Abstract

A Wide Range of Solutions

In this transitional period between the dominance of traditional audiovisual equipment and the rise of digital devices, there is considerable variation in the number and type of digital audiovisual products that individual households own. This variation is reflected in the different types of living room entertainment center that households set up. Demand for living room entertainment center solutions is thus far from uniform.

It can be anticipated that more uniform, standardized living room entertainment center products will not emerge until digital TV has achieved higher penetration and the online media market has taken off, creating the potential for synergy with mobile entertainment device content. The current situation is that an extremely wide range of solutions is available for home users to pick and choose between.

Still Some Space for the PC

It seems unlikely that any one device will come to dominate the living room entertainment center. Instead, a large number of product types will coexist, meeting the divergent needs of individual households. Under these circumstances, the living room PC or EPC will continue to enjoy significant development potential. With living room multimedia applications still in a state of flux, the PC may be one of the best solutions for coping with a rapidly evolving digital entertainment environment.

Environmental Friendliness Key for the PC

As shown in the diagram at the beginning of this report, the main sources of audiovisual content for the living room are the TV, DVDs, the PC and the Internet, supplemented by digital content generating sources that include DV and DSC (Digital Still Camera). Of these, the PC is the most important multimedia file provider for the living room entertainment center.

In the new era of digital entertainment, the PC is sure to establish itself as a multimedia server for the digital household. However, if it is to function as a server center, the PC will need to be capable of continuous, 24-hour-a-day operation. Not only will the PC have to conform to more rigorous hardware specifications, the problems that have plagued PC users for so many years - high electricity consumption, noise and excessive heat production - will need to be solved.

Do DMAs Obiviate the Living Room PC?

For the members of a household, the living room is a shared space for interaction and entertainment. The types of entertainment activity for which the living room is used most frequently include watching TV, playing DVDs, VCDs and CDs, using game consoles, and using home Karaoke equipment. For all of these activities, there already exist consumer electronics that are easy to use and relatively inexpensive. Although new demand for the playing of digital multimedia files can be expected to develop, given the level of development that LAN and WLAN networks have reached, these files would not necessarily need to be played using a PC; a media adapter could be used instead. However, as multimedia files and streaming video/audio files still have to be stored on a PC, the PC will still be needed to serve as a home audiovisual server. The ability to perform this function will become a major selling point for the next generation of home user PCs.

Consumer Electronics to Continue Dominating the Living Room

Besides display devices such as TV sets and projectors, and audio output devices such as home movie theater speakers, the other types of audiovisual device that are most commonly found in the living room include the DVD/VCD player, SACD (Super Audio Compact Disk) player, PS2 or X-Box game consoles, Karaoke machines, DVD recorders and HDD-type recorders. People have grown used to using these types of consumer electronics. Not only are they easy to use, the functions they provide have reached a high level of development, giving them the capability to meet most of today's living room entertainment needs. There is little sign that the PC is in a position to replace these devices.

The PC's Supporting Role

For the most part, home appliances are designed to provide a single type of function; in this respect, they are significantly different from the multi-function PC. However, because the performance of the types of home appliance used in the living room is so high - in terms of how easy the user interface is to use, the sound/picture quality etc. - and because the overall cost of ownership is often lower than it would be with a PC, the only real advantage that the PC enjoys in its effort to establish itself in the living room is its ability to play different types of multimedia files and its Internet access capability. It can therefore be anticipated that the PC will play only a supporting or ancillary role in the living room entertainment center of the future.

PCs Should Focus on Bedrooms, Studies

Rather than focusing too heavily on the living room, PC vendors would be well advised to consider the opportunities presented by the other rooms in the house. People use their bedrooms for a wide range of functions that include work, study, using the Internet, and entertainment (both audiovisual entertainment and games). The range of needs may in fact be wider than it is in the case of the living room, and yet the PC can meet all of these needs. Given the combination of limited space and diverse needs that characterizes the bedroom, the PC's multifunctional capabilities stand out. Provided that the PC vendors start to pay more attention to user interface design, the PC has the potential to provide digital integration capabilities in the bedroom that are far superior to those that traditional home appliances can supply.

Whether a PC is being used for work, study, Internet access, watching films, listening to MP3 music files or playing 3D games, in most cases it is the needs of individuals that are being met. In the future, as more and more households come to possess multiple PCs for individual household members to use, the business opportunities that can be developed by meeting this demand - and the related demand for PC personalization - may be far more significant, and longer lasting, than those that can be created by bringing the PC into the living room for shared use by every member of the household.

HDD-type DVR Devices are also a Welcome Addition

Large-capacity HDD-type DVRs can provide a wide range of video content selected by the user, making them an ideal content provision device for use with a TV set or projector, or even for a bedroom PC or a mobile device. Some of the HDD-type DVRs that are appearing on the market now also provide LAN connectivity and USB ports, making it possible to download content from a PC located on the same LAN or from a portable hard drive. What is more, these new DVR models are much less expensive than Japanese-made HDD-type DVRs. The HDD-type DVR thus enjoys certain clear advantages that would make it an excellent choice for the core element in a living room entertainment center, particularly given the strong potential for function integration that would enhance its capabilities still further.

STBs to Enjoy Significant Business Opportunities

One final competitor for the role of core element in the living room entertainment center is a category of online service product that is already on the market - the STB and media adapter. Depending on the types of service being supported, vendors can develop different types of STBs with different functions. By arranging to have STB-based living room entertainment centers set up by the service providers, households can be spared the need to spend time and effort on setting up the system and securing access to content. As broadband penetration rates rise and the range of content available increases, the potential for market growth in this "integrated service" entertainment center sector should be quite considerable.   

Appendix

Definitions

DVR/PVR

Generally speaking, the term VR?(Digital Video Recorder) is used to refer to a platform or system to which signals produced by CCD (Charge-coupled Device) video camera are transmitted after being converted to digital signals. Besides being used to refer to the recording devices used with CCTV (Closed Circuit Television) for monitoring, burglary prevention, entrance control or other security applications, the term DVR is now also used to refer to ordinary digital recording devices of the type used in the home.

The term "PVR" (Personal Video Recorder) is normally used to refer to the STB or DVR that cable TV operators in the US and Europe give or rent to their subscribers. The term is now also being used to refer to other recording devices, particularly smaller ones.

DMA

The DMA (Digital Media Adapter) is a device that can provide wired or wireless Internet access, and that can make use of a LAN to download digital files from a PC and play them using a TV set or stereo system. The term can also be used to refer to a type of application concept, a concept for which many vendors have developed their own product names, such as "Media Adapter", "Network Media Player", "NetPlayer", "Home Media Gateway", "multimedia player", "converter", or "home gateway".

Glossary of Terms