. You don’t have to be a geological engi-
neer to need that. Even today, popular sites are loaded with
visions and predictions
january 2010
multiple video streams and Flash features that stagger the
strongest PCs. Our next generation of accelerated process-
ing units (or APUs) is designed to bulldoze that demand,
challenging developers and game designers to bring on even
more engaging, entertaining, and productive applications.
As developers turn their attention to office applications,
the newly-available combination of 3-D, motion capture,
interactivity, and high-definition video and audio stands
ready to enable brilliantly visual productivity and collabo-
ration apps that are now inconceivable.
Consumers tell us they want a persistent, ubiquitous,
flexible computing ecosystem to accomplish whatever …
wherever … whenever. “Good enough” computing is clearly
not good enough to meet this demand. Anything less than
maximum innovation, performance, quality, and value is a
losing proposition.
The industry is preparing to deliver this ecosystem
across notebooks, desktops, netbooks, handheld devices,
and forms no one has thought of yet. We are working to
give consumers what they want in thin clients, fat clients,
servers, and the cloud. We’re focusing on providing unprec-
edented capabilities and experiences at work, at home, on
the go, gaming, playing, and connecting. We want to link
people to people, machines to machines, and machines to
people. And we want to make all of this look and feel more
like real and virtual life than ever before.
What are the technical specs on the fact tag? Consumers
don’t care. Just make my life better, more productive, more
exciting, and more fun, they say. As we focus on giving
people more of what they asking for, we all stand to be re-
warded. No wonder Jon Peddie recently told one of my ex-
ecutives, “The industry is jumping up and down with joy”
as it looks at the years ahead.
Here’s to being optimistic. As an industry, we may be fi-
nally ‘getting it.’ s
Brad Peebler, Co-founder,
President, Luxology
Augmented reality:
Gimmick or new reality?
M
ix one part real-time motion tracking, one part
web-cam and one part real-time 3D content and
you’ve got yourself a hot new trend. By real-time
compositing 3D elements over the video coming
in via the webcam, companies are pimping the term “aug-
mented reality.”
You may have seen the recent marketing stunts including
interactive gift cards from Home Depot that, when held to
a web cam, displays possible projects or products displayed
in a 3D crate. The movie Coraline was promoted with “But-
ton your eyes” mirrors—when people on the street looked
into these mirrors they saw themselves with buttons in their
eyes. So far, the use of augmented reality has been focused
on the marketing domain and has the real feel of some-
thing gimmicky. It feels like a technology looking for an
application, which is usually a recipe for failure. However,
I believe augmented reality is not merely going to stick but
could change our day-to-day lives in very profound ways.
 VISIONS AND PREDICTIONS
You may have seen the somewhat hacked together TED
demo from the team at MIT which leveraged a wearable
computer and mini-projector to create a projected aug-
mented reality allowing newspapers to come to life ala
Harry Potter or for a book jacket to don its Amazon star
rating right before your very eyes. I can’t imagine many
people will be excited about the fashion statement one
makes when they dangle a projector from a lanyard around
their neck; I do believe there is an immediate and more ac-
ceptable alternative. Who needs to drag a computer around
on their back when we already carry them in our pockets?
Yes, today’s phones have significant compute power and
there are already examples of augmented reality apps on
the iPhone and other mobile devices. I suspect we’ll see a
lot more very useful tools that leverage the ability to cap-
ture and display live video of your surroundings while le-
veraging the very interesting conglomeration of informa-
tion from the global knowledge base of the internet, GPS
data, compass information and an accelerometer, all the
while compositing the results from all these sources over
the very same images that were analyzed for the search.
Point your phone’s camera and get immediate consumer
reports information about a product, find out what sort
of odd-looking flower is on the side of the trail, or find
out how much your neighbors new car cost all in real-time
without typing a letter.
Of course, the data flow is not one-way so you may
be contributing to an ever-expanding pool of data, useful
or not. Found an odd insect? Your web-connected camera
identifies it for you almost immediately but also notes that
based on your GPS data that insect is alien to the region.
The state’s agricultural department may find this very use-
ful information. With all technologies there is a dark side.
These new-found benefits of augmented reality will encour-
age us to have our cameras pointing at our surroundings
and the people therein. While this could be a very useful
tool in and of itself, imagine users in a SETI screen blanker
style network who allow video streams of their camera to
be analyzed and searched for missing or wanted persons
(neat!) at the same time we are crossing into so very dicey
territory for personal privacy. Rats.
While it may be impossible to predict precisely where
this will end up, from my point of view it is safe to say it is
going to happen and it is going to be big.
Megapixels schmegapixels
In 2008 I purchased a Canon 5D MarkII. I’m a bit of
a photo-wonk. This camera has a full frame 21 megapixel
sensor. Shazaaam! But I didn’t buy the camera for mega-
pixels, camera companies surpassed my megapixel require-
ments a couple of years ago. I was interested in something
very new to the digital SLR world. Video. While there are
obvious reasons why this is interesting to people, I am in-
terested in something a little more subtle about the move
to incorporate video recording in a still frame camera. It
indicates an open mind to using the increased capacity of
processors, sensors and memory cards to do more than just
take larger and larger images. For now they have identified
a use for these capacities that will appeal to a large base of
people. But once people have come to expect video on all
SLRs I think there is another way camera companies can
(and will) leverage this expanding bandwidth. It is time to
make the images deeper and not just larger.
visions and predictions
january 2010
9
Prior to adding video, camera companies expanded the
data captured to disk by adding support for camera RAW
files. Essentially this is a data dump direct from the sensor
and generally provides 2-stops worth of “wiggle room” in
post. Did you shoot a little under exposed? No worries, edit
in RAW and you can fix it. But even RAW files are a little
shallow and, in fact, photographers have recently joined
the high-end VFX world in a lust for high dynamic range
images (HDRI) and many people are going to great lengths
to hack HDR images together by shooting bracketed expo-
sures and compositing them together in post. In the world
of 3D we do this so we can extract real-world lighting from
said images. For photographers it presents a wide array
of advantages from the very pragmatic to the wildly cre-
ative. Some photographers simply enjoy the ability to sub-
tly change exposures to different portions of the image so
you can see details inside a sunlit room as well as the trees
outside. In standard dynamic range images you see one or
the other. Some photographers go to extremes creating fan-
tastical compositions from HDR images that often look
more painted that photographed. As with all new enabling
technologies, it is often abused and that abuse causes some
people to recoil at the thought of widespread use but it is
the subtle and practical uses of HDR that will ultimately
convince mainstream camera makers to allow new modes
on our cameras where we can sacrifice megapixels for bit
depth. Let there be light!
• Photography and 3D.
• Environment capture.
• Post bust doom and gloom or entrepreneurial hot spot?
Oh doom and gloom, booo hooo we’re in an economic
downturn. Guess what, this is a great time for innovators
and entrepreneurs particularly now that there are signs of
that investment funds are loosening up. So what turns a
downturn into an opportunity? Prior to a downturn there
is typically a significant amount of consolidation. Large
companies get larger by gobbling up smaller (often more
innovative) companies and their talent. When the econo-
my turns, the common reaction of the large company is to
slough off people, often really good people. Like saplings
that rise up after a forest fire devastates the old growth
these “unfortunate” souls are presented an opportunity to
use their angst-powered energy to innovate and start anew.
(Full disclosure: Luxology was founded just after the Web
bubble burst in the early 2000’s so we may know a little
bit about this.)
It is very hard for a new company to get potential clients
to turn away from a tried-and-true brand leader when the
markets are strong and the money is flowing. But when the
belts are tightening these same clients will suddenly have an
intense interest in alternative products that focus not only
on innovation and quality but most importantly providing
a value proposition. Now more than ever there are oppor-
tunities for small companies, even one-person shops, to im-
pact a market. The internet provides an immediate global
sales channel, we all have super-compute power on our
desks (and laps!) and there are amazing new devices such as
Droid and the iPhone that provide a market for clever apps
that don’t take a team of engineers to create. Stop feeling
sorry for yourself and go change the world! s
10 VISIONS AND PREDICTIONS
Hossein Yassaie,
Chief Executive Officer,
Imagination Technologies
A
fter the very difficult in-
dustry—and worldwide—
conditions at the turn of
the year, things have moved
significantly in a positive direction over the last two quar-
ters. Indeed, while at the beginning of 2009 a semiconduc-
tor market reduction of 25% or more was forecast, many
analysts are now projecting the downturn impact as a 10%
or less reduction in the overall semiconductor market for
2009.
Most significantly, some analysts are now forecasting
20% or more sequential growth in 2010.
That is very encouraging, as it indicates continued and
sustained recovery.
From my point of view the key trends this year have
been, and will continue to be:
• The continued spread of multimedia everywhere: The
use of graphics acceleration has now expanded far be-
yond the PC market and into mobile; soon it will en-
compass the TV and STB markets, and more. The sales
of non-PC devices in which graphics play a major role
show that users are clearly drawn to products that
have strong visual acumen. This will be reinforced by
the next wave of even more graphically capable, highly
interactive devices.
• High performance, low power multi-stream HD video
decode and encode are also becoming strong drivers
for the future in the wake of ever growing richness
and diversity of online provision of commercial con-
tent and the popular uptake of Web 2.0 user generated
video content.
• Connectivity is becoming an essential feature, not just
an option, in many forms of consumer devices. This is
being driven by the “internet everywhere” trend which
we think will mean that within five years, more than
70% of all mainstream consumer electronics products,
including TVs, radios, cameras, printers and more will
connect directly to the internet, not via a PC. With sev-
eral major CE manufacturers already committed to in-
tegrate internet connectivity across their entire product
lines we believe that the era of connected devices has
begun.
Reflecting this trend, we expect a new class of embedded
“connected processor” solutions will arise.
The ability to enjoy the same content and comparable
services on the move as users do at home is a key driver
in the uptake of mobile products. Mobility and low power
will continue to be a major trend as users want “everything,
everywhere” applications such as advanced user interfaces,
cloud-based services, uncompromised internet browsing,
navigation and games.
Elsewhere in the semiconductor industry “Make vs.
Buy” decisions are tending more towards the buying of
major SoC functional blocks, in the form of IP, across many
key areas including CPU, GPU, video and communications.
visions and predictions
january 2010
The ability to enjoy the same content and
comparable services on the move as users
do at home is a key driver in the uptake of
mobile products. Mobility and low power
will continue to be a major trend as users
want “everything, everywhere” applications.
This is driven by time to market because it allows for the
available investment to target what really matters to semi-
conductor companies: creating domain-specific application
platforms; maximizing total solution delivery to their cus-
tomers; developing broader product portfolios; and target-
ing a wider range of markets.
The trend toward delivering more complete solutions to
help and support their customers and target markets rather
than “just” technology means successful semis—and OEMs
too—will have to increasingly focus on the key problems
they are solving and go beyond enabling technologies. Suc-
cessful identification, development, and delivery of relevant
domain knowledge will be a key factor in determining
which new businesses are successfully created next year,
and which companies will thrive in the future. s
Andy Marken,
President, Marken Communications
2010 ... the year of al-
ways-on content begins
A
fter a 12-month really
sucky storm, it’s nice to
see rays of improvement,
rays of potential. Depend-
ing on your market area, it could
be a good, a really good time to
pack it in.
3D (stereo) beyond HD
It seems like only yesterday that we—networks, stations,
cable guys, viewers—moved from standard to high def.
Oh yeah … it was.
Hollywood needed something new and different to drag
you the theater, so voila…let’s try 3D (stereo) again. This
time it will be different…trust me!
Panasonic and Sony are hyping a number of breathtak-
ing, end-to-end solutions. They proclaim that next year,
we’ll produce and consume content in a whole new way.
Professional and consumer projections will exceed their
wildest expectations … “I’ll have what they’re having!!” It’s
a lot better than the stuff in the ‘50s, seriously.
We’re quickly moving beyond the re-animated 3D (ste-
reo) stuff and the 3D (stereo) in games some have been en-
joying. We’re talking about real stereoscopic 3D (stereo),
the stuff that beautifully messes with your mind and brings
the flat screen to life.
Avatar was the real test—the money shot for 3D (stereo).
 VISIONS AND PREDICTIONS
Costly ($230 M), but the movie set the stage for what to
expect. The investments in moving from SD to DTV/HDTV
won’t be wasted. Tellywood will leverage this investment
to begin delivering better 3D (stereo) content more quickly
because ... there’s money to be made!
They’re already lining up for new cameras, some new
production mixing boards, new software, new talent. The
only things slowing them down are standards (almost there)
and tons of 3D (stereo) content worth watching. There will
be about a dozen 3D (stereo) TV tests this year.
More, better stuff next year
By 2013, you’ll wonder what you ever saw in plain old
HighDef. Right now, you’re saying “OK, crap, gotta’ buy
another new set!” But that 1080p projection, plasma or
flat screen is probably 3D (stereo)-capable. Sure, you’ll
need a reasonably priced add-on box (or two) for the data
stream; but no need to re-plumb the house. For the 2011
New Year’s football battle, you’ll be able to watch the
wide receiver leap into your lap and the cheerleaders jump
higher!
And don’t forget those great movies you’ll bring home.
It’ll all be good in HD and stereoscopic 3D (stereo)!!!
Never outta’ touch
Smartphones are going to be indispensable in 2010 with
the growing number of serious and what the *** apps
you’ll have at your fingertips. You’ll never be out of touch
again. All it took to spark the mobile industry was the
rapid outflow of apps (OK, Apple’s app store). If you don’t
have a smartphone, you will!
The biggest struggle will be in getting providers to open
their networks and the pesky proprietary OS issues. You’ve
got Symbian (Nokia), Android (Google), Apple, Blackberry,
Microsoft and who did we miss? Oh yeah, Palm. Pre did
“OK” but Pixi???
By this time next year, Palm will be swallowed up by
someone.
It’ll be a cheap way for someone to jump into the middle
of the high-end everything handset market and Palm is run-
visions and predictions
january 2010
11
With all the new content, all the new
ways to grab it, all the new ways to use
it and all the new ways to monetize it,
the industry—PC, CE, communications—
will be on the road to recovery.
ning out of runway. Best bet? HP. Second best? Dell.
Our son is constantly playing games, web surfing, tex-
ting, emailing, watching videos, everything. A growing
number of companies are implementing solid business-
oriented apps that improve communications, keep projects
moving forward more smoothly, enable better decisions,
assist management and customers, and … oh yeah, put the
24x7 world squarely in your hands.
All this data is putting a helluva’ strain on the wireless
providers.
You won’t like it, but by this time next year, data-use
limits, tiered data plans and really creative billing will be
a way of life.
Socially adept
Social media will become a money laden, robust net-
work of networks. You probably think of the Internet as
hardware, software. Wrong!!!! It’s people.
Every company—Sun, HP, IBM, Dell, Oracle—has inter-
nal and external social media networks of … people. Then,
we have the more public social media nets:
• Professional like LinkedIn.
• Social networks (and sub-networks) like Facebook,
MySpace.
• Photo/video sharing networks like Flickr.
• Entertainment nets like YouTube.
Creeping along in the background are Google-enabled
tools that they and their marketing partners will use to
improve the way they track your business and personal
actions/activities—online and on phone—making money
along the way.
Visit a web site and BAM!! you get offered a tailored ad,
a coupon or recommendation. Bite and you give them the
information they all need to complete circle. You’re on the
grid … live with it!
Sunny cloud forecasts
In 2010, we’ll finally begin to use the cloud for darned
near everything. All of the big players—IBM, HP, Google,
Oracle, Amazon, Microsoft, AT&T, others—will be fighting
to be the public and private cloud provider of choice.
Netbooks will be squeezed out by more powerful, small-
er and less expensive notebooks and more expensive, more
full-featured smartbooks. The open APIs (Application Pro-
gramming Interface) standard will be forced onto all of the
players, like it or not.
Businesses will insist that their software has to work
across any platform, any application, any service. It will be
one of those no brainer checkmarks you make in choosing
hardware, software, a provider. If it isn’t checked … adios!!!
12 VISIONS AND PREDICTIONS
Tsunami of stuff
With all the new content, all the new ways to grab it, all
the new ways to use it and all the new ways to monetize
it, the industry—PC, CE, communications—will be on the
road to recovery.
UC San Diego recently published a report that people
have increased their consumption of data to 34 GB a day.
While the volume of print data exposure is past its prime,
digital content is growing exponentially. In five years, that
data wave will double in size. Whether it’s in the cloud, in
your office, on your home server, in your portable what-
ever device, it smells like storage—hard drives, flash, opti-
cal. What’s that you say? Optical is dead because you’ll just
download the stuff.
Check your sanity:
• The bandwidth at home is 2.5Mb/s and that’s good
enough for SD content but HD? 3D (stereo)? Sorry,
that’s hours and hours of being online. (Providers are
going to start charging you big $$$ for that time.)
• You didn’t snap up Blu discs because DVD was “good-
enuff,” players/discs were too high, the content was
just okay.
• Players, recorders, discs are finally at the price point
where they’re more than just “interesting” and sales
have taken the uptick.
• 3D (stereo) could be a tipping point interest that makes
more people want to own really good stuff and the
only way you’re going to get it is on a disc.
• Not that you really care (admit it), but of all of the
storage options (HD, flash, tape, optical), optical is the
only one that provides provable long-term archiving
performance and honest-to-gawd green storage—qual-
ity media, 100 years; once written to the disc just sits
their patiently waiting for you to use it.
As for the other options, you’re saying, “heck, I don’t
need more places to store my stuff. I’ll just use the cloud.”
Problem …
All of that cloud stuff—social media, mobile access,
downloads, business transactions, entertainment—is one
huge bullseye for cybercriminals. These folks are skipping
right over individual systems (chump change). They’re tap-
ping into the big clouds and cloudettes to grab hundreds,
thousands, millions of valuable bits of data.
All the money, very little risk
The “in demand” talent in any/every organization is
going to be cyber security expertise. Sure, providers are
going to reassure you that they’ve got your back 24x7. The
problem is, they can’t figure out exactly where or how the
really creative bad guy is going strike until after he/she has
done it and by then, your stuff is gone.
So?
You’ll be buying up personal/home/office storage thin-
gies. You know, portable hard drives, home NAS (network
attached storage), flash media and yes … optical.
One happy guy
Microsoft has their worldwide team struggling to figure
out what tools and solutions they need to remain relevant,
competitive. When it comes to business needs, they are still
visions and predictions
january 2010
the clear leader. In addition, over the past few years, they
have become more flexible and more responsive. On the
consumer front, they still struggle to figure out how indi-
viduals and Google’s DNA work.
The in-between land? That’s up for grabs!
And Steve is glad he didn’t cause all of your problems.
He didn’t invent the Internet. He didn’t invent the web. He
didn’t invent Google. He’s just trying to compete, make a
buck. If bad things happen to you and your stuff … holler
at Eric!!!! s
Jake Richter,
President,
Patent Logistics, LLC
The future is the same as
it was
P
erhaps I am becoming more of a curmudgeon, but
as I get older I get more selective about who I want
to spend time with—whether on-line or in person.
My 12-year old son and his real-life physical
friends are diametrically opposite in their perspective—they
accept anyone who “friends” them (and when did “friend”
become a verb anyhow?) on Xbox Live, World of Warcraft,
or whatever other on-line social network they are part of.
I also find that I fight a constant battle against infor-
mation overload—whether from news services, blogs, Fa-
cebook updates, Tweets, or e-mail—to the point that I’ve
gotten selective about how much new information I expose
myself to, and when. I therefore miss a lot of stuff my fami-
ly considers highly important, such as a video of an octopus
carrying a coconut shell or the trailer for James Cameron’s
Avatar. And don’t even get me started on e-mail—although
I will say that by installing filters on my mail server I limit
my daily intake to what I deem to be high priority e-mail
(like from my wife ... and Jon Peddie, of course) and the
rest of it collects virtual dust until I decide I have nothing
better to do—two weeks of low priority e-mail amounts to
about eight thousand messages, most of which I file or de-
lete without reading.
However, on-line communications are an addiction too,
and I find that for all of my curmudgeonliness, I need to be
able to have regular access to Google and my high priority
e-mail, regardless of where I am.
With my world travels over the last few years, connec-
tivity has generally not been an issue, and I have even been
able to get online from places as remote as Machu Picchu,
the Galapagos Islands (while on a boat, no less), Morocco,
and Fiji. I expect to put that world connectivity concept
to the test in February when I will be aboard a boat in the
Antarctic for a few weeks. A satellite tracker I wanted to
buy was not guaranteed to work that far south, so I guess
I’ll be following in the proverbial footsteps of Scott and
Shackleton in possibly not having Internet access at the
South Pole.
But I digress. I have been told that this column is sup-
posed to consist of my predictions for 2010, so here goes:
Personal, in-the-home, 3D (stereo) displays will con-
tinue to be a source of great interest to technology pundits,
 VISIONS AND PREDICTIONS 13

and will continue to lack any real penetration into the immediacy of content available on my Kindle DX. But of
home in 2010. Why? Because common folks are just now course, with more content bring produced by more peo-
getting themselves into 1080p flat panels (and 2D) and 3D ple, there’s also more crap, er, noise out there too, which
(stereo) content will continue to be a slow dribble. 2009 gets back to the whole intelligent filtering technology
hasn’t really even made it as the year of high definition yet, prediction.
although cheap Blu-ray players this Christmas are helping. Let me close with an observation on mankind’s self-delu-
I predict 3D (stereo) home displays will remain a novelty sion. The climate talks in Copenhagen ended recently, with
until at least 2012, when the Mayans allegedly predict the little in the way of what anyone considers success. But the
world will end, in which case it just won’t matter. reality is that in order to solve a problem you need to un-
Everyone will continue to be all atwitter about spend- derstand both its genesis and ramifications. Without such
ing face time in their on-line social spaces, linked into knowledge, and consensus that such knowledge is accurate,
everyone else, and countless hours of productivity will all you can do is guess at options, and hope something you
continue to be wasted in business and personal lives. The implement works, assuming you can get it implemented.
big development in this arena in 2010 will be the slow but However, worse yet is when people who are not nearly
increasing proliferation of information filtering technol- as smart as the scientists studying the issue try to condense
ogy to feed people only the information they think they things into sound bites and chunks which are perceived to
want from all the various social networks and news sites be more manageable. Which is why politicians, among oth-
out there. Right now the filtering technology, for the most ers, are issuing a loud cry for reduced carbon emissions.
part, has to be manually set-up (e.g. Google Alerts), but All the while ignoring the fact that the average, ordinary
there’s a huge future for intelligent agents, which can use human being is an excellent carbon emitter, whether in
AI methods to learn more about likes and dislikes. A hint of life—breathing, belching, and breaking wind—or in death
this already exists in application sites like Pandora, where (by, for example, decomposing). Let’s hope politicians and
intelligent heuristics use your likes and dislikes to tailor the governments they implement don’t start taxing us for
music stations to your desires. And Facebook has a “like” exhaling, burping, or farting as part of the whole cap and
indicator you can apply to senseless drivel you may enjoy, trade approach.
and there’s a large outcry asking for a “dislike” option too. And while everyone continues to bicker about prop-
Once that becomes implemented, can preference-based in- er ways to reduce greenhouse gas emissions, the world’s
telligent filtering be far behind? oceans creep ever higher, slowly displacing ever-greater
The English language will continue to devolve on-line. numbers of people. Perhaps more attention should be paid
I used to think it was just a transitory phase for teens, but to those who are losing their homes, or even their nations,
when I recently received an e-mail from a founding part- to rising waters and help them adapt to the new reality of
ner of a mid-size law firm in New York written in “short- less land and more water? That’s probably something that
lish” (shorthand English), I knew the English language as won’t be happening in 2010, I bet. s
we knew it was doomed. And apparently giving folks key-
boards—physical or virtual—doesn’t prevent them from
being too lazy to spell out words and use proper punctua-
tion. No surprise there, I suppose.
Physical media sales will continue to drop. Microsoft
has it right. There is no need to put to put a Blu-ray disc
drive in the Xbox 360. Just download what you need—or
stream it if your connection permits, and even Sony is head-
ing that way. For myself, I know that compared to prior
years, where I would purchase dozens of new DVDs and
high definition movie discs, in 2009 I purchased a mere
fraction of the discs of prior years. Instead, I have made
sizable donations to Apple’s iTunes and Amazon’s Digital
Downloads in exchange for TV shows and movies in both
standard and high definition because of the convenience
and portability of downloaded content (I can’t stream well
enough where I live to make that viable). And more people
I speak with say they are doing the same. And with compa-
nies like Redbox making physical media rentals as cheap as
a dollar, it makes even less sense for someone to shell out
big bucks to own a physical copy of a movie (other than
companies like Redbox, for example).
Content will still remain King. Witness the big three
game console makers, all of whom continue to transition
their now ancient (in Moore-years) hardware platforms to
finally becoming centerpieces in the average living room,
all thanks to ever more pervasive content aggregation
ranging from games and movies to YouTube, music, social
media feeds. I will add that I am also a big fan of the Apple
TV and SlingCatcher, both of which thrive (and depend)
on content. And I’m not sure what I would do without the

visions and predictions

january 2010
14 VISIONS AND PREDICTIONS
Ted Pollak,
President, EE Fund
Management LLC
2009 Video Game Industry
Review and Visions for the Future
I
’m going to go against the grain here and say 2009
was a pretty good year for the game industry, but …
we just don’t know it yet. NPD will not make an an-
nouncement that they undercounted sales by billions
and the game publisher CFOs will probably not suddenly
re-state financials, goosing up earnings per share as a sur-
prise holiday treat. (Though that would be a sight to see be-
cause re-stated financials are almost always negative).
The reason that 2009 was a pretty good year for the
game industry is that it experienced growth across all plat-
forms (mobile, handhelds, consoles, and PC) in global mind
share. This mind share is the “awareness of and desire to
use” these magical pieces of hardware and artistic software
products to have fun. The growth in mind share will even-
tually translate into sales. So whether it’s 2010 or later
that the industry meets and exceeds its historical financial
growth, when that time comes, 2009 had something to do
with it. Simply put; there is a buildup in demand going on.
Mobile and handheld
2009 saw JPR’s prediction of Apple dominance in mo-
bile games manifest. Some lay credit to the hardware, with
the iPhone/iPods great screen and accelerometers enabling
a new paradigm in mobile phone gaming. Some point to
the software with thousands of fun and innovative games
available. For me it was mostly a function of the software
pricing model that won Apple dominance in this space.
I’d like to clarify how I am defining dominance in this in-
stance. Dominance is simply being the highest quality and
most adopted mobile gaming experience in relation to the
competition. It does not necessarily mean a lot of money;
though that is relative depending where you sit on the value
chain.
This brings us to an observation about business models
in the mobile game industry (and handhelds /consoles as
well). The traditional “Razor and Blades” model (selling
initially subsidized hardware to profit from software) has
been done. The second gen consoles did this. The “Blades
and Razors” model (creating such desirable software that
people buy the hardware) has been done. Nintendogs for
DS, Wii bowling, and Halo are a testament to this.
Perhaps the new model could best be described as “Ra-
zors and Blades and Toothpaste and Shaving Cream and
Mouth Wash and on and on and on.” The phenomenon of
convergence is squarely upon us. So it becomes harder to
analyze the video game impact. If gaming efforts for a de-
vice break even but there is profit from a diet and exercise
program used on the device, and the device’s purchase mo-
tivation was swung by the games; holy multi-faceted pur-
chase intent Batman! Industry analysts have their work cut
out for them.
OK, enough about Apple. At the end of the day the
depth of the gaming experience just doesn’t cut it in rela-
visions and predictions
january 2010
tion to Nintendo and Sony handhelds. Mobile gaming for
something to do on the train and in line at the store yes; a
deep and immersive gaming experience: NO. Accelerome-
ters and touchscreens just aren’t enough to make the games
really deep. Take MLB The Show for PSP as an example.
This baseball game is so challenging that it makes use of
all the PSP control surfaces (at least 10 buttons and a joy-
stick) and often requires a combination of them. Hardcore
gamers are not satisfied with an “easy button” that allows
a perfectly placed split finger fastball with flip of an accel-
erometer. They WANT challenge, realism, and immersion.
Hardcore gamers are, always have been, and will always be
the cash cows of the industry. Perhaps voice controls, fuel
cells, or Bluetooth game controllers are the answer? Add to
this that people generally don’t want to drain the battery of
their precious communication devices messing around with
entertainment, and the handheld gaming industry is still on
very solid ground.
Consoles
High Definition television penetration is a key element
here. It has been slower than many predicted. However, I
believe we are facing an anomalous spike in HD penetra-
tion because of the pricing environment. Low-end 40 inch
1080p panels are now hovering around $500. This repre-
sents a tipping point despite the Great Recession. Once the
panels are in people’s homes the next logical step in home
entertainment build out is to buy a HD capable game con-
sole. Nintendo has enjoyed not being subject to this formu-
la as the Wii was designed for standard definition.
So out of all of the elements, which influenced the
“growing without even knowing” theory, I believe the larg-
est influence on this is the desire and awareness of gaming
on your TV with third generation hardware. The consoles
offer a high quality experience for an affordable price and
I predict that all three platforms (PS3, Xbox 360, and Wii)
will flourish in the coming years. Because of Blue-ray, ex-
panded services, and quality games, I think 2010 will be a
great year for the PS3.
On the software front, the greatest accomplishments
in console gaming in 2009 were the big peripheral games.
Rock Band Beatles, DJ Hero, Tony Hawk Ride, etc. These
games all come with unique peripherals, which represent a
true shift in console gaming. Again, we are separating in-
novative and technological success with financial success.
Some of these titles didn’t move the units hoped for. “Mov-
ie-esque” gaming should also be mentioned with Uncharted
2, Assassins Creed 2, and Modern Warfare 2 all paving the
way toward the fusion of games and Hollywood.
PC gaming
Behold the PC, the most fantastic, powerful, innovative,
supercalifragilisticexpialidocious gaming device on planet
Earth. The most pixels, the most flops, the smartest AI; the
cutting edge of computing technology and the software and
accessories to make it shine; this is what makes PC much
more fun for some people than consoles. While the main-
stream press often ignores the PC, there were some very im-
portant innovations in 2009.
Both AMD and Nvidia are pushing the pixels even fast-
er and AMD and Intel continue to allow massive loads of
background gaming calculations with their advances in
CPUs. LCD panel pricing has brought 1920x1200 resolu-
tions down to about two hundred bucks. Alienware contin-
 VISIONS AND PREDICTIONS
ues to market and innovate; leading the U.S. system con-
figured mass market boutique performance and enthusiast
name brand arena. We saw a very strange decision by HP to
seemingly eliminate their efforts in this space after consid-
erable investment into this area. Cutting back on their gam-
ing division would have been more logical than dissolving
it and I think they will regret letting Dell be the last man
standing. Of course they could reverse this decision, and
still have lingering IP recognition with consumers for their
Blackbird and Firebird brands.
PC gaming hardware grew just over 5% in 2009, which
is respectable given the dreadful economic environment
and JPR expects 2010 to be an incredible year with growth
around 30%.
For peripherals it was a good year. While flight simula-
tion is a niche, it is also a high margin niche. Logitech came
though big time this year with a nice flight simulation con-
troller called the G940 which eliminates the bane of flight
sim enthusiast—the dreaded “pots” in their flight sticks.
These pots are the contact points and eventually wear out
and fail. Logitech, as far as I know, is the first mass mar-
ket company on the block to use a magnet based system to
track movement instead of pots, which makes the action
contactless and the product truly innovative and advanced.
Natural Point was in the mix as well with the TrackIR 5
head tracking device. It’s really a leap to play an FPS with
free head movement, and ARMA 2 supports TrackIR on
foot, and in vehicles.
On the software front a few advances stick out. ARMA
2 and Operation Flashpoint are both highly complex mili-
tary simulations (which also happen to be huge system
hogs). These were bright spots for the war gamers in a year
that marked the Call of Duty franchise seemingly become
console-ized. The STALKER modders of course were also
hard at work, as were the MMO companies with expan-
sions on many products.
I think there is an opportunity for PC game develop-
ers to support the mod community and make some money
in the process. Instead of eliminating user generated con-
tent they should embrace it and allow people to give their
creations away for free if they desire. However Publishers
should also offer the option of partnering with modders
and taking a percentage cut of a mod sale. Sound familiar?
Yep, that’s the Apple App store model. Developers could
reserve a few bells and whistles for their own paid mods
as well to give them an edge on the homebrew folks. In the
end this approach makes sense for all involved. Publishers
need to remember that free add-ons enhance the brand and
translate into sales down the road.
Conclusions with a brief look at the
“social games” phenomenon
Something is seriously fishy with this whole Zynga hype
and social games in general. Having just raised $180 mil-
lion from Russian investors, Zynga has an estimated valu-
ation of around $1 billion. This all seems strangely famil-
iar if you remember all the enthusiasm around the time of
the JAMDAT acquisition by Electronic Arts. Ridiculous
valuations coupled with ethereal demand for product. Now
brace yourselves, here comes my conspiracy theory. Zynga
may have a closer relationship to Facebook than has been
made public. And in fact there is one link. Zynga’s Russian
investors Digital Sky Technologies also invested $200 mil-
lion in Facebook. I get bombarded on Facebook every day
visions and predictions
january 2010
15
with adds for Zynga games even though I click them off
and ask Facebook to hide them.
So, for 2009 Apple sits at the top of mobile gaming but
this will dilute in 2010 with Android in the mix. The hand-
held companies are both in comfortable enthusiast and
mainstream markets with the Nintendo DSi and Sony PSP.
The consoles had a tough year on sales but a good year on
mind share expansion and demand build up. 2010 will see
all platforms sell well with special emphasis on the Playsta-
tion 3. 2009 was good for PC hardware and a struggle for
the right business model on the software side. 2010 will
be a fantastic year for PC gaming hardware. Social games
will see the hype bubble burst, if not in 2010, soon after.
OnLive, Gaikai, and the other streamers will also be inter-
esting to watch though I don’t expect anything soon. I am
monitoring bandwidth penetration, speed, and network
consistency as the levers for these efforts. Based on the fact
that my Comcast connection already becomes pixilated and
with connection interrupts occasionally, we (as a nation)
have some data infrastructure work to do. s
Easy predictions
Jon Peddie, President and CEO, Jon Peddie
Research
A
friend of mine, a
very smart, and
successful per-
son, told me, do
the hard stuff—don’t go
where everyone else is,
go where they’re afraid
to go. He was, and con-
tinues to be right.
It’s true in forecast-
ing too.
The easy forecasts
look at today’s trends
and extend them to log-
ical, or even illogical
futures, a linear regres-
sion model. But the future doesn’t work that way, never
has, never will. Heisenberg, Schrödinger, and Robert Brown
have proven that.
So I’m forecasting predictions that will not come true.
Cars will replace horses, electricity will eliminate candles
That never happened, but widely forecasted by all the
smart people.
All physical media will disappear
Newspapers, books, DVDs and CDs will go the way of
the Dodo and 8-track. Oh, right, and TV will replace the
movies, video will kill radio, and supersonic flight from
New York to Tokyo will be a common thing.
Easy predictions; too easy—you should see a big flash-
ing red sign—Beware, Danger.
One of the points I try to make to the press and inves-
tor community when asked for who will be the winners
and losers in computer graphics is, you can’t assess the in-
16 VISIONS AND PREDICTIONS
dustry that way—it has too many moving parts. We have
too many choices, from netbooks to workstations, mobile
to desktop to embedded, powerful discrete GPUs to in-
tegrated and soon embedded GPUs. There’s a reason, we
have hundreds of millions of consumers of PCs and they
all want a little something different, different functionality,
different prices, and even different looks. Will ray-tracing
replace CGI, will the Macbook Air kill netbooks, will Lar-
rabee kill gaming GPUs, will laptops kill desktops? Absurd
questions? Maybe, but I make a pretty good living answer-
ing them.
Will the Internet kill DVDs, books, and newspapers? Is
that an absurd question? Before you blow out the candle
and answer, think about it. Oh, and while you’re thinking,
will you turn down that rap music that uses a turntable for
cuts and mixes?
But it’s also too easy to say nothing goes away. Eight-
track did go away, although cassettes seem to live longer
than anyone thought. And vacuum tube amplifiers, al-
though beloved by rock & roll musicians have a question-
able future. Why? Things go away when no one makes
them anymore. I know, yet another brilliant observation,
thank you. People/companies stop making things when the
cost of manufacturing exceeds the sales value. (Interesting
side note—some companies are still having to be taught
that just because some customers want your widget, you
are not obliged to make it if you lose money on every one
you build.)
Compulsives and the insecure will want 24/7 connectiv-
ity and insist on telling you about the new shoes they’ve
bought, or what a PITA their boss is. But they would have
done that on the phone, in person, or in a letter a few
years ago. Nothing has changed on that front other than
the media. Did you get any Christmas cards this year? You
probably did, and you also got a few email pictorial greet-
ings with a meaningless suggestion to have a happy holi-
day, love one another, and don’t pick your nose in public.
It’s not the medium or the message, it’s the sentiment, the
contact, the reminder that someone is, even if superficially,
thinking of you (and they’d probably like you to think of
them, or their company).
Intimacy
Will books go away? Doubtful. People like books; they
like the texture, the colors, the prestige, just as they like
the feel and status of horseback riding, and candle lit din-
ners. Things that have an intimacy to them, warmth (like
vacuum tube amplifiers, and that is not a pun), comfort,
will endure. TV will endure, but so do movies, and radio.
We become close to the things we live with.
So when trying to predict the future, look for the rela-
tionship people have with the item you think is a potential-
ly endangered species.
But take care. Just because your granddad preferred
hand milking to using a milking machine personal usage
is not a safe conclusion about the future success of a new
product. You have to balance costs, convenience, efficiency,
and style. And, you have to figure out where the new thing
is on Kathleen Maher’s practicality gap curve. Maybe it is
really is a great new thing, but is the technology, the dis-
tribution network, the cultural acceptance in place for it to
be successful, and potentially a vehicle of obsolesce for the
current thing?
visions and predictions
january 2010
Too many moving parts
What Heisenberg, Schrödinger, and Robert Brown tried
to point out, and former Secretary of Defense Donald
Rumsfeld tangled himself up with is, we don’t know what
we don’t know so don’t be so damn cocksure of yourself as
my grandmother used to say.
Paralysis
The flip side of course is paralysis by analysis. If one
tries to weigh all the probabilities it doesn’t take long to
realize you don’t have enough data, enough, or accurate
enough. That’s when intuition is called for. That’s when its
ready-fire-aim time.
It’s hard predicting the future. But if you want to be suc-
cessful, you do the hard stuff. And if you get it right, and
you won’t very often because it IS hard, if you get it right,
you’ll be very successful.
So what’s my prediction? Pigs will fly. We will be to-
tally connected to each other, for as much of the day as we
individually choose. Our connection will be multifaceted,
electronic, visual (think signage), physical (think books and
newspapers, and the odd post card or letter), and of course
audibly either in person, or in a crowded area with your
mobile phone (and your fellow travelers so appreciate hear-
ing you describe what Jim was doing at the office).
The cleverness and novel ways of the connection will
astound us. Augmented reality in our sun glasses, mobile
phones that double as a hearing aid invisibly tucked in or
behind our ears. Cameras woven in our clothes, and trans-
lation services in the cloud to tell us what that street sign
says in our language. And when we get on the train, bus,
subway, ferry, or airplane we’ll still read a newspaper or
paperback book for as long as someone can make a profit
building them—even though all those vehicles will have
wireless Internet coverage.
Epilog—some small advice. If you’re not in the forecasting
business and you make a prediction, you’re probably wrong.
If you are in the forecasting business, spend more time trying
to disprove your prediction then promoting it. s
With special thanks to the work of Frank Stella. We have used
photos of his sculpture displayed on the roof of the Metropolitan
Museum of Art, fall 2009, in New York to illustrate the entangled
ideas of new technology.