PCs talking and conferencing - HP and Microsoft haven't given up on the dream

Hewlett-Packard has teamed up with Microsoft to improve the communications features for PCs, capitalising on an emerging industry trend.

The two companies are working on a device - code-named Agora - that improves the real-time communications features of PCs, such as video conferencing and voice telephony. A prototype of the device is in the early stages of development.

HP is focusing on the hardware, which includes a flat-panel monitor, speakers and modular bay and expansion ports. It will also have wireless networking capabilities. HP demonstrated the device at Comdex last week but the company does not plan on selling it until 2004. It has not announced pricing plans.

Microsoft is creating software for Agora and - it seems likely, given its licensing strategy - others like it. For example, the company's recently announced Tablet PC operating system has pledges from more than 20 companies to manufacture devices around the software.

"This is where the future of PCs is headed, to more of a communications device," said Rich Dodds, an HP marketing manager for desktops. "Real-time communications is going to become more important for businesses."

Dodds said HP will target cost-conscious businesses with Agora. Workers would be able depend on the device for communicating with each other, thereby cutting travel expenditures, he added.

The device could plug into a PC outfitted only with a processor, memory and a hard drive, making upgrades to faster chips or larger hard drives simple.

Agora represents an opportunity for PC makers to put emerging technologies, such as video conferencing and wireless networking, to practice, said IDC analyst Bob O'Donnell. "There are still problems with real-time communications on PCs. It's still choppy but not because of a product. But bandwidth isn't there yet," O'Donnell said.

Richard Shim writes for CNET News.com