The public side of CES may all about showing off consumer gadgetry, but there's another, more lucrative CES going on behind the scenes. If you toured the private meeting rooms of the South Hall instead of the display booths, you'd find dozens of small manufacturers pitching themselves to the behemoths of the tech world, angling for an OEM deal or a partnership or even an acquisition. This year, the hottest commodity is a new take on UI. Depth cameras, gaze trackers, motion sensors: the weirder, the better. Forced to compete with a flood of touchscreens, PC makers are increasingly desperate for an edge on interaction design — and for the right price, small firms are happy to deliver it.
With enough money and enough clout...
Tobii is a prime example. It's a gaze-tracking device, using sensors to build a 3D model of your eye and track exactly which part of the screen you're looking at. It could serve as base hardware for all sorts of cool UI tricks, like a map that zooms to whichever spot you're looking at, or a TV that auto-mutes when you look away. With enough money and enough clout, it's easy to imagine a day when every laptop has one. For a PC market that's increasingly starved for innovation, that's too attractive to pass up.
As a result, Tobii showed up in no fewer than five places at this year's CES, with a demo at Unveiled, a prime spot during Intel's event, and placement at three different booths on the showroom floor. They've already locked down a place in a new line of Haier Smart TVs, powering hands-free volume control. Intel acquired nearly half the company through its VC arm, and is currently building out Tobii's SDK in its perceptual computing lab. And they managed all of it without any standalone hardware and little-to-no in-house apps. On its own, all Tobii can do is move around a dot on a screen.
Similar deals have overwhelmed newswires in recent months. Just last week, the motion-tracking firm Leap Motion announced an OEM bundling deal with ASUS, spurring production as high as a million units before they'd sold their first box. In the same booth that showed off its Tobii tech, the Chinese TV maker Haier also offered up a TV with a body-tracking depth camera and another with a Neurosky Mindwave headset for monitoring neural signals. In both cases, the hardware came from smaller firms.
On some level, it plays into the industry’s conventional wisdom about small firms innovating and large firms scaling, but it works particularly well for new kinds of interaction design. These are unusually versatile, low-impact technologies, and they're exactly the kind of risk PCs aren't known for taking. As Leap Motion's Michael Zagorsek put it, "You just plug your peripheral into any computer and it works. It's like a whole new computer." Licensing a new interaction project is a relatively cheap way to reinvigorate their whole product line. And if it users don't like it, companies are only as committed as their licensing contract.
After 20 million units shipped, almost no one has heard of PrimeSense
The playbook has shown success before, most notably with Microsoft's Kinect. But after 20 million units shipped, almost no one has heard of PrimeSense, the Israeli company who developed and licensed the body-tracking hardware. The company wasn't acquired, and spent this year's CES taking meetings at the Renaissance for other OEM deals. Its most prominent hit this year was a deal making Haier's gesture-controlled TV. The biggest problem? To the casual observer, it looked like they were ripping off the Kinect.
"They'd love to have exclusivity, but it has its price."
It’s a particularly frustrating end because at least some of these companies are able to establish their own ecosystem. Leap Motion may be partnering with a laptop maker, but they’re also launching their own Leap-branded app store. While they’re serving games to ASUS users, they’re also promoting their own platform. But not every startup can pull off that trick, and in the early, muddy days of a technology, it can be hard to know which side of the line you fall on. Could PrimeSense have made it on their own? We’ll never know.
Vision Objects makes another piece of software you've probably used without knowing it. They built the handwriting recognition in Samsung's S Note Android app, drawing on lexicons from over 50 different languages. The program has been active since 2011, but Vision Objects was only allowed to go public with the partnership last month. Now they're licensing to ASUS, Smart and Seiko, trying to get handwriting analysis into as many places as possible. As one spokesman put it, "they'd love to have exclusivity, but it has its price."
They'll be powerful bargaining chips if the ecosystem wars heat up — if Samsung wanted to cripple ASUS's handwriting functionality, it would be as simple as offering a Vision Objects a wildly lucrative new contract with an exclusivity clause — but for now Vision Objects is happy to be a free agent. It won't make them a household name, but they won’t run out of potential licensees any time soon.
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