Instrumental to chip success

...an audio system. You carry this home, set it on the coffee table, put a DVD inside of it and you now have on your living room wall home [cinema] without retrofitting. It's almost a "Back to the Future". If you're old enough, you can remember when someone would put a Kodak Carousel on the table.

A couple of our customers have built handheld projectors that literally will fit the palm of your hand, weigh less than two pounds [0.9kg] and run off a battery. You can start maybe docking a phone to that if you capture pictures on the phone and show them in a 20- to 30-inch display on the wall.

One issue that comes up with DLP TVs is size. Is there any thought of making smaller DLP TVs?
I think you are going to see two things. We're going to make sure we win 40 inches and greater. DLP cleans up when you go above 40 inches because we are basically a semiconductor technology. We can make our chips smaller over time and therefore cheaper. As the display gets bigger, we get more cost-effective, let alone better looking and more reliable.

If you are a plasma guy, the larger the display is, the more expensive it is. It's the same with LCD, so we have an inherent advantage. But it is not lost on us that if there are 8 (million) to 10m units of 40-inch or greater TVs, you could drop down to a 36-inch diagonal world and step up unit volumes — maybe to 25m units. So it's a very elastic part of the curve.

But that could still be a tough sell in foreign markets. Some of these TVs are bigger than a lot of apartments in China. Doesn't that make it tough to sell those things overseas?
China is the second largest large screen TV market in the world... but don't underestimate the impact of the Beijing Olympics in 2008. I think you're going to find when that country is the focus of the world, they're going to want to make sure that their infrastructure and everything is viewed as being at a world-class level... It's one of the reasons why we believe HDTV is one of the great opportunities. It's a 10-year plus play that we think we're in the very early days of.

Are you satisfied with the government's leadership on the broadband policy in the United States?
It's easy to point to the government and say a lot of things. The primary focus for us in Washington is for more R&D investment in basic physical sciences in the universities. I do believe a great competitive broadband infrastructure and a great competitive wireless infrastructure are important for countries. Just like we built road networks and highway systems 40 to 50 years ago, I think this is a call to action.

Intel has been trying to get into mobile phones and consumer electronics for the past couple years. You've talked about how the PC era is basically over. How do you see this battle playing out?
We're in a communications and entertainment era. That's far from...

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