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SONICblue Music Device Advances Its Digital Strategy

Consumer electronics company SONICblue Inc. on Monday unveiled a high-end home entertainment hub that can store an entire music collection and furthers the company’s thrust into the budding market for digital audio and video entertainment.

At about $1,500, SONICblue’s Advanced Digital Audio Center can become the centerpiece of a music enthusiast’s wired home. It features a 40-gigabyte hard drive that can record up to 650 hours of music.

Through the system, available only via SONICblue’s Web site, music from a CD can be recorded to its hard drive, played back over receivers within the house, downloaded to an MP3 player, or reorganized and burned onto another CD.

Andy Wolfe, chief Technical Officer of Santa Clara, California-based SONICblue, said the new model binds its audio strategy, which includes portable digital music devices such as its Rio line of CD and MP3 players.

“This is a device that take our individual products and ties them all together into a system,” he told Reuters. “As you start to build a personal collection of digital music, you can share it in your house, take it to your car, take it to the gym with you or burn CDs for an airplane.

From DVD players to online radio stations, digital entertainment distribution is a area of rapid growth for consumer hardware makers and audio and video content providers, as consumers embrace new technology that allows them to carry personalized music collections and share with others.

Toward that end, the Advanced Digital Music center is equipped with a modem, which will allow it eventually to send and receive music over the Internet. Users can someday buy and download tunes, and “stream,” or broadcast, them to others. “Today that doesn’t mean a lot other than the ability to identify your CDs,” via an online catalog service, he said. “But in the future, it is a way to acquire content from the Internet without needing to have a PC involved.”


SONICblue has made lots of noise this year, its first since it changed its name from S3, amid a strategic switch away from making graphics chips and toward digital entertainment, such as its MP3 players and its recently launched TV recording product, ReplayTV.

Much of that ruckus, however, has been in courtrooms rather than retail showrooms. SONICblue last week sued rival TiVo Inc., charging it uses technology that infringes on SONICblue’s television recording patents.

Further, SONICblue in October was sued by the major television networks, which claim Replay TV allows users to improperly duplicate and distribute copyrighted material, as well as skip advertisements, thereby robbing the networks of revenues. The networks seek to halt the sale of the recorder.

SONICblue insists that this time around, it expects to avoid that kind of controversy. While the device is technically capable of being a distribution center for digital music, it is limited for now to sharing tunes within the home.

“It is not a Napster server,” he said, referring to the popular service that was sued by the music industry for fostering copyright infringement by its millions of global users. “We have been very careful with this product to try to respect copyright because we believe that an important part of the value of this product is to purchase music on it.”

“We believe we have followed the law, but we still have tried try to make available all of the things that customers do,” he said.

Despite its legal concerns, SONICblue’s toughest challenge will likely come from its stiff competition, deep-pocketed consumer electronics giants such as Philips Electronics, Compaq Computer Corp., Sony Corp. and Microsoft Corp.

Wolfe said the company would etch out its place in the market by providing digital products with that stress compatibility with emerging Internet-based services.

“Old-line consumer electronics companies have gained their market shares through manufacturing efficiency and through expertise of hard goods. That’s no longer the value in these products,” he said.

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