In fact, the couch is red. It's always red, and only the light shining on it from dozens of tiny spotlights changes, as Color Kinetics demonstrates the effects possible with its digital lights. Each little lamp contains red, green and blue light-emitting diodes (LEDs), which light up in varying combinations under computer control. "We're revolutionizing the lighting industry with what we consider a disruptive technology," enthuses company president George Mueller, tall and ponytailed with the Gen-X standard goatee. "It's a new way to create light."

Mueller and his co-founder, Ihor Lys, have married computer software to a decade of advances in LED technology. LEDs have become ubiquitous in daily life, glowing from the faces of VCRs, clock radios and microwave ovens. But these LEDs have been humble indicator lights on all manner of electronic appliances. Once limited in brightness and stuck at the red end of the spectrum, LEDs have become more powerful in the past dozen years. And a breakthrough in the early 1990s created blue LEDs, suddenly making the whole rainbow available and holding up the promise of white-light LEDs-either by blending the output of colored LEDs or by more exotic techniques. Color Kinetics buys LEDs from device makers such as Agilent and Cree and incorporates them in lamps that give off virtually any color-changing a white wall or a store display from pale green to hot pink at a whim.