The VCR changed the way people watched TV when it hit the market in the 1970s. No longer tethered to their television sets, consumers could record their favorite TV shows to watch at their own convenience. Consumers now have even more options for recording, storing, and viewing content. Timeshifting devices like TiVo and placeshifting devices like the Slingbox have found favor with from all walks of life (Fig. 1).
This creates a need for pervasive connectivity throughout the home, the Internet, and between networked devices. According to ABI Research, end-user revenues for home networking and linked entertainment are projected to grow from $14 billion in 2005 to $85 billion in 2011.
"The market has reached a major turning point," said ABI analyst Michael Wolf. "Home networking has moved beyond a basic broadband sharing model to one of networked entertainment and convergence the PC, consumer electronics, and communications devices."
Market research firm iSuppli attributes increasing widespread consumer adoption of digital content to the DVR. According to one study, the number of global subscribers to DVR services will reach 83.4 million by 2010, rising at a compound annual growth rate of 43.5% from 12.9 million in 2005.
"DVR is driving the transition of consumer video consumption from broadcast or linear programming to nonlinear video consumption and personalized viewing," said Mark Kirstein, vice president of multimedia content and services at iSuppli.
"As a result, DVR is a pivotal disruptive technology as traditional TV programming adapts to an array of video on demand (VoD), Internet Protocol television (IPTV), and broadband-distribution technologies," he continued. "And DVRs represent most consumers' first exposure to interactive television."
So where will consumers find their digital content? And more importantly, what devices will they use to store and view that content? No one can say for certain. But a lot of it has to do with how consumers use their PC.
The Personal Computer
The PC has long been viewed as a tool for accessing information and completing tasks. In the past couple of years, however, consumers have started to look at their computer as a source of entertainment.
"We have been talking for years about the PC being more than a database storage mechanism," said Sean Wargo, director of industry analysis with the Consumer Electronics Association (CEA). "Consumers are thinking more and more about the PC as the center of their entertainment universe, and a number of devices are building on that."
One thing that is changing the consumer's view of the PC is he declining price of the laptop. A desktop PC is anything but portable, making it an unlikely hug for digital content. The laptop, though, can be taken anywhere. And as the price gap between the desktop PC and notebook computer continues to narrow, more and more consumers are looking to their laptop as a source of entertainment.
"The reality is that people are spending more time in front of their PCs than they do in front of their TV," said Brian Jaquet, a spokesperson for Sling Media, the maker of the wildly popular Slingbox. "There is so much that you can do with that screen. If you can deliver TV on it, what else can you do with it?"