Wiredglitz

Plastic tendrils are clutching my temples, reading electric signals from my brain. I’m sitting in a conference room in San Francisco looking at an orange box floating on a large flat screen. My goal is to make it disappear using nothing but thought. “Cheshire cat,” I think, and the box starts to fade.

No, I haven’t turned into the Mad Hatter, though the device I’m wearing may make me look like one. I’m trying out the Epoc headset, made by a company called Emotiv.

Earlier I calibrated the Epoc by thinking of commands for the orange box when the program asked for them: move left, move right, rise, drop, stop. For disappear, I thought of Lewis Carroll’s vanishing kitty. The Epoc just proved it can remember which areas of my brain lit up while I did that.

“Electric information from the brain is broadcast on the inside of the skull, which is how the headset picks it up,” says Tan Lee, president of Emotiv, via a videoconferencing system. (Like the company’s 10 research scientists, she is in Sydney; 20 employees work in San Francisco.) “By the time it gets to the skull, that information looks very different from the way it does on an MRI scan. So we basically had to unfold the cortex to learn how to read it.”

The $299 Epoc headset launches in early 2010, along with the Windows software that calibrates it. Emotiv’s four scientist-founders hope to make it the basis of a whole new system of computer game playing: “Pressing a button to cast a magic spell doesn’t give you a fulfilling experience,” Lee explains. “But thinking that spell does.”

The Epoc’s tendrils are set to stretch far beyond games. Emotiv has received requests for developer kits from 10,000 software engineers around the world. Applications have been suggested in industries such as aerospace, education and healthcare. Some people with disabilities are already using the Epoc to control their wheelchairs.

The most fascinating — and disturbing — thing about the Epoc is that its software can read emotional states like anxiety, frustration, excitement and engagement. In the calibration software, they are shown rising and falling on a graph in real time, like seismic readings. The idea is that game designers will be able to adjust the difficulty of a given level if you’re frustrated, or change musical tempos depending on your excitement.

As with all transformative technology, the Epoc’s mind-reading abilities are bound to have unintended consequences. I couldn’t ask a question in my interviews at Emotiv without my anxiety level rising on the graph. The days when journalists can smile through dull pitches while keeping their real feelings hidden may be numbered.

Play-it-safe startups, you have been warned.

Courtesy CNN.

It’s 8 a.m. in a San Diego hotel ballroom, and the annual DEMOfall conference is under way. VCs and journalists stifle yawns and peck at laptops. After a morning of scripted pitches by startups that promise to “integrate smartphone remote mobile applications” or “monetize social networks by enabling live social interaction around content,” the coffee break can’t come soon enough.

Then Jason Carlson of Emo Labs, a last-minute addition to the schedule, wheels a TV and a set of giant speakers onto the stage. They’re playing the Beach Boys. Carlson whips the speaker box off to expose a sheet of clear plastic, which is producing the sound.

Suddenly no caffeine is required, no jargon necessary. Emo has invented invisible speakers. There are audible gasps. Dozens of digital cameras flash at once. Those same jaded observers start cheering.

“I didn’t think I could give a good presentation that wasn’t one-on-one,” Carlson tells me later. “I was worried I was going to be a failure.” Emo goes on to win $500,000 and the conference’s DEMOgod title.

By some measures, these are lean years for commercial innovation. In a recent Fortune Small Business/Zogby International poll, just 19% of small business owners said they aimed to introduce a new product or service in 2010; that’s an 8% decline from a year earlier. Among those looking to launch, a sizable majority — 77% — described their product as an “incremental improvement” rather than “game changing.” Like those scripted startups at DEMO, most entrepreneurs seem to be playing it safe.

But look closely at the few who are innovating — and at the products that make you go ooh — and another narrative emerges.

Hardware is back with a vengeance. Most successful products coming out of small tech companies in the early 2000s were Internet plays, like Google (GOOG, Fortune 500), Facebook or Salesforce.com (CRM). That territory has now been thoroughly mined. The most exciting products of 2010 will look a lot more like … well, like the breathtaking science-fiction stuff we always expected from the 21st century.

This, our sixth annual Next Little Thing feature, examines four companies whose products have the potential to revolutionize how we work and play. Apart from Emo Labs, there’s WiTricity, which is making electricity as wireless as Wi-Fi; Plastic Logic, whose flexible electronic reader is a generation beyond Amazon’s Kindle; and Emotiv, whose headset reads your brain, letting you control a computer without touching it.

Despite the diversity of their products, these companies have much in common. All were founded by scientists who did groundbreaking research during the 2000s. In all four cases, the founders recruited business leaders with the chops to commercialize their ideas. All are ambitious, yet modest enough to know they can’t grow without hundreds of developers and equipmentmakers. And all have one major hurdle to overcome: mass skepticism.

As Eric Giler, CEO of WiTricity, says of being headhunted by the company: “I thought, ‘Well, this is impossible. But if it’s true, the world will change.’”

Invisible Sound
Invisible Power
Flexible Reader
Reading Brain Signals