Intel's set-top box can identify the gender of a television viewer and distinguish between adults and children. But less clear is if there is money to be made in this, writes Tony Glover
A Intel has developed a television set-top box designed to watch the viewers while they watch TV, fulfilling one of the predictions of George Orwell's book 1984.
Although the new technology cannot as yet pinpoint individuals in the same way as the two-way tele-screens in Orwell's novel, it can identify a person's sex and differentiate between adults and children.
Intel is hoping that this feature will appeal to advertisers keen to target specific consumer groups. A TV advertisement could flick between Christmas toys, car repairs or perfumes, depending on who happens to be seated in front of the TV screen.
There is even speculation in Silicon Valley that the giant American chip maker may already be partnering TV production companies to create interactive TV shows adapted to the age and sex of the audience.
But Intel is entering a tough arena by attempting to break into the pay-TV market, and even its ground-breaking new technology may not be enough.
Not only does the company have to compete with information technology rivals such as Apple and Microsoft, both of which already have smart devices connected to the TV offering a growing range of services, but it also has to go up against established content providers.
The Silicon Valley analyst Rob Enderle of the Enderle Group says "set-top boxes are a very painful area. The dominant product from cable, phone and satellite companies is subsidised and heavily cost-constrained".
He adds that the pay-TV market is made even more problematic for Intel by the difficulties inherent in cutting new deals with established content providers.
"In addition, the existing ecosystem is still heavily tied to these same providers … A major part of the problem is that data access and content access is generally bundled and difficult to unbundle inexpensively."
Intel faces the same problem as other newcomers, he says, in striking a sufficient number of content deals to provide a broad enough spectrum of entertainment to cater for the mass market.
Film studios, production companies and TV channels have often signed binding contracts with traditional pay-TV players and may be reluctant to switch allegiances to a relatively unknown player in the industry.
"Intel has a great platform, but before that even matters, the content-access and data-only costs need to be better mitigated," says Mr Enderle.
However, Intel is looking well beyond the pay-TV subscription market. The company hopes that its chips will come to dominate the home entertainment model just as it once ruled the personal computer market. Seen in this context, its set-top boxes can been regarded as a bridgehead into a much bigger world of interactive home entertainment. According to industry watchers, today's set-top boxes are, in any case, merely an intermediate technology.
James McQuivey, an analyst at the international research company Forrester, says set-top boxes, among them the Apple TV, Boxee and Roku players, were "always destined to be a transitional category while other devices eventually made these products into features on their game consoles, TVs, or other living-room devices".
Forrester reports that just 4 per cent of the online public in the United States actually owns one of these devices. It therefore seems unlikely that making inroads into such a limited and transitional marketplace is the justification for the research and development needed to produce the kind of innovative interactive technology in Intel's new set-top boxes.
Existing set-top technology will eventually be incorporated into other devices, primarily smart TV sets. These bear little relation to traditional TVs except in their appearance.
Viewed in this wider context, viewer recognition could have a far wider role to play in the home.
When, for instance, a child attempts to click on inappropriate online content, the set-top box or smart TV could deny access. Interactive games could also identify the age and sex of players.
Intel's old partner Microsoft has already made big inroads into the home entertainment market with its series of Xbox games consoles.
As more people use living-room screens connected to the internet to watch films on YouTube or access social networking sites such as Facebook, Microsoft is convinced that consumers are on the cusp of entering a highly advanced world of in-home communications and technology. Already, three-dimensional viewing and gaming are entering the living room via connected TV sets.
It is also likely that Intel and others will continue to develop facial recognition technology to a point where it will be possible to personalise entertainment.
Once the technology is sufficiently advanced and cost-effective to develop for the mass market, it will be possible for set-top boxes and internet-connected TVs to distinguish between individuals. This will also allow advertisers to personalise their offerings.
When this happens, we will have entered a world where the TV is watching you more closely than you are watching it.
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