Gateway Making PC Part of the Appliance Family
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Gateway Inc., and Broadcom Corp. are getting together to work on a Net appliance solution that brings the PC, TV and eventually the telephone together.
The Thursday announcement adds Broadcom to a growing alliance of companies pitted against the net appliance line released this fall by the Microsoft Corp.-Compaq Computer Corp. coalition.
Microsoft and Compaq are effectively offering customers a free Net appliance, with Microsoft giving a $400 rebate and Compaq $100, for the $499 iPac Home Internet Appliance, in return for a three-year contract to MSN.
Gateway hopes to offset the competition with its Web appliance, the Gateway Internet appliance, which runs on a Linux platform using Transmeta's Crusoe processor.
Just because the announcement was made today doesn't mean Gateway and Broadcom haven't been working together on the sly.
For the past five weeks, Gateway has been shipping its Select and Performance PCs with Broadcom's 10-megabit HomePNA 2.0 networking solution. Broadcom's chipset lets the PC hook up to a home's existing telephone line and communicate with other net appliances.
Dr. Henry Nicholas III, Broadcom president and chief executive officer, said the strategic agreement he signed with Gateway is the first major step to include the PC in the net appliance loop, not separate it from the rest of the house.
"Our partnership with Gateway is a major step forward in transforming the PC from a 'computing island' to a connected multimedia appliance," Nicholas said. "This isn't about simply sharing data or Web access. It's about sharing music, video and telephone calls, with all existing household phones, TVs and stereos. The inclusion of Broadcom multimedia home networking as standard equipment on million of Gateway PCs will transform phone wiring in millions of homes into a rich information and entertainment network."
The deal with Broadcom is an important step in Gateway's move to include the PC into its coming product line of net appliances, which also includes a Web tablet and countertop appliance.
The convergence of the three was first introduced last year, when America Online announced its $800 million investment in the popular PC vendor. AOL also announced it would be running the appliances on a Linux platform using the Crusoe processing chip.
Since then, the alliance has been beset with troubles ranging from security issues to bad press.
In August the pre-Alpha software code for AOL's set-top AOL-TV, an appliance that will connect to the Gateway PC through the HomePNA 2.0, was leaked from the high-security facility where it was being developed.
The open-source nature of Linux made the released code easy to decipher, giving script-kiddies and crackers alike plenty of ammunition to "break" into AOL-TV through a back door.
Gateway officials were not available to answer questions of a possible security issue with AOL's appliance.
Despite its popularity in the stock market, Transmeta's processor has been getting bad performance reviews. Benchmark tests fared poorly with Intel's Pentium III chip, which some say is what prompted IBM and Compaq to drop out of separate chip-licensing deals. Compaq, a Transmeta investor, is holding off on Crusoe's addition to its notepad product line.