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Tech – Home Entertainment Goes Wireless

Neal Sandler

Wouldn’t you love to get rid of the rat’s nest of cables connecting the pieces of your home entertainment system—and cut the hassle of hooking up new audio-video components? Engineers and consumers alike have dreamed of that possibility for years, but a handful of serious efforts up until now to devise wireless consumer electronics schemes have foundered on technical shortcomings and divisive standards battles.

Now a venture capital-backed Israeli startup, Amimon, is driving the latest attempt at a cord-free home entertainment standard—and this time it looks more likely to fly. The chipmaker’s Wireless Home Digital Interface technology, or WHDI, was co-developed with a who’s who of consumer electronics companies, including Hitachi (HIT), LG Electronics (LGEAF), Motorola (MOT), Samsung (SSNLF), Sharp (SHCAF), and Sony (SNE). The first TVs and laptops to use it should start appearing on store shelves in early 2010.

Eventually, WHDI could show up in everything from Blu-ray DVD players, set-top boxes, and gaming consoles to video projectors, camcorders, and portable audio players. Amimon expects the technology to add $20 to $40 to the cost of an electronic device at first, with prices falling rapidly as volumes increase.

What sets Amimon’s WHDI apart from previous wireless A/V proposals is its speed and quality. Earlier efforts, such as the attempted WiMedia standard that built on Ultra-wideband (UWB) technology, streamed video in compressed form, which resulted in signal latency and a loss of clarity. WHDI is the first that sends digital video—including high-definition (HD) programming—flying around the house uncompressed at data rates of up to 3 gigabits per second. That means there’s no time lag and the images are crystal clear. The radio waves can pass through walls and have a range of about 100 feet (30.5 meters).

recession dashed early hopes
Founded in 2004, Amimon is led by Yoav Nissan Cohen, a 20-year veteran of Israel’s high-tech industry who previously ran Tower Semiconductor (TSEM). Nissan Cohen also helped launch Saifun Semiconductor—now a unit of Spansion—and did stints with National Semiconductor (NSM) and General Electric (GE). A former Israeli Air Force fighter pilot with a doctorate in physics, he’s convinced that Amimon could be one of the biggest success stories to come out of Israel in years. “It’s the first time that an Israeli company will determine a global standard in the consumer electronics market,” he says. “Sales could run into the hundreds of millions of dollars within a matter of years.”

Of course, some things don’t always go as planned. Amimon had been counting on a big breakthrough this year as consumer electronics companies began building its WHDI wireless video modems into their products. But that hope was dashed by the economic crisis.

“The global recession forced Japanese electronics companies to cancel plans for introducing new products, so this set our timetable back,” Nissan Cohen says. Sales at privately owned Amimon will amount to just several million dollars this year, and the company was forced to freeze hiring after nearly doubling its workforce in 2008.

There are also threats from rival solutions. Members of the defunct WiMedia Alliance, including Texas Instruments (TXN), continue working on alternatives. Some observers, such as Kurt Scherf, vice-president and principal analyst at Dallas-based consultancy Parks Associates, also foresee competition from enhanced versions of the popular Wi-Fi standard now used for wireless networking in hotspots.

But the most significant challenger is a competing high-definition wireless standard called WirelessHD, promulgated by chip startup SiBeam of Sunnyvale, Calif. SiBeam’s technology operates in a different frequency band from WHDI but otherwise offers similar features and capability to consumers. The WirelessHD Consortium, which has developed around the technology, includes three of the companies supporting Amimon’s WHDI—Sony, Samsung, and LG—plus heavy hitters Intel (INTC), Broadcom (BRCM), Panasonic (PC), NEC (NIPNF), and Toshiba (TOSBF).

reducing cables in operating rooms
Analysts aren’t willing to pick a winner yet but agree that the time is right for wireless home entertainment. In part, that’s because the technology has finally become as good as cables. Widespread consumer acceptance of other wireless standards in recent years, including cordless phones, Bluetooth, and Wi-Fi, also has whetted the appetite of buyers. “There’s no doubt that the wave of the future is wireless and it will take off rapidly in the coming years,” predicts Oren Raviv, emerging technologies analyst in the Israeli office of market researcher IDC.

Still, just to be on the safe side, Amimon isn’t putting all its eggs in one basket. Although it’s pushing hardest on consumer electronics deals that could yield sales in the hundreds of millions of units, it won’t look askance at opportunities in other industries. Case in point: Amimon was approached last year by Kalamazoo (Mich.)-based medical equipment giant Stryker (SYK), which was looking for a way to reduce the cabling used in surgical systems. “There are a lot of wires and tubing hanging around the operating room and they can slow down surgeons and make it difficult to keep the sterilization field clean,” says William Chang, chief technology officer for Stryker Endoscopy, a unit of the company based in San Jose, Calif.

Stryker signed an exclusive deal with Amimon in December to use its wireless technology in operating rooms and began shipping high definition displays that incorporate WDHI technology earlier this year. Nissan Cohen says this and other medical deals could someday be worth tens or hundreds of millions of dollars in annual sales for Amimom—and with better profit margins than for consumer electronics.

Amimon’s potential in all different industries has prompted Israeli and American venture capital companies to sink $50 million into the company so far. In July, Amimon closed its most recent round of funding, raising $10 million from a group of firms led by Boston-based Stata Venture Partners and also including Motorola Ventures, Evergreen Venture Partners, Walden Israel, and the Cedar Fund. Nissan Cohen hopes eventually to take Amimon public rather than sell out to another company, but an initial offering isn’t likely before 2011.

Even as investment banks circle, Amimon’s biggest tests still lie ahead: Global consumer electronics giants in the Far East must give WHDI a strong vote of confidence, and consumers have to adopt the technology in droves. If that doesn’t happen, Amimon could become the latest tech firm to be zapped by the challenge of banishing wires from home electronics.

Sandler is a correspondent for BusinessWeek in Jerusalem.


October 20, 2009 - Posted by | Uncategorized |

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