Kirkland TV-device startup is a family affair

Gary and Pamela Hammer did more than help their son Jeremy find a job when he graduated from the University of Washington three years ago.

The Hammer family decided that was a good time to start a technology company, employing Jeremy, two of his classmates and another son who had been working at Fluke in Everett.

Now their company, Kirkland-based Ceton, is releasing a gadget that has caught the imagination of some digital-media enthusiasts and could find its way into the homes of millions of cable-TV subscribers within a few years.

Drawing on the sons' engineering studies, Ceton developed a cable tuner and decoder that plugs into a PC, giving it the ability to play and record multiple high-definition, encrypted cable channels.

Ceton's tuners work with CableCard devices that cable companies offer customers in lieu of cable boxes.

The tuners have powerful, embedded processors that decrypt cable signals and convert them into a secure format used by Windows PCs — up to six channels at once, in real-time.

You could say that Ceton is the latest in a long line of Seattle-area companies promising to deliver valuable content in a fast, secure manner.

This goes back to UPS a century ago and Boeing's airmail service in the 1920s. More recently Microsoft, RealNetworks, Widevine and others have done this with digital-rights-management systems that securely deliver music and video across the Internet and to mobile devices.

Ceton is handling the delivery between cable networks and the Media Center feature in premium versions of Windows.

If Ceton's tuners work as promised — and don't cost too much — they could be key to finally making home theater PCs a reasonable alternative to cable set-top boxes.

Ceton is going to market now with a version for hotels that can receive and redistribute 24 high-def channels at once.

In early 2010, it will begin selling a four-tuner version for consumers PCs, priced between $300 and $600. Prices will be closer to $300 if Ceton gets big orders from PC makers and volume discounts on components.

That will be followed with two-tuner versions costing under $300; one will be an internal PC card and another will be an external device plugged into a USB port.

I mentioned Ceton last month after its tuners were highlighted by Microsoft at a home-theater conference in Atlanta.

When the Hammers were back in town, I went to Kirkland to learn more about this family of hackers and the amazing gizmo they've cooked up.

Inside offices near The Keg Steakhouse, they had a demo ready. Four big-screen TVs, each with a different remote control, were playing different shows, all fed from a Windows 7 PC with a Ceton card inside.

"You can push 'record' from any one of those TV sets in any room and it shows up instantly, to be played back from any other TV set, so all the content's available any time you want it, anywhere you want it, from any room on any HD TV and they're all hooked together," Gary Hammer said.

Hammer is a chemical engineer who used to develop refining simulations for the oil industry. He's a perpetual entrepreneur who, among other ventures, ran a chain of computer stores in Texas and developed homes.

When the family decided to enter the digital-video business, recruiting was the easy part.

Jeremy, 24, developed the custom chip Ceton uses on its cards, while the Fluke veteran, James, 27, designs the circuit boards.

Software is handled by Jeremy's college pals Austin Foxley, 24, and Alex Faucher, 25, who are now part of the extended family and co-owners of the bootstrapped company.

Other friends that have helped Ceton with advice and technical support include Intel and Microsoft, which included Ceton hardware in Windows 7 testing, Hammer said.

A simple solution

Those companies — and the broader PC industry — have been talking up the potential of PC-based home-theater systems for years but it's never really taken off outside the enthusiast market.

One reason is because it's more complicated to set up a PC-based system than ordering set-top boxes from the cable company.

Another reason is because there hasn't been much hardware for digital-cable customers to choose from.

ATI — a division of Intel rival AMD — has sold a CableCard tuner for several years. But it's no longer sold directly to consumers and must be ordered preinstalled on a PC. ATI also opted not to support CableCard on the newest version of its PC tuner.

CableCards are also used in the Moxi set-top boxes that Digeo, another Kirkland company, began selling at retail in January for $799.

You'd think more CableCard systems and tuners would be coming to market, now that Comcast and other cable companies are putting more channels into encrypted, digital formats. That's frustrating subscribers with awkward converter devices, which make PC-based systems more attractive. CableCards plug into specially equipped TVs, TiVos and PCs.

Perhaps bigger companies believe most people will simply pony up for cable boxes.

Hedging its bets

Ceton is hedging its bets. While it's busy trying to get its hardware into PCs, it has also been talking to cable companies about using Ceton tuners. Gary Hammer said some have discussed offering subscribers Windows Media Center PCs with Ceton tuners as an alternative to standard set-top boxes.

In the meantime Ceton will provide a few more pieces for people tackling the home-theater PC puzzle on their own.

Not to mention great jobs for Jeremy and his friends.

Brier Dudley's column appears Mondays. Reach him at 206-515-5687 or bdudley@seattletimes.com.