MicroOptical is optimistic about the future, in terms of both economic recovery and technology's role. While we wait for the development of future consumer markets, the current economy allows us to concentrate on industrial applications for our clip-on monitors. Riding out the storm also presents an opportunity to position our technologies for the future.

Based on early use of the Internet, kids have expectations that are not fully appreciated by adults. While adults regard the Internet as primarily an information tool, today's teenagers see it as a communication and entertainment tool, perhaps as important as the telephone. It is only a small leap to think that kids will want portable Internet-based communications such as instant messaging, instant pictures and other services in portable form. The great advances of the last few years in miniaturization make this possible.

But what form will the youth-driven new generation of portable electronics take?

There has been a lot of talk about the convergence of entertainment, information and communications, and there is reason for economic optimism as new products are developed. Our optimism for the longer term is based on the further convergence of communication and entertainment systems with clothing. We see the day when shirts, shoes, eyewear, belts and other clothing will house portable appliances that facilitate communication and entertainment. The personal electronics industry will thus need to become fashion-conscious.

This is already occurring in the handset industry: Cell phone handsets are no longer sold only in gray and black. Handsets can now be purchased on the basis of color and style. More than 60 years ago, cars went through the transition from purely functional to style-driven, and it isn't hard to predict that PDAs and other electronic devices will also become style-driven fashion statements. I think new clothing styles-already fashion-based and aimed at the youth market-and personal electronics will merge, and the companies that position themselves in this area will prosper.

Toward those goals, MicroOptical is developing display systems in eyewear. Style and function are, of course, of great importance in eyewear as well as in clothing. Other electronic devices are showing up in jackets, rings and watches. Can electronic shoes be far behind?

While electronics companies are pressed to push cost of goods for consumer electronics down to the lowest levels (for example, DVD players are selling at retail for $70 or less), kids are still paying $150 for shoes. Think about it: The convergence with clothing might be good for margins, too.