Computer Firms Eye Home Entertainment Centres
"OH MY GOD! Is that an RF antenna?" asks one of four lab coat-clad techies who's just emerged from a black SUV with the FAB FOUR vanity plates. "Somebody call 911 - we've got a digital emergency!" So goes the opening scene of Digital Eye for the Analogue Guy, a slick parody of a popular reality program broadcast during an Intel Corp. presentation at the 2004 International Consumer Electronics Show in Las Vegas. The bespectacled (and somewhat nerdy) foursome invades the home of a digitally deficient family, freeing them from a snakepit of wires and upgrading their obsolete entertainment devices.
Computer companies are trying to invade your living room - again. So the hero of this particular home-invasion show is a computer that runs your entertainment centre. Now, before you don your Archie Bunker scowl and proclaim you'll never - ever - allow a computer anywhere near your reclining chair, understand it doesn't have to look like a computer. Instead of a dull grey tower, it could look like a DVD player or stereo component. And instead of using a mouse and keyboard to access things, you could record TV shows, watch DVD movies and listen to MP3s with a remote control, anywhere in the house. It's enough to make you want to be the next target for the crew of Digital Eye.
Consumer electronics is a US$100-billion-a-year business in the U.S., and computer companies want a slice of that mammoth pie. So giants like Intel and Microsoft are creating new equipment that will function as your entertainment hub. It's risky. Tech companies have tried to slip into the living room before, only to be rebuffed: most customers found the concept confusing and the early equipment difficult to use. Now, though, it's a necessary gamble if computer firms want to expand their businesses. "That's where the market is," says Eddie Chan, an analyst with International Data Corp Canada Ltd., a technology research firm. "Today, it's all about digital content and how it's being shared."
The driving forces behind the computerized living room are a couple of technologies many consumers have already embraced. The first is the Wireless Fidelity (WiFi) home network that allows all your entertainment components to connect to one another wirelessly. The second is the Napster phenomenon, which introduced consumers to collecting digital versions of songs on their computers. These new computer-entertainment systems will enable users to store and access much more than just music. "Whether it's movies or music or pictures," says Intel Canada's Doug Cooper, "we've moved into an era where all of that can be moved around electronically."
Microsoft has already launched Windows XP Media Center software, a user-friendly system that allows you to scroll down lists of entertainment options that appear on the TV and click on what you want. The computer acts as an all-in-one DVD/VCR/ stereo console that can record and play TV shows, movies and music. Microsoft is also offering an array of Extenders, gadgets that will connect several TVs to one central computer. It's a strategy Microsoft likes to call "seamless" computing. "Think of seams, meaning where things break," explains Greg Barber, director of Microsoft Canada's home and entertainment division. "You don't want to have your movies on a personal video recorder, photos on a camera and music on another drive. You want them all together, accessible from any room in the house. And there's no tool better at connecting all of these than a PC."
All of this poses a major challenge to manufacturers such as Panasonic and Sony, because tech firms aren't just selling computers. Dell and Gateway, for instance, are selling competitively priced, flat-panel TVs too. So consumer electronics companies are fighting back by offering TVs that connect to the Internet and personal video recorders that can tape programs just like a VCR. "We make products that people want," Panasonic executive Fumio Ohtsubo said at the Vegas show. "Some of our friends in the computer industry think this is easy." The battle lines have been drawn, and they go right through your living room.
Maclean's February 16, 2004