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Intel installs RealPlayer in New Web Appliance

It's been a big week for RealNetworks. After making a splash by announcing the launch of MusicNet, a much-hyped music subscription service with three of the Big 5 labels, RealNetworks now hopes to tap the Web appliance market.

RealNetworks is hoping to position itself at the forefront of the post-PC era, by integrating its RealPlayer as the only media player found on Intel's new Web appliance, known as the DotStation.

Both RealNetworks and Microsoft have been making their move into the home entertainment space recently. In March 2001, RealNetworks and Hewlett-Packard announced that they would collaborate on a new line of digital entertainment products targeted to the home. Microsoft, meanwhile, has made deals with Intertainer and uniView to create a DSL set-top box that delivers streaming video to TV sets.

But so far the appliance market has been slow to materialize. The first movers have, for the most part, fallen by the wayside. Netpliance was a media darling when it began selling its I-Opener Web surfing appliance. However it stopped selling the product in November 2000 and laid off a large portion of its staff. The I-Opener was later sold at a loss for $99, while the company hoped to regain its profit through selling the connection services. The product became a bit of an underground sensation when hackers figured out how to hack the machine into a Linux box, and never sign up for the service.

Other tales of woe have hit the appliance market in recent months, with 3Com announcing that it will discontinue its Web appliance, Audrey, as well as the now mythical Internet radio device, Kerbango.

In addition, Gateway recently announced plans to rethink its Web appliance plans. And just this week Sony announced that it would delay the launch of its eVilla Internet appliance that was scheduled to come out this month.

Despite the gloom, Intel is moving forward with its DotStation and has announced a customer. Intel will be shipping 250,000 DotSations to Banco Santander Central Hispano, a major bank in Spain. In partnership with AOL, customers of the bank will be offered the product, and each of those will be enabled with the RealPlayer.

Sherman Griffin, product manager for Consumer Appliances, RealNetworks, commented on the company's decision to move into this market: "RealNetworks strategy is that if there are going to be Internet access devices out there, and consumers are going to use it and use e-mail and want entertainment, they need to be able to access that great content out there that is played back in the Real Player. As these devices scale up our strategy is to be there and work with these partners and enable distribution."

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