I spoke with Carl in the Theta suite at the Venetian today. Most of this is what we've heard before, but the summary is:
1. They had a non-working CBIII in the suite that included a card with 4HDMI in/1HDMI out. The CBIII was closed up, so I could not determine whether the card was "real" or just a back-panel mock-up.
2. The literature with the CBIII said the card will be HDMI 1.3b and I was told that it would allow the CBIII to use full lossless multichannel.
3. There is NO video processing planned. I was told that the HDMI out is intended only to allow video switching for the HDMI inputs, sending the video unprocessed to your own processor or projector.
4. I was told that the hardware for the HDMI card is essentially done and that the delay in release is to get the software written and fully tested. It sounds as if the software rewrite is, if anything, more complex than just rewriting the entire operating system.
5. Release date, as already reported, is "summer 2009." Carl acknowledged that this project is necessary to keep the CBIII competitive and said it is "the highest priority project" at Theta.
6. Price still not final but estimated at around $4000.
Bottom line, in my view, is modestly discouraging. They do not have a working prototype they are willing to demonstrate yet. The schedule has slipped from last year (when they acknowledged to me that the CBIII would be effectively "off the market" if the HDMI product was not out by this CES). With no working demonstration, it seems possible (though not likely) that Jeff will be right and HDMI just cannot be retrofitted because of technical problems.
On the other hand, the statements still indicate full commitment to the project and they have not suspended efforts to deliver it despite the economy. I, like Steve, plan to wait but keep my eyes open for alternatives. Even without lossless audio, the CBIII still produces some of the best digital sound I've heard.