A new chip from ATI has been designed so that high-definition television (HDTV) will be an affordable new feature for cable operators to offer in their set-top boxes. The only problem that remains is how soon anyone will get to see the more detailed pictures and stately sound being promised.
Services now marketed as "digital TV" by cable companies only offer more channels for traditional, analog TVs. True digital TV, on the other hand, promises the ability to display content with greater picture resolution than is possible now.
The ability to decipher HDTV--the highest quality version of a digital TV signal--in a cable set-top for display on a digital TV "has been too costly to deploy in the past," said Dan Eiref, ATI's director of set-top marketing. Prices have been coming down, but even a box whose sole purpose is decoding HDTV signals has just started to reach the $599 price point, and is only available separate from the cable set-top. In addition to the receiver, consumers still need to pony up around $3,000 and up for a digital TV, so integrating a standalone receiver into the cable set-top would likely help accelerate the adoption of the technology.
Eiref said that ATI has designed a chip called the Rage HDTV that integrates an advanced graphics chip needed for new interactive features such as online gaming, silicon for separating multiplexed signals, and an MPEG decoder. In so doing, Eiref said ATI has been able to produce a complete reference design for set-tops that can be sold for $299 at retail, and economies of scale should soon enable digital set-tops with HDTV capabilities to be available for $199. The chip itself should sell for around $30 in quantity.
Because of its role as one of the leading PC industry graphics chip suppliers, ATI's plans for the cable market could have a significant bearing on how fast digital television will reach consumers.
The rollout of digital TV in the United States has been slowed by a number of technical and political issues, the least of which is that there are few places where a customer can get an HDTV signal from their cable operator. The cost of a set-top capable of deciphering any one of 18 different HDTV formats has been a major stumbling block.
The problem is that between 60 and 67 percent of U.S. citizens get TV signals from the cable companies instead of an antenna, so if cable operators don't offer HDTV, ultimately, few people will ever receive it.
Lowering the cost of set-tops alone probably won't be the only reason companies like General Instrument (which already uses ATI's graphics chips), Scientific-Atlanta, and eventually Sony, Panasonic, Toshiba, Pace Micro, Philips and others will have cause to be interested in ATI's products.
Cable operators are all looking to use set-tops that enable them to offer interactive services such as e-commerce, email, online gaming and Web browsing. All of these activities require increasingly sophisticated graphics engines to power them, and that's why ATI, which is best known for graphics chips used in PCs, is eyeing the set-top market.
ATI cited figures form Dataquest, which is forecasting that the annual sales of cable, satellite and terrestrial set-tops will grow from 13 million units in 1998 to 47 million units in 2003.
"The edges around the PC and set-top [markets] are blurring," said Eiref. The cable set-top, once a closed, proprietary box, is becoming more like a PC so that things like home networking systems can be easily added in by the manufacturer. With this transformation, the market is now open to new competition for almost every component in the device.
So far, the set-top market is still wide open. Existing suppliers such as STMicroelectronics and Teralogic are going to put up resistance to ATI's entry, and ATI's well-known competitors in the PC arena such as S3 have hopes to get into new and growing markets as well.
ATI executives think there is plenty of room for a newcomer, with the market expected to grow fivefold in the next few years to around 50 million units. With the similarities in the markets, ATI executives say they hope that their experience in volume manufacturing and silicon integration will make the move into set-tops a natural one.
Information on the chip's availability was not immediately available.