Toshiba announced recently that they will deliver (this year) a tiny (.85 inch) disk drive with a 4 gigabyte capacity.

This will further enable mobile network connected, hand-held devices that today hold both the operating system and applications in local memory, leaving relatively small working space for computation and data.

The small disk drive, coupled with Intel's next generation of mobile chips, 3G standards and higher bandwidths and speeds would indicate that hand-held devices are the next battleground for major players in both hardware and software.

It is likely that by the end of this decade - 6 years away - hand-held devices will perform on a par with today's larger and more powerful workstations. Should Microsoft carry forward their announced Entertainment PC strategy, it is likely that hand-held devices will provide multiple media (real-time video), PC-like applications, as well as time and place information.

Yesterday we wrote about developments in thin, flexible, low-power polymer-based displays that have the potential to solve the major draw-back inherent in today's small screen devices.

All the pieces are comming together. It indicates that a robust, multi-function, mobile device will shortly provide a repetoire of media and applications beyond today's heavy duty workstations. How soon? We feel Microsoft signaled initial attack when Bill Gates addressed the Consumer Electronics Show in January and moved the goal posts out to the Entertainment PC. In essence, this moves the PC from the home office into the living room. The strategy greatly enlarges the potential market for PC's.

The CIA's public database indicates that nearly 100% of American households own Color TV's and the NAB database indicates 5 radios per household. Microsoft isn't missing the magic moment as we all consider purchases of HDTV and Digital TV and they and the PC industry want a large share of that conversion.

The convergence of media is also being pushed by Nokia (video telephony) and Apple's iPod, and some other manufacturer's attempts at a video version of the iPod. How soon do you think all of this will merge? Can't be long, the move is so obvious and Microsoft's software architecture is precisely aimed at this target.

"If we can't sell PC's to everyone as a computer, then we'll sell them the entertainment center equiped with software that runs circles around relatively dumb TV sets." The quotes are ours, the marketing savvy is Microsoft's. We think they are dead nuts on the right target.

From a Digital Marketing perspective, these developments show every indication that network attached, hand-held devices will provide a new, individually addressable customer that opens the way to market and sell into this large and growing (2 billion by 2010) consumer base.

Terry Wellman

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Terry Wellman

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