Intel is stepping deeper into the consumer electronics market. The company hopes to put an Intel chip inside a plethora of home entertainment devices, including televisions, portable media players, and PCs designed for the living room, Paul Otellini, Intel's president and chief operating officer, announced here at the Consumer Electronics Show.

Otellini shed light on Intel's plans to enter the digital television market later this year, reports of which surfaced last month. Intel will manufacture a line of LCOS (liquid crystal on silicon) chips code-named Cayley that will find their way into rear-projection televisions by the end of this year.

The company hopes its chips will allow television vendors to sell thinner and cheaper rear-projection televisions, reducing the cost of a single television by moving much of its electronic complexity into silicon.

Texas Instruments currently dominates the market for rear-projection digital televisions with its DLP (digital light projection) technology, but LCOS will produce sharper images at a lower price, according to Otellini. By 2005, consumers will be able to purchase a 50in LCOS television with Cayley chips for under £1000, claimed Otellini.

Intel also hopes to popularise a new PC design it is calling the entertainment PC, including a next-generation audio standard for PCs, and Grantsdale, a forthcoming chip set that will allow desktop PCs to become wireless access points.

The company also showed a number of portable media players using its XScale chips. The XScale chips, which are normally found in personal digital assistants, will allow device manufacturers such as Creative Labs and Samsung to build portable media players that can handle video as well as audio.