PC Makers Try Again

Get ready for the personal computer's second act -- the part where the PC abandons its staid office life and hooks up with the living room's TV thanks to the transformative powers of Intel's(INTC) new Viiv platform.

Like a good made-for-TV drama, this tale has a back story. For Intel, it goes back to 1996, when the chipmaker took its first stab at marrying the computer and the television with a service called Intercast.

Consumers with Intercast-enabled PCs could watch television on their computer monitors while simultaneously receiving a stream of related data (say a baseball player's stats) broadcast over the portion of the airwaves that transmits closed caption information.

Intel enlisted a slew of broadcasters to offer enhanced Intercast programming, including NBC, MTV, CNN and PBS. But the service never caught on with consumers and quietly faded away.

Intel isn't the only hardware company with skeletons in the closet of the digital living room. In the late 1990s, Gateway(GTW) and Compaq (now part of Hewlett-Packard(HPQ)) each peddled clumsy hybrids of giant picture-tube televisions and desktop computers dubbed PCTVs with price tags that kept them out of reach of most consumers.

As the memory of these past missteps grows more distant, the PC industry is once again eyeing the living room. This time, many tech companies argue, the stage is set for a more favorable outcome.

"The world is a pretty different place now," says Michael Gartenberg, the director of research at JupiterResearch.

With broadband Internet connections, wireless home networking and digital content all readily available today, the time is right for the PC to evolve from an office-bound productivity tool to a legitimate home entertainment appliance.

"We saw a lot of the early seeds planted in the past couple of years," Gartenberg says. "In 2006, this is where this is going to go from the early enthusiast to the mainstream."

And with sales of desktop PCs slowing, the advent of the digital living room could be just the thing to reinvigorate the industry. Intel, the world's No. 1 maker of processors for PCs, is taking a lead role in the effort.