Test-Driving the Technological Superhighway

Whenever I drive a little too fast, my wife says to me, "Who do you think you are, Mario Andretti?" Pretty soon, I will say, "Why, yes in fact, I am."

There are two huge markets out there for technology. One is the virtual world that sits behind your computer monitor, and the other -- which is just as large, but often forgotten -- is the real world, warts and all. I have to admit that, after sitting in front of a 19-inch diagonal computer screen all day tracking companies via painted pixels, my brain cries out for more than a little real-world exhilaration. Browsers, servers and e-commerce are great, but what about where the rubber meets the road?

Now, investors complain, and rightfully so, that the real world doesn't scale as efficiently as the virtual world. It is much easier to add a server to handle 100,000 more E*Trade (EGRP) online customers than it is to deal with real-world customers standing in line in your store -- with all of their problems. This was true when the real world was filled with analog products, which were neither adaptable nor customizable. But now, as microprocessors have taken over the functionality of so many products, the computer code running those processors can be changed almost on the fly to help the real world scale up nearly as well as the virtual world.

The best example of this kind of adaptable code is from Polycom (PLCM), the speakerphone guys. Our fund owns a bunch of its stock, mainly for the upside potential of its new video-conferencing and data-conferencing products. But its $499 teleconferencing product dominates meeting rooms today. Why? Inside this three-corner device is a processor with 20,000 lines of code. As soon as someone speaks, it figures out what the room looks like and even where people are sitting. It does this by measuring how long it takes sound to reach each of the three microphones and then triangulating the distance. It adapts itself to objects placed on the table or even people moving around the room to maximize the voice quality at the other end. This adaptable code is why it owns more than 70% of the market, proving that quality can win over lower-priced competitors.

This technology, incidentally, is a layup for car phones. It could figure out the layout of the car and adapt for the volume of the speaker's voice, road noise and maybe even for the clown behind you honking at you to go faster.

Another cool example, still based on audio, is home-theater systems, such as Dolby Pro Logic and the new Dolby Digital AC-3 that comes with the new DVD players. Instead of just two stereo speakers, home theaters are created with the addition of a center speaker, two rear speakers and a subwoofer system. Once you have all those speakers, your amplifier can start playing games with both sound delay and phasing to simulate concert halls, jazz clubs or stadiums in your living room.

The $2000 Yamaha A-1 has a separate button that claims to turn your room into the Bottom Line nightclub in New York. But does it? Frankly, it really would need three microphones and computer code similar to the Polycom system, enabling it to adapt to the room, furniture, people -- even the Elvis-on-velvet paintings on the walls -- before it can truly simulate nightclubs. If not, the system is just making a guess. Once that is done, perhaps I can download my own choice of clubs, say the Cow Palace south of San Francisco or even the Mormon Tabernacle in Salt Lake City. Creative Technologies (CRTV) has the PC version of this, playing MP3 files on your PC; it can emulate listening environments all the way from Giants Stadium in New Jersey to your shower at home.

Start Your Engines

Let's go from sound to speed and from virtual drivers to real ones. Almost every car produced today is jam-packed with preprogrammed controllers for electronic ignition, spark-plug timing, transmission shifting, etc. Some transmissions offer a switch between N for Normal and S for Sport, the latter basically shifting a little slower, so you stay in the lower gear longer, losing gas mileage but perhaps gaining acceleration. As we all know, however, the true exhilaration of driving is controlling the gear-shifting yourself, with a clutch-based manual transmission. Unfortunately, this requires a third pedal and a gear shifter, which take room away from your CD collection (among other things).

Formula One racers had an even bigger problem with the clutch: It was hard to shift while turning and required taking one hand off the wheel at high speed -- not a smart thing to do. In the early 1980s, the company Magneti Marelli of Fiat (FIA) invented a computer-controlled clutch. It measures engine revs, car speed, temperature, torque and the like, and then -- via a small motor -- opens the clutch, backs off the revs, engages the gear and closes the clutch while increasing revs again. All of this is based on the angle of the accelerator pedal and the speed of pressing down on the accelerator -- the actions that a real driver would perform. Remember, this is not an automatic transmission that is heavy and eats up lots of power. It is a real disc-based clutch, but features a paddle on the steering column that the driver flicks up or down to shift gears.

To tune it properly, they sent Canadian F-1 driver Gilles Villeneuve out on a track with his Ferrari 312T2, captured exactly how he would shift gears in various situations and wrote that into the code. English racer Nigel Mansell helped tweak the code to his driving style as well. He equipped his Ferrari 639 with the help of a "Virtual Velleneuve" and won the Brazil Grand Prix in 1989, the first time the Marelli system was used.

Now, this same system is available in the $150,000 Ferrari 355 F-1, a street legal machine with the same Marelli "F-1-type power-train-management system" that not only shifts gears faster and more precisely than you can, but adjusts the suspension settings as well. The one I test-drove (Hey, tech is not always dull!) was quite amazing. Of course, all the high-end stuff has a wow factor, but if done properly with microprocessors, we know the cost-reduction curve can be quite steep. Already, Alfa Romeo, a unit of Fiat, has announced it plans to deploy the Marelli system in midrange autos, so you don't need to drop six figures to have these F-1 drivers shift for you.

Of course, Marelli controls the programming, but it won't be too long before it sells add-on packs off its Web site -- maybe with Mario Andretti's Indy 500 driving technique coded in. And then I truly will have an excuse to give my wife for speeding.

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