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Movers & Shakers By Joan Oleck September 1, 1999


Does Scott Jones Hold the Key to Convergence?
Escient's CEO is trying to unite Net, TV, and CD/DVD technologies with his home-entertainment management systems

"We make technology behave" is the slogan of Escient Inc., the Indianapolis home electronics startup that Scott Jones heads. Escient claims to make it easy for the technically challenged among us to access CD tracks and DVD movies from our personal collections and even from the Internet -- all with the help of a TV-screen menu and remote control. And Escient's goal is an admirable one, considering how the mere mention of home entertainment technology makes most people break out in hives.

Jones seems supremely qualified for the task of delivering this home electronics breakthrough. Consider his history with digital convergence: In the late '80s, he wedded computing and telephone technologies to vastly improve the usefulness of voice mail. "I've always been interested in practically any high technology," declares the still-boyish, six-foot-five, 38-year-old, who holds eight telecom patents. "When I did voice mail, I was really converging personal computers with the telecom network. "This" -- the convergence of home entertainment and the Internet -- "is a similar problem."

Well, maybe. Experts question whether the average consumer even wants Internet downloads and multibutton remotes -- especially at prices of $3,000 and up. And, they ask, can Escient effectively pursue its long-term vision of Net downloads to your family room of any entertainment item any time? Can the company raise its CD and DVD management software above the crush of electronic items jockeying for consumer acceptance?

 

Jones's credibility rests on the eight telecom patents he holds and the voice-mail system he created in the '80s
 

Jones insists it can. "Consumers have become incredibly disenchanted with the complexity of their entertainment systems," he says. "Witness the ubiquity of blinking digital clocks on VCRs." Jones says he himself recoils from "hundreds of tiny little buttons" on remote controls. That's why he has his personnel observe consumers interacting with Escient products -- then iron out the user-unfriendly kinks before shipping. As for the electronics competition, Jones happily points to the multimedia 200-disk CD/DVD changer his company debuted last month. Microsoft Chairman Bill Gates, Jones says, held up a prototype of the changer in 1997 at a computer trade show and proclaimed it "the future." Escient's CEO thinks consumers will follow suit. "We have found that it is the nontechnical people who really like our products," he maintains.

First out of Escient's product box, in 1996, was TuneBase, at a cost of $4,000 to $7,500 depending on the model. Included were a wireless keyboard, controller, and software, all designed to allow visual cataloging, selection, and remote control of consumers' CD collections via a TV display. TuneBase 100, the newest member of this product line, came out this year with a price tag of $3,000. Tunebase 100 adds an Internet component by allowing customers to tap into Escient's CD Database, at www.cddb.com, and download thousands of music tracks. Also possible here: the purchase of CDs, via links to Amazon.com or CDNow, which pay Escient for referrals.

How much does Escient collect? Jones won't talk about revenues, but he does tell how he raised $14.8 million in a private equity placement this past April. Mostly, his credibility rests on the eight telecom patents he holds and on the early success he had as founder, in 1986, of Boston Technology Co. -- which made him a multimillionaire while still in his twenties.

 "ENTERTAINMENT FURNACE." It's this kind of energy for reinventing himself that helped Jones carve out his high-tech niche in the first place. He put Boston Technology on a roll, for example, by convincing a Bell Atlantic meeting "full of suits" in 1988 that his pipsqueak startup could build a voice-mail system "20 times bigger than anything ever built and easier to use." The following year the company saw its revenues soar from $2.3 million to $25 million. Ultimately he sold it to Comverse Technologies.

And Jones today still enjoys the fruits of that labor -- rewards such as his 50-room, 125,000-square-foot English manor house in Carmel, Ind., in the suburbs of Indianapolis. Right now he's wiring it so it can handle a specially designed "entertainment furnace" -- a computer network that controls giant touch screens and play systems in nearly every room and will eventually access Internet downloads of music and movies.

Thus far, Jones's "e-furnace" is available in his domicile only. But its whiz-kid creator envisions that homes of the future will be similarly outfitted and that each room will hold a "home theater in a box" containing surround-sound processing, an AM/FM tuner, DVD capability, and an Internet radio. There are other expensive toys in Jones's collection: He owns, for example, a Ferrari and a fire engine. Even his pets run to the exotic. He had three tiger cubs until "I caught one stalking my 3-year-old."

 SCRAPPING A JET DEAL. After he sold his company, Jones simply concentrated on having fun. He flew jets and set about building the nation's first civilian jet team. Then came one of those life-overhauling events: While visiting the Central Asian republic of Kyrgyzstan to buy military aircraft, Jones watched a close friend crash to his death. He himself narrowly escaped deadly flying debris. "It was a big wake-up call. I learned about mortality before it was too late," says Jones.

He scrapped the jets deal and went home -- really home, this time, to Indianapolis, where he had grown up. He wanted to "make a difference" by helping his heartland hometown develop a "high-tech corridor" between Purdue and Indiana universities. Recently, he has put wheels on that notion by chairing the Gazelle Fund, a $50 million venture-capital fund aimed at bringing in new tech companies.

 

Forrester's Hardie has doubts: "Consumers, when they sit down and watch TV, want to watch TV"
 

Escient emerged out of his home theater project. The man he hired to help him, Thomas Doherty, sold a custom system that let consumers manage their CD collections via a TV screen. Jones saw that he could use artificial-intelligence software to help the system identify the contents of disks -- plus link the system to the Internet. Thus was born Escient, which became a 120-employee company. Its long-term vision? "We are moving away from personal computers in the home," Jones says. "Computers will be integrated into things -- into TVs, into toasters -- and where there already are computers, their role will be enhanced."

What does all this mean for the music connoisseur? "No longer do CDs collect dust, only to be played once in a blue moon," Jones says, radiating the zeal of a kid with a new toy. "Want to hear Dave Matthews' Crash instantly? It couldn't be more simple [with Tunebase]. A few button clicks on the remote, and you're quickly sifting through the covers and songs to play your favorite tunes. Once people have used it, they can't stand to be without it."

Or maybe not. Mark Hardie, a senior analyst with Forrester Research in Boston, says he finds it odd that Escient would use the TV set to manage music. His company's research suggests that "consumers, when they sit down and watch TV, want to watch TV."

 

Next from Escient: Enhanced CD, which will let users download additional tracks to CDs they already own
 

The analyst might be even more skeptical if he heard what's next from Escient: musical enhancement products connected to MP3, the new technology that compresses files for digital downloads of music from the Internet. Enhanced CD, a technology patent Escient got in an acquisition a year ago, will allow consumers to download off the Internet additional tracks to commercial music CDs they already own. This means that a consumer will be able to take his Sting CD, log on to the Net, and add to it more tracks by Sting. At the same time, he'll be able to buy tickets to an upcoming concert or visit a music chat room.

Jones has started seeking alliances with manufacturers of Internet MP3 music players. One is hometown neighbor Thomson Consumer Electronics, whose RCA brand makes the Lyra player. Jones envisions using his CD Database (CDDB) to put the names and cover art of songs onto the Lyra's and other players' displays, since Internet downloads don't include this information. He's trying to make similar alliances with companies that enable digital downloads to be played on a user's CD-ROM drive. His targets include RealNetworks, MusicMatch, Amazon.com, Adaptec, and CDNow.

Jones sees CDDB as being "in the catbird seat," meaning an integral part of the transition from physical to virtual media. Accordingly, he's offering manufacturers a special SDK (software development kit) product to allow them to incorporate the CDDB database into their music players. "What I'm trying to do is be present in the family room where consumers make purchases, and I want to add value to their entertainment," Jones says. "I want to say, 'Do you like this? If so, press this button, and I'll download it to you.' That's really where I want to be." And Jones has to hope that consumers will want to be there, too.

Oleck writes for Business Week in New York


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Escient CEO Scott Jones
(Photograph by Denis Ryan Kelly Jr.)


WEB POINTERS
Click here to visit sites mentioned in the story:
Escient
CDDB
RCA's Lyra
MP3
Thomson's RCA
Forrester Research
RealNetworks
MusicMatch
Adaptec
CDNow
Amazon




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