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what's the next big thing what's the next big thing what's the next big thing what's the next big thing higher technology the next Wow the next OMG the next seriously I don't know I don't know I don't know Cena knows find out at the next big thing welcome to the consumer electronic show welcome to cnet's next big thing super session well it was really good yeah is it knows all right well that it's the biggest trade show in the world this is more than 120,000 people in Las Vegas for this event and for you-know-who cousin blow awesome hmm the first previews of the new technology will be available to you today the highlights over the years that have been here the VCR the camcorder the dvds the HD TVs tablets the hill the abacus yeah the abacus was originally introduced at this event over 5,000 years ago that's true and it wound him on the floor dead it wired them on the floor everyone in Vegas was like much as they are now everyone's very excited this year about the 3d TV the new xbox system and now please welcome our hosts from cnet Mollywood that's a real name Hollywood that's a greenie yeah it's like Molly Molly would but it's Molly woods three Marley Marley would I bet she's never had that before Evelina no no Molly wait and then Brian Cooley to him Bollywood and Brian Cooley everybody everyone got our cnet stage later for the unedited version you want to see the objects that's the next big thing welcome to Xena presents the next big thing it's our annual CES super session where the cnet team lays out the hottest trend and consumer electronics technology these are about technologies and trends and layers of both of them that are going to define consumer electronics and media and advertising for many years ahead and in this case this year the next big thing is the ecosystem and I am fairly certain that if you've been here longer than a few hours you've heard that term at least 100,000 times which means we feel pretty good about this decision we're talking about that essential essential connection between the actual consumer electronics the hardware that you see all over this show floor the content on it whether it's books or video or television or games the apps the operating system and the connectivity and the ecosystem is this dream that in some ways all combines to get us closer to the vision of the always on always connected do-it-all device right how long have you been heading toward that one those devices alone just don't cut it anymore that's the big story here the Consumer Electronics Show is very much about electronics but now we can get those devices to sort of leave the ground a little bit to transcend where they come from as tangible devices and today we're going to try and figure out this ecosystem era by talking to some key players one-on-one with some of the biggest names in technology really none of which will need introduction for you and what this trend and what this era going forward very deeply means for consumers established companies and also upstarts that are on the make please join the conversation by tweeting your thoughts about this panel let everybody know that you're here as we dive a little bit deeper and explore at least how we see this concept of the ecosystem we're gigabytes of RAM terabyte hard drug 4.3 inch to HD touchscreen 8 gigabytes of flash memory consumer electronics used to be almost solely about the electronics but that's changing fast after months of rumors Facebook's new app for the iPad now the sinking of media content is the slickest part there's the line between what's on the device and what's in the cloud and it integrates with your gmail and your android now specs are basically the price of admission and winners are built on the shoulders of what you can't touch their ecosystem that refers to the combination of device services apps content and operating system when consumers buy a device today they're really buying into a way of using it smartphones and tablets that are gateways to media games social networks video chat and more TV sets set-top boxes and blu-ray players that talk to the cloud your mobile devices and each other it's media that is in place and in sync wherever you go whatever you're using but when consumers buy into an ecosystem they're investing in much more than just a device and a few apps to put on it hardware operating system apps content and provider form a complicated matrix consumers first need to be able to understand it then decide which one they'll use if one Apple arguably started the modern ecosystem trend with iPhone or iPad that makes you part of iTunes and App Store and now I cloud amazon built a media empire first then devices on its shoulders most recently the kindle fire microsoft has all the pieces led by xbox but so far struggles to put them all together and traditionally hardware centric makers like samsung must figure out how to create ecosystems out of collections of services and partners and surface those to consumers then of course there's Google the company that has created an ecosystem that is closest in weight to the Apple juggernaut but distributed across many makers devices and interface interpretations yet keeping Google services and software at the center of this Federation of experience but before any of us can pick a winning company we must first spot winning strategies how to do that is why we're here today ladies and gentlemen please welcome Google executive chairman Eric Schmidt thank you thank you so much for joining us today it seems only appropriate now that we've given our long vision of what we think of as the ecosystem for you to I guess tell us what ecosystem means to Google well hopefully it means scalable network platforms that really provide tremendous customer value it's funny that I would say the same thing by saying when I look at my in this case android phone I don't see one phone I see a supercomputer of at least a million computers that are out there in the cloud some we are connected by very high speed networks tremendous amount of content and algorithms which are conveniently accessible to me on my 4 inch device so when you talk about devices I think in traditional language really are missing the fact that these are simply portals for to use an old word into literally all the world's information right that hardware is nothing without software or in this case services and information and what's happened of course now is that all hardware strategies involve some kind of a software strategy and vice versa I think in the Android case we were particularly fortunate that we were able to make the Android operating system free and so harder manufacturers could sort of buy-in at essentially the right price which is zero and get something is dysfunctional and of course there's value from having everybody in the same ecosystem that seems to us to be the sea change though this idea that the standalone device is maybe even less useful than it ever was without those contents are to be powered by a well but computers that are but computing devices that are not on a network are lonely right I mean it makes no sense to have anything now that's not on some sort of Wi-Fi net one of the more shocking things is that Wi-Fi now is used to control all the lights in your house you know nobody designed Wi-Fi for that there remember there were all these specialized networks and so forth and so on but in fact there's a new generation of devices which are being premiere here at CES which just get under your Wi-Fi network they talk to the other devices and off they go right so is it just about being networked to you as a crop because you've talked obviously the smartphone is maybe the center of it all probably but we do seem to see a universe in which all devices speak to each other maybe more than they ever have and android seems to power an awful lot of those devices well that's of course our goal but our real strategy is actually somewhat different from that we want to sort of move from talking about devices which everybody loves to talk about two rather talking about how it solves problems what you really want to be able to do is walk in your house and have as you arrive in your house with your Android device all of the things that have computers in it sort of adjust as necessary and so when you go into the family room the television knows it's you because your android device authenticates you as opposed to the other family members a text message comes to you and it goes to the television because that's your preference or not right and it all sinks together and all of the previous sort of discussions about this have assumed some uber home server some central master that would watch in what was going on in the house all the different devices but in fact that's completely wrong the right model is to think of these as peer-to-peer devices that talk to each other and they understand roughly what their function is and what people want they can be configured and mopped in way obviously it becomes seamless the trick to consumer products is to make them work right it is remarkable to me that we've spent and I've been coming here for 20 years building products that aren't very good right that the products the require enormous amount of technical knowledge to keep them running right so we've now seen in the last few years where the number of vendors Google obviously being one where the product is so simple it just works and underlying that simplicity is extraordinarily difficult and expensive engineering which is what's happening in these large platform companies that you see so as Android your vehicle for getting to that end product or you know is it your goal to we've seen Android TVs announced you're obviously tablets obviously smartphones is it your goal to have Android in refrigerators to reach you know to is that my vehicle for Google to get there well you know refrigerators do need some automation right if you think about it they need to actually deal with in their energy costs there's a lot of surveys about getting your energy bills down and so forth and indeed there are companies that are putting android and refrigerators so there now are these because you are these because they're brilliant and they've done a full evaluation of all their choices or did they simply choose r android because it was free you know you never know and one of the key things about the android form and our licenses is often these are things that we don't know until they get announced and so when we say open source we mean take it and have a good time and that's I think one of the sort of core strategies which differentiates us from the other vendors to that end actually much in a different fashion from apple or even Microsoft think let's talk about let's start with smartphones the carriers the manufacturers have a great deal of influence over android is that a positive do you think all the time you know there's always a balance between what the carrier wants what the consumer wants what the vendor wants what the advertiser wants and so forth and so on we've taken the position that you can take the Android operating system and you can do whatever you want to with it if you want to use our certification you have to essentially be conforming to the principles of the android market and our reasoning which I think ultimately you know I wish people had invented this many years ago I think the first company to really do this is that what people really care about using in your language is that there's an interoperable operative and interoperable ecosystem of applications there's more than 300,000 remember when when Apple was busy talking about they had this many this many this many well now we have more than 300,000 applications on top of the Android ecosystem so they're a scalable model really means that you could start building these things quickly and it benefits the whole to have an application that runs on every device I asked our users what they were interested in hearing from you to that point and the the single most common question especially on Google+ was whether you would ever offer a stock vanilla option for every Android phone maybe a second wrong that users could is so that fragmentation does appear to be low be hampering you want to be careful with the word fragmentation okay when I use the word fragmentation of differentiation differentiation is different from fragmentation differentiation is positive fragmentation is negative differentiate appreciation for they give the room differentiation means that you have a choice and the people who are making and let's use phones as an example we're making phones they're going to compete based on their view of innovation and they're going to try to convince you that there's is better than somebody else fragmentation means that you have some application that you care about it it only runs on one and not the other and you only I have a choice is it important important subtle there but isn't some of that happening to stomach it's not what's happening is our core strategy is to get everybody under the ice ice cream sandwich which is the new release which is on this phone and we we absolutely allow as part of our normal business are our partners to add or change the user interfaces and so forth as long as they don't brake application compatibility we see this as a plus it's an area for a differentiation they can adapt their software to the necessary hardware changes that they want and it's given you far far more choices than any other strategy we could've imagined do you think that ice cream sandwich is an opportunity for maybe a little greater control or do you feel like that's not necessary well do at least over the skinny when you say add implantation when you say control it's absolutely a an opportunity to standardize the api's and the basic level of services that android phones offer it is not a requirement that one use exactly the same user interfaces and so forth although we certainly hope everybody will use the standard user interface people are free to make the necessary changes as they see that and what's great about it is if you don't like it you don't have to buy that phone you can buy from somebody else you actually have a choice competition provides value drives across town etc Sarah let's talk about the living room a little bit that seems to be a bigger and bigger part of the ecosystem certainly relevant to this show here how do you get there and we've seen now Google TV a bigger part of LG's lineup this year also Android on TV do is their crossover is you know as Android the road how do you get in the living room well of course Google TV is doing very well we LG just announced samsung has announced that they're working on some stuff we have a whole bunch of additional partners coming we release Google TV in roughly September it's the only only offering I know of that fully integrates the television experience and the browsing experience all the ones that have been w previously have had limitations this is a full function browser a full function platform for combining internet capabilities internet viewing as well as traditional television doing we've argued quite strongly that people will watch more television because of google television because they don't need to go somewhere else they don't have to go to their other screen it's all there they can go back and forth and integrate and cross integrate them Google TV is an example of the pointers making earlier which is that the more and more of the devices that you have in the home the more they can talk to each other to configure around your needs to if your TV is running Android your phone is running Android they can talk to each other how important is content in that scenario well of course content is what drives everything we've been fortunate that we've now and I think it took quite a cook us a long time to complete the necessary pieces we needed we were able to launch a couple months ago Google music if you haven't tried it I encourage you to do it three of the four major labels more than a thousand of the independent labels all there's lots and lots of music and a partnership that you can purchase there there's also a mechanism for people who are truly independent it won't want to be labels themselves to publish their information into the ecosystem it's available all the new on all the new android devices we had previously done books and movies I think we have a full offering now so you obviously have a long list of products how important is integration we have a lot of user saying can I get a dashboard a unified dashboard for G+ for Gmail for report but also true convergence between gtalk and voice and this has been Larry you know larious CEO decided to much much more focus on on solving this problem than I did and since essentially April or May has been leading an internal effort to completely standardized standardized both the UI and the expression across this for precisely the reason the direct historically google has been a set of not fiefdom but sort of reasonably independent units of creativity it served us very well but it drew drove this slightly different feeling to everything and we made a decision to cross integrate it so from the consumer perspective how much of a concern is lock in media lock in to some extent if you buy in fact there was an apple legal representative quoted in court in Australia saying that the Galaxy Tab vs ipad lawsuit was primarily about ecosystem that it was about you know they didn't want to create android customers who would buy a bunch of media that wouldn't work on an iPad this convoluted I know that this reasoning is only the reasoning that a lawyer who was paid for by app could have come up with apple apple eyes a bunch of stuff Apple work very hard to block choice in Germany by trying to prevent Samsung tablets to becoming available right right that's called prevention of choice consumers should want choices I don't mind if you actually prefer the other guys product I'd like you to evaluate mine fairly and make an appropriate decision as a consumer it's called competition right well and you the media that you sell is primarily open formats right that can be transferred to other devices that I think is that where customers worry about lock and do they have to buy all Samsung forever well with it for everything to work well certainly with android android platform is media interoperable and so all the products that i was talking about the movies and the music and so forth work on non samsung as well as samsung devices and that's part of the promise if you're asking what does a consumer think about media log and a consumer is pretty straightforward it's pretty well understood they want to be able to purchase and i hope legally copyrighted information they want to be able to repurpose it on every device in their home in their office without any hassle and why it's so hard for all of us to understand that is beyond me and a lot of them are unwilling to do things which are illegal various forms of copying and so forth because they're prevented legally to pay for it you'll be much better much better for the industries as a whole to organize themselves to allow that to occur and to get an appropriate fee for doing so alright last question if you had to pick one element of what we were calling at least the ecosystem hardware content services or software what do you think it would be well they work together the thing that I'll answer a different question which is what was the most surprising thing in 2011 and and I and I think that is also my question but i but i but i but i think i think it will also answer that frame it differently absolutely that sorry be doing what the the power of the ecosystem that you're describing it's always a surprise to people when they discover how powerful these ecosystems are which i think is the point of your panel and your whole meeting today and it's even for me I've done this for 20 years I was surprised again at the power of the ecosystems that have been built and I say this with respect to the Amazon ecosystem to the apple ecosystem even to the Facebook ecosystem which have similar characteristics in this regard as well as obviously the google one and the reason they're so powerful and the reason your argument is so right is that it's the fact that everyone is working against this sort of cloud model platform model means everybody's a winner and because everybody is a winner you get enormous essentially growth effects you get this person helping you and get this person helping you and you get this application helping you and all of these people can operate without your knowledge and control the secret in computing and these platforms is to make them open enough and we would argue as open as possible so that you can enable enable the creative people whether it's the content people the apps developers the software developers or the consumers to use them to love them to extend them and so forth not only do you build tremendous value you tremendous you build tremendous loyalty they are economically very very valuable to all of the players right we haven't talked very much about the other component which is the ability to bring in money but to be able to pay to pay for all this infrastructure which is not cheap so it's the sum of all of that and the rate at which it has occurred that I think has been the biggest surprise great thank you very much you thank you all thank you mom good thank you so much to Eric Schmidt now that is of course the Google vision of the ecosystem now though as you walk the halls of this show obviously you see consumer electronics manufacturers everywhere people who have built their brands and made all their money on electronics so that brings us to a slightly different take on the ecosystem we've seen how ecosystems proceed when their service centric offering search video social and more on a largely Hardware agnostic faces but what if you're a leader in televisions or smartphones or both and more how do you keep wielding that advantage while offering an operating system you didn't develop apps you don't write and content you don't own and still come out on top and stay unique Hardware takes on a different role in the ecosystem era but never assume it doesn't matter Samsung is behind a lot of the best-selling smart phones and tvs with computers and even connected refrigerators rounding out the mix all available with one flavor of ecosystem or another but integrating outside platforms on your hardware while maintaining your edge through it and creating a unique proposition is another flavor of the ecosystem challenge and on the minds of many in industry with deep roots in the device all right now if you'll join me now in taking the ecosystem coin as we've seen it and if not turning it completely over turning it largely to a different side and join me in welcoming tim baxter president of sales marketing and operations for samsung electronics america have a seat okay hey Griffin I need right choice or should I say he brought crack that's we've got the note we've got over what what have to see we don't want that to get the headlines do it they couldn't get actually brought crack to CES I could not get the 75 inch TV in my pocket so he can like a where's the 55-inch oled it leaves will bring a few goodies out all right now Tim we've heard one still pulling them out just it's still you like that like a cop you got a belt full of goodies that you brought out and surprised you didn't wear your Imperial margarine crown because you are not blowing smoke you guys are emerging quick quickly as the king of CES in presence in breadth and scope and in ecosystem across the widest product category as molly was mentioning from connected white goods all the way to the LED televisions laptops tablets smart phones connected camera you announced here as well tell me right off the bat your first reaction is you're watching listening to Eric's vision of how they see the ecosystem I know the definitions vary you guys are in a very different space you make and live and die on hardware that's your game how can you be even in the same mindset as a Google I know you guys are touching in the same place in the industry but it seems like these companies would be so completely disparate in how they get there I think what ties things together in terms of the thinking is a consumer orientation right and it really starts in my mind with the the reality that you know the average consumer has about 30 consumer electronics devices in their home you don't think about all the devices you have I there but very few of them are connected to each other right so really the opportunity in and the expectation consumers have is to bring that together in seamless and relevant ways so I think that guides all of the participants in in the value chain associated with this so I see you guys come into that picture absolutely and most people in this room are probably gonna think yeah Samsung is going to do a piece of that maybe they're going to bring in the Wi-Fi the Bluetooth the beaming the link is the infrastructure tell us why you have a birthright to be in the software the media the content and this kind of gossamer that ties that together the experience as we call it you know I think you know what guides us I is a continual passion and desire to enhance the value of the product right I and you start there and coupled with what the consumers are looking for right and so you really need to have that as really the starting point on it and then trying to add value that value comes across in being able to share across devices we believe I and recognizing that everything isn't built in a common way right technologies are evolving at different paces and we're bringing in a lot of disparate categories would have historically been disparate categories a refrigerator right and a television and what is the glue that starts bringing that together is the thing that really motivates us and it's it's really again driven by those expectations from a consumer standpoint which brings up a comment you may mean we talked to a couple of weeks ago in preparing for this and you said right now companies paraphrasing walking a tightrope between universal and proprietary to build your own value and not just be bringing Google on your platform like your competitors might be you talked a lot about being nimble is that another way of saying we don't have all the answers either right now oh I don't think anybody really has all the answers right i mean the pace of change in our industry is pretty remarkable even though we have been talking about these same things for decades and i've been coming to the show for several decades I and but it's really happening now but it's happening in so many different ways and the level and the amount of innovation I creates new possibilities and new challenges so you have to be nimble in being able to seize those opportunities and that's what we focus on so i wanna i want to get back to this idea of you building in you samsung building in the technology largely from android we know that so well in your products smartphones and tablets of course then there's samsung apps you see something missing an android or you wouldn't have launched that platform what is missing well i don't think there's it's a case of its missing as as Eric said we have a great partnership with many people in this quote-unquote ecosystem that we're talking about here we have a great partnership with Google in phones we are partnering with them and developing things in the Google TV space and it's well recognizing that this is continuing to evolve we partner with them and one of the launch partners with chrome OS and the chrome pc so we see that as a as a big part of this but remember you know we've been in the smart TV category since 2008 so we are really been in it quite a while we have a leading position in it we have about 1400 apps available now that's not 300,000 but that's this is a television right so you need to make the apps relevant to the entertainment experience and that's what we focus on and so we have continued to develop our strategy and smart televisions and will continue to do that but we're looking for new ways and always looking for new and out of ways have to further develop that I think you just crossed a 20 million download milestone on samsung apps so let me put it this way what are consumers finding that is missing somewhere else by going to that app space well I don't know if it's if it's a case of missing I think the consumers are bettering or different I think consumers are just continuing to learn and the phrase that the term that best describes it is discover right they want to discover things and they're discovering ways to use the television in a in a multi tasking society right we are bombarded I mean just look at you know the CNN or ESPN window and you have lots of different content is four or five different stories go on consumers have adapted to that you know our kids have adapted to that faster than we have and we are embracing that discovering letting consumers discover new ways to add value to that experience but we think it has to be related to the entertainment experience it's not a Productivity experienced person it's not a pure web surfing I want something that relates to the experience then I have or I want to discover new ways to be entertained across device categories is that the mission for samsung apps and discovery in general or is that just a television statement I think if you think about our strategy in our sort of view of the ecosystem I'm and I sort of describe it this way is a you know if you imagine a house right I in one of the rooms you know we have a content room right and that content is all the content that consumers are comfortable dealing with whether it's Google or Netflix or Amazon or our own media hub that offers a library of 5,000 movies and shows but that is one room there's also another room that we're focusing on and we call it our signature services which are unique services that we're developing as specific to the to our cross category strategy and underpinning all of that is this glue or this tissue and we focus there on how do we make it seamless for consumers to move from content from device to device or get content from the cloud whether it's a cloud service that Netflix managers or some service that we might offer and so our job really is the little where statement of entering here it is I mean and we are you know we are not a cloud infrastructure company right we are an entertainment coming we are a company that's focused on adding value in hardware and recognizing the industry and the market and the consumer expectations have dramatically shifted you know from these discrete devices to connected devices and all of that innovation is happening in a lot of great places our job is to try to bring it together for consumers in a seamless way and take out some of the angst and frustration in that process and thereby let them discover new experiences some of the angst and frustration I think comes from going to your specialty and hardware device shop if you look at apple and their roadmap for products they're at a watershed high for a number of phones they have three right now actively in the market I would imagine so a Grigori Android manufacturers in general released three a week right through the year where do you detect a risk of device chop or the consumer has a hard time saying I don't know which samsung device I want maybe I can be distracted by that confusion isn't there a risk to that I think it's a case of choice and I think consumers want more than a couple choices right I'm and you look at it in the car industry you look at it in in the electronics industry you look at it in the clothing is people want choices and we're about giving them choices right so i have here my new galaxy s2 which is an android based product that has ice cream sandwich and i love it and i've activated it right and that works and i really enjoy it right samsung announced yesterday this galaxy note right which is actually i'm really a really unique concept 5.3 inch you can do this very android smartphone and it's got ability to stretch a category but then again always having to be careful as you talk about the tightrope of not creating is there is too much choice right i don't know if it's too much choice i think it is really this is what there could be but there's yeah there's many choices that exist out there it's our job to be able to articulate the applications and and be able to communicate to the consumer relative to their needs i want a device maybe that as a phone and truly is a tablet and let's create something new so we just created and seen the growth in the tablet industry right which morphed as a between a tablet or a smartphone and a pc now we've introduced something that's actually in between a tablet and the smartphone and it's about choice and how many different devices do any want to use and when do I want to use those devices and that's where a product like this fits it choice and hardware happens far less frequently than choice in content of course I may choose a phone every two years a laptop every three a tablet every three or four but I'm choosing content may be several times a day on a weekend where do you get into unlocking the Hollywood treasure chest can you be a role player in that many people are looking at Apple to say they can crack the code to get instead of the few titles the many instead of the Byzantine pricing plans the simple can you and do you want to play a role in cracking that code do you want to beat him at that game I think our focus really is to work with the content providers and facilitate the the delivery of the content to consumers want on the devices they want so that's really our mission we're not a Content company we don't aspire to be a Content company but as you mentioned kind of middle way or a gossamer layer in there can you be the one that brokers the relationship perhaps from Hollywood to Android by having some kind of a leadership role I mean your presence is been far greater than it was three years ago in this business and I think we can and I think we can do that I'm really under the premise that the i believe the content and community wants choices and their providers in or distributing their content so we provide that I think opportunity for them the Google 20 samsung TV gets coming up win again I tried all right I tried twice you tried let's talk about the the role of you mentioned earlier the idea of sync and seamless relationship between devices right now that's something of a simple model the idea that I could pause the movie on my tablet then when I go in the house devices know that I want to pick up the movie on the TV clever right now not even that well done if doable but feasible yeah what's more sophisticated is to say I'm going to pause an experience on one device and when I move to a different user place the network of devices and services i have we'll figure out something different that I want to do on that device because I'm not just going to say okay I'm navigating in the car I want to carry that to the house watching a movie on the tablet well maybe when I move to a different room i'm not in that mode anymore is there a place within samsung apps that you want to be that layer of the next most sophisticated sort of sink or what i think of as intimacy transparency and intuition yeah i think if you you know the evolution of what is occurring here is such that we've gone through a process of simply making content available in a stream fashion further consumer right and that was one shift that took place I'm we announced here several applications and the list 24 hours around I'm being able to move the content from device to device or buy it once and use it in multiple places and we think that's the next evolution yesterday we announced an application with technicolor MGO that allows me access to to content on the television but i also get relevant bonus content i deleted scenes and games that may relate to that experience available simultaneously on my other devices so you starting to see that that transition and yes i think the expectation is and we've worked with mso's on this I'm and continue to do that I can stop and pause and take it up on from the TV into the car on my mobile device so that is it's an area we're putting a great deal of energy and we're working with content companies and and distribution companies to bring that experience alive again it's one we think that is natural in terms of the expectation for of consumers you recently took on additional duties that Samsung Electronics America you've added Enterprise to what was previously broad consumer role yes congratulations thank you for sure you're very busy the enterprise role is not one that is irrelevant to this crowd anymore if we look at your ability to take market share it's now a BYOD world in the enterprise to some degree more and more IT folks I speak to here at the show yes bring your own device within parameters those parameters seem to be loosening within enterprises is that perhaps the most ripe area you can take share in the mobile space as opposed to going head-on after let's say on Apple share argument maybe it's a rim share that you want to see is low-hanging fruit for your mobile devices certainly in smartphones it's not much of a battle on tablets is that yet across an enterprise consumer cross-play that you can look at say we're going to be the first to really get in there and work with enterprise and be their next blackberry their next device that they really trust and work with but also that delights in the individual employee as an individual yeah I think the biggest shift that I've seen and now I've been managing the enterprise for you know about five days and so put that in context your life in my lengthy experience no but I'm clearly having been in this industry for you know nearly 30 years I think the biggest shift that I've seen is the technology used to begin in the enterprise space you know new technology and you think about it in the video anything interesting exact right here and now the it's a consumerism that is driving the enterprise space and and it is that where consumers are coming in who are also in the enterprise in the business world like we all are here and saying I want to use this device you know in my network how do I do that and to see CIO is trying to figure that out so I think there's a big shift that has occurred there and having that consumer orientation we think is a valuable component in understanding the opportunities that exist for us in the enterprise space because we've historically been a consumer company but we think there are huge opportunities for samsung a company that is doing you know about a hundred and fifty billion dollars a year and we see significant growth opportunities in the enterprise space and a lot of that enterprise space we believe is going to be connected devices I die and so having that understanding and learnings that we are getting right now in the consumer space we think will help as consumers look for fitness devices or other ways to use new technology and we think the enterprise area is one of those areas let's talk about some of your children and how they may squabble if we look at ultrabooks and tablets has been a lot said about how the tablet maybe has a lower ceiling in terms of market acceptance than was first thought we've gone through the iPad one hype cycle there is large market share i considered to be a major minority a large niche ever you want to term it for tablets that seems to be what's happening especially as ultrabooks are coming out and giving you kind of the tablet experience with the file system the human machine interface the more powerful operating system and profit processor base is is there an uneasy battle between tablet and ultrabook in terms of your spend on developing the tablet we look at it as as opportunities and anytime you have the fast-growing category like tablets in just the same way like pcs over the past few years I'm you know there's going to be a lot of segmentation that goes on you know and that's what we're seeing here right in its you know maybe we over defined it in terms of whether it's this device as a tablet or PC it's what do I want to get out of this device right I want to be able to get in and out of a device and tablets have provided that we are just introducing get to show off a new Samsung device and this is our new series 9 a notebook computer and if you just look how thin this is in light right and what it also offers is a boot up time of less than 10 seconds our consumers responding to the no compromises here where the tablet has some compromises as a large mobile device and it's a function though of what am I using it for right my kids are using it and I often use my tablet as an entertainment device with some easy in-and-out access on productivity I generally use my notebook as a Productivity device with at times for me occasional needs from an entertainment space so I'm I like the ability to get in and out of a pc and if i'm going to write a long email I like that capability I enjoy waking up and grabbing I'm necessarily enjoy but i have to i get the the emails and get in and out and get a few done very quickly and a tablet or a smartphone provides that so again we're giving consumers choices in a very fast growing space but we think products like this provide new opportunities and new experiences for consumers that are going to give them choices and in terms of what they're doing all right there's a story from hardware up please help me to thank tim baxter who is president sales marketing and operation samsung electronics america all right folks now we've now heard from two very influential movers on very different sides of the ecosystem argument largely on the supply side if you want to look at it that way but there are other facets to this you can even call it sides because there are so many consumers retailers wholesalers and a third sort of a blended group of entrepreneurs and capital the list of big names in the ecosystem is long but our next panel will try to help the even longer list of new players and innovators grab a seat before the music stops Blake Kerkorian is our inventor and entrepreneur he has been described as a veteran of the convergence Wars an inventor investor and Amazon board member under his belt slingbox a mobile operating system telecom and consumer electronics consulting one of the earliest handheld PCs and a history of growing technologies from embryo to acquisition bill girly is the money man he's general partner at benchmark capital and his investment resume includes clicker opentable Second Life uber voodoo and shopping calm he's engineered multiprocessor servers analyze the IPO of no less than Amazon and picks the winners for Wall Street during the tech boom years these are the guys who make it happen so whether you're a brand new company or an old established brand listen up let's figure out how to make it all work all right everyone please welcome Blake kerkorian co-founder of Sling Media and CEO of ID eight at all and Bill girly general partner at benchmark cattle already yeah whatever take this eliasson okay thank you thanks guys nice to see you thanks for joining like are we kind of dress they do everything good I mean they go here but we were gonna do the he was gonna be dr. Eve allows me mini meal come on I was gonna come out on a BabyBjorn but he hurt his back laughs I'm a little controversial I'm just saying mr. onimous time your first here still maybe I'm we can here to try that later in the show yeah good thank you back Slater so um first of all you guys have been backstage hearing from people you know well but here in the latest viewpoints of where they're coming from top line reactions right off the bat what made you stroke your chin sagely and saying it's very good or what the hell was that anything on either of those guys I like this I like this so dare comment bye bye Eric someday I'll be able get away with that um no I I gosh you know I I think the way you guys have framed the the overall sort of session is is exactly right I you know what I just couldn't help help doing was it was shaking my head the whole time that it's finally this is finally happening and for guys like I mean Eric I Eric was on the board of a company that I worked worked at back in the early 90s called general magic and general magic had a an operating system for for intelligent devices Sony and motorola had both built products of physical products based on but they also had a networking programming language that a whole vision of an electronic marketplace pre-internet was going to happen in guys like a teen teen France Telecom are going to build and we always had this saying of sort of it was the ecosystem was framed in a different way which was vehicles highways and destinations and and it was pitched as a ten-year roadmap and I was just realizing it's like I was we the vision was right it just wasn't the tenure roadmap feels like a 25-year roadmap um and it's just it's just finally there and it's just amazing to see it all you know come to fruition and would you say that we're there I mean though certainly the premise of this session is that we're there and everybody is hoping to be there in terms of connecting all the different dots do you think we're there and how well i think it's interesting you know i think from having a connected device in your home we're there right so i worked with voodoo there and like 40 million devices now installed devices and and so almost every one of you have some type of device that allow you to get to youtube and almost everyone has ethernet in the back of their television so from that perspective we're there I think there were two things people people expected to happen and I even Brian heard you mentioned this one is everyone expected Hollywood to get run over and that that would be a sign that did it happen and that didn't happen Hollywood one round one of this digital you know they didn't get their distribution models torn up ever they didn't get ala carte pricing they were able to maintain their power and they were very adept at how they did that and then the second thing is I think we all kind of hoped that some startup would emerge as the UI of the connected television that didn't happen either and the one thing I take away from the earlier sessions is just listening to Eric talk about Android you know I will go out on lemmon say that I actually think Google's Android execution may be the most aggressive strategic initiative in the history of business like not to history attack the history of business what are they protecting the search yeah I mean look search is a fabulous business and if you look at search on the pc you know there were threats to it so firefox right had that little bar and google had to pay firefox to protect that bar and if it weren't for the consent decree IE would have been much more integrated with being than it has been and so there was this opportunity to be above search in the lair and take Google away from this incredible gold mine that it has called search so when they saw new platforms coming they decided hey we're going to come up the way to make sure that there's no one standing around us and getting in the way of that search and it's protecting search beyond just the search we know the box we're talking about but to a higher level of discovery right sure sure sir I mean SD the evolution of search which might include discovery of content certainly includes maps where they've probably invested another 700 million dollars ease but but it's just amazing you know the momentum that they have so what are they doing wrong if they're they seem best position to pull it off although there is a growing there's a growing chorus despite what Eric says from users about what they term fragmentation well if the fragmentation and and I don't think that Eric would deny it that fragmentation of the platform is a challenge it most certainly is and I didn't hear him say anything different to that you know and and of course one person's open is another person's closed from the standpoint of I want everything to be open so long as it's my AP is and everything else right so there's probably a little bit of that from Eric but that's you know that's that's to be expected you know I think that that the fragmentation will continue to be the challenge as as well as the strength of the platform and you just kind of see how those things play out I mean it was always amazing to me I remember as a kid growing up in mountain view you know very close to where Apple was born and I could never understand why anybody would buy a PC just because I would say those products did not work and why wouldn't everyone by an apple well you know we saw what happened there and so from this from that standpoint look at history you you think android you know can be can be and will be hugely successful that's not going to that's not to say it won't be without it it's sort of growing pains well that leads to another question actually I'm hoping that you'll talk to us a little bit about Amazon ah does do you need all of these devices or can you do a really strong sort of content does amazon need a phone or is it okay for them to power sort of a killer experience on a couple devices well i mean first off i'm on the board and i'm not so i'm not a liberal comment on on behalf of amazon but I am a customer and I I also i think that looked I mean from Amazon's perspective I bought my last android phone on Amazon it wasn't from amazon so who really cares i think i think you know Amazon's vision of being the most consumer centric company in the world remains true and I think though you know they'll pick certain places where perhaps the experience they were trying to provide did not exist in fact here's an interesting thing I remember always tellin of our folks at sling when new people would come in and try to try to talk about the approach here because everyone goes it's at hardware is it software is it services right and and I remember even trying to raise raise money unfortunately I didn't get rejected by Bill we got rejected by a lot of guys but you know first off you can go and raising money people like are you a hardware company or you were software company and you know I would say like okay we're both I word experience company but look if I have to try to put it in buckets we're a software company who's now selling our software in a box of silicon okay and what we tell what I tell people at sling is the approach is always look you first focus on what's the experience you want to provide then off of that you then say okay well what software needs to be developed in order to deliver that experience and then off of that is is their hardware that exists today that can develop and deliver that experience if there's not you then we'll build the hardware and I think there's cases like the Kindle e-reader where they talked about the reading experience and the buying experience and then the software and they said look no one else is making these products with the battery life and visibility and so we need to go solve that problem besides that I mean they're very much Switzerland as well as like as long as other people providing fantastic experiences they'll be happy to sell but Molly I think you bring up a good point which is these these major ecosystems do overlap so you know amazon has historically sold analog media books records and and so if they want to be in that future they have to find a way to do something that Apple's doing right Facebook gets revenue from zynga they take thirty percent of that game apple takes revenue as a distributor of game so Apple and Facebook and I think that's one of the reasons why book has struggled to get there their Apple products out on time now I think Apple made one mistake and I think apple doesn't hasn't made many mistakes but I think they may one crucial mistake in that they got greedy on the rake so I think the thirty percent rate alienated amazon and Facebook and they shouldn't have done that with with Android coming they should have made Facebook and Amazon their best friends had them deeply integrated into iOS the way twitter is and that should have happened and that would have helped apple and they got greedy on the rate and now we've got a multi-faceted war with lots of big guys out there pounding around what the Samsung have to worry about or defend against heard a lot about how they're hitting a lot of cylinders I think a few things I mean first off let Samsung has has come from from you know being potentially out of business back in I remember the late 90s and to being the powerhouse they are today so they deserve a ton of a ton of kudos there I think Samsung just like any of you know any of these other consumer electronics companies besides apple back to my comment about experiences software and then hardware all those you know most of the companies here they have it ass-backwards they start with the hardware and kind of build up and and that's continuing to be I think a challenge like you know you know just to just to maybe point out one little tiny one one little tiny knit in a product but you know that that Samson created to the point that Eric was making about you don't just deliver the the product with the spec sheet and the and the checkboxes it's got to work so somehow there should be some rule where you know maybe people can vote and it's like if a product has a feature and enough people vote and say the feature doesn't work they have to remove it from the list of things but you know so like so like take the Samsung television and again I've just bought three Samsung televisions so I mean I thought it was the best TV out there that being said I'm really into into some control and multi-screen sort of things and I got all excited at first I said oh wow you know the samsung TV comes with this iphone interface or iphone app that lets you control your television set and I thought okay wow that's great you know that's that really is forward thinking and so forth and then I went to go use it and I realized that well it did do all the things except for it was missing one very very important command probably the most important command of anything from controlling your TV what do you think that command was turning it on actually you couldn't turn it on because guess what the you know the ethernet the ethernet chip was asleep when the TV was off so therefore I had to go grab my other darn remote my our remote hit the button and then I can go control it and so it's just it's understanding that those details are so critical it's not just about getting the feature and saying hey I now have it just like the other guy does but do I have it it just sounds so basic do I have it and does it work and and you know I think that Samsung understands that they need to keep improving just like all these other companies think Samsung and HTC are probably the two that have shown the most progress there but that's still a huge challenge for these guys bill Simpson Achilles heels for them as an instructive lesson for a variety of companies that have their general struggle I think I think they've benefited by almost by not being overly caught up in their own you know way of viewing things you know I contrast it with Sony who has all these visions of their own software stack and all these kind of things whereby they can't kind of get their arms around the open standards that are out there or you know in this case Android and so being their first I think that's been helpful to them I think in the long run they'll face the same challenges that a Adele faced in the PC world and you know I think it's a very similar and I think it's a great analogy for what's going on here which is based on what I see androids just getting started it's going to become very dominant in in every home and car and and all these kind of things and once that happens you know then a whole new set of challenges will arise for how you differentiate a big favor seems like you're arguing for you know inadvertently arguing for Android as a plug-and-play solution for these hardware manufacturers so it's not their core competency all right look I think out yeah absolutely no no please I'm just saying it's late I think the catch out of the back I mean you look at how things become self reinforcing the one as I walked around the show today the one thing that just really really blew me away was you know looking at the synergy between arm and Android and so you go look at you know in the marvel booth you know at what they're doing with the ARM processor they've got these little demo boxes for connected TVs the kits are like 20 bucks but the point is there's all this ecosystem that's building around that and you know Snapdragon and you know at Qualcomm so Qualcomm marvel you know all these semiconductor companies are doing these arm cores that are 99 cents and you know they're all doing it on Android because the windows 8 thing just got announced last night and it doesn't exist and that's just monstrous amounts of effort and that all leads to experimentation it leads to cost reduction and it's just a tsunami well well n and the point I mean Eric yo eric said something else that I think is absolutely dead on which is they have delivered on the openness from the standpoint of letting people actually fragment or differentiate he'd rather see the differentiation but they're allowing the fragmentation frankly fragmentation it bad it also equates to innovation and and to allow the innovation to happen I mean a perfect little little project I've been working on the past couple years was I was trying to do a bunch of home automation and control of my house and my first thing I was going to use iOS devices as a main control point and you know what when it came down to like using that iPad as a remote control or something or putting the iPad in the wall it was a horrible experience because I didn't want have to walk up to the damn thing and and swipe to unlock it it's like the damn thing should like just have the proximity sensor and turn on and I even know the guys in cupertino so I'm calling to see if they could let me kind of work around that no no no no no it you know brought me over just as a developer brought me over into that Android platform because then I can just go ahead and just tweak this UI as much as I want and and and Google is investing in developer relations the way Microsoft actually that's a very good point 25 years ago which by the way the guy who runs Android and started Android used to Andy Rubin used to work at general magic there are 20 years ago so it's kind of interesting so you go to if you go to the Android developer relations team first of all they're just so happy to see it what can we do for you you know just like Microsoft using tails wagging but when you say hey I want a device that auto starts or I want a device that's locked down they go here's 300ms they're developing hardware like that hears it and so you're you know you're right and calling them out for the fragmentation but it won't be a failure it'll be a benefit I was in an AT&T store over Christmas and just looking at the layouts there were three iphone stations and 20 Android station and within their there's one with a big screen want a little screen one with a keyboard this way one of the keyboard this way and you know people are walking around and looking at I'm trying to think about what they want and so the real reason we want to get you guys on stage is because you're both entrepreneurs and and or the money guys what do you do if you're new if you're a new player right in this new world where it feels like you maybe have to have a hardware solution to contact bunch of content deals some maps is it possible to break in or are you pretty much as an app developer what will come across your desk tomorrow that you would get real excited yeah no no it's your desktop money sorry Gail it's your desk let's look at bills desk you know it's tough you know I've worked with two incredible teams of Voodoo team and a clicker team and we had good outcomes but they weren't blow away outcomes and there's a lot of power players i mean with what Google is doing with Android you know it's going to it's going to destroy a so much market cap you know it's already happened to rim and Nokia and you know and you know telling avin you know I think garmin's you know and got a lot of you know with the and so it's with that big a force out there it's hard it's hard to find a high ground and then Hollywood you know is played this game extremely well so you know who Luke took two hundred million dollars and a ton of proprietary content to get off the ground and Netflix is now looks like they're going to have to spend a billion dollars in content so I think you're going to have to you know I'll give you an example of someone who has done it and I've been blown away as the GoPro guys you know so it was off the beaten path they weren't trying to take over the old world or one that was highly choreographed they went to a new market and really blew it away really nailed it built a product is differentiated around that use case but it was a new use case and they got out in front of a huge wave and they've done an amazing job they started at they started at the experience they started the experience in the lifestyle and work their way down and you know you can bet the label they probably don't have much in the way of DSP engineers doing image sensing technology in that that's not what it's about um you know and so I I think that there's I continue to believe that that there is a huge opportunity for entrance in all pay places in the ecosystem I happen to love gadgets and and and love the hardware element and and I think that on one hand it's it's certainly a tough business and you have to have your act together all the way through it's not just about boobs you kind of messed up on a dram chip and you know now you can just hit the reset button and start over it's you just bought you know hundred thousand one hundred thousand units of inventory you're screwed so so you got I really have your act together and there's huge barriers but there's still such an opportunity for companies who understand all those pieces but actually and understand how to approach it again from the experience on down because I think it's going to take a long time for these traditional hardware companies to really really reinvent how they how they how they approach things you know besides that you know the start is hard and it is getting harder and harder and harder is no question you know the other the other thing from from from startup companies it's about mean obviously being disruptive right if you can find out where you can disrupt in a particular area maybe there's an established player who's got a you know huge market share and there you see something some evolution that's going to happen and it's just hard for them to move you know that's I think they're still going to be opportunities but they are becoming tougher and tougher yeah all right great guys ladies and gentleman please thank join us in thanking our two panelists here at the next big thing Blake kerkorian and really