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Joining Forces, Digitally, in Vegas

By Heather Green As the last touches were being put on the three massive convention halls for the 2005 Consumer Electronics Show (CES) in Las Vegas, scurrying workers moved heavy rolls of carpet to halls and booths and installed benches along the sidewalks. Although CES doesn't officially start until Jan. 7, the press and company execs were already streaming into the sprawling complex in the Nevada desert.

While just a few thousand were at the big show Jan. 5, they were the vanguard for the 120,000 expected to walk the convention floor over the following four days. The key electronics show of the year, CES is a coming-out gala for hot consumer tech trends and the next crop of digital gadgets and services.

NETWORKED NESTS. This year, as never before, the convergence of many different industries is on display. CES was once the showplace of the traditional consumer-electronics industry. Now it's flooded by the titans and startups of the telecom, computer, and even media sectors. The signs and outdoor pavilions of Microsoft (MSFT), XM Satellite (XMSR), and Nextel (NXTL) rival those of consumer-electronics giants Sony (SNE), Toshiba, and Panasonic (MC).

On early display were the show's award winners, culled from the products of 2,400 exhibitors. Among the big themes: The continued march to intelligent home networking and home appliances, such as refrigerators and heaters; sharper, bigger, smarter digital TVs; and the delivery of content to all these newly digital devices.

Innovation in home networking is a key trend this year. The Consumer Electronics Assn. expects that by 2008, over 50% of U.S. homes will have home networks, with people zapping digital music, movies, and photos around the house.

TRACK AND MONITOR. One CES award-winning product designed to help manage all those moving digital bits is Universal Electronics' (UEIC) Nevo -- a sleek, turbocharged remote-control device for the Digital Age.

By using Wi-Fi networking and infrared signals, Nevo can connect devices, allowing users to track and find digital files within a home and stream them onto networked devices such as PCs and TVs. Companies that make gadgets such as personal digital-assistant (PDAs) can also embed Nevo's technology in their products and turn them into remote controls.

Some wireless-networking trends that have been years in the making are becoming reality at this year's show. They include matchbook-size sensors that use the new Zigbee technology to track and monitor information such as temperature, water levels, even motion detection and, in turn, send that data to a central computer, PDA, or cell phone.

SIGHT AND SOUND. Eaton (ETN), a Cleveland-based industrial manufacturer, won a CES "innovation award" for its HomeHeartbeat product, which allows homeowners to slap tiny sensors on stoves, floors, or heaters to monitor for water leaks, temperature changes, or lights left on.

Media on-demand is also everywhere. This year's hot products range from a bevy of cell phones and gadgets for listening to music or watching movies on the go, to devices and services that give consumers greater choice over when they see movies, TV shows, and other digital content. Startup Akimbo received an award for a $199 device that looks like a DVD player and allows consumers to pull video content directly from the Internet to their TVs, either from free or subscription services.

At this show, you can't miss the new portability of digital radio. Delphi (DPH) won an award for its $349 XM2Go MyFi handheld device that makes XM Radio's digital service even more portable than it used to be.

NAILING THE FUTURE. And TVs abound, both big and small. Some are whoppers bigger than 60 inches, though the industry average is still around 40 inches, estimates Toshiba. And these TVs are smart. LG, which won 16 CES awards this year, is introducing for the first time in the U.S. two flat-screen TVs that sport built-in digital video recorders.

So, even before the last hammering was finished, CES was already showing the way for the year in consumer electronics. With more competition among the industry's big guns and convergence in the air, it promises to be a year of ever-increasing choice for consumers. Green is Internet editor for BusinessWeek in New York

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