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The Future of Home Theater PCs Print E-mail
Thursday, 12 January 2006
There is no question that PC convergence is happening in the world of home theater. In the old days of high-end audio, the company with the finest analog products could get the top dollar and the top margins, both at home and abroad. Today, high-end AV electronics are much more based around a super computer than they are built on a beefy toroidal transformer. The chip sets that power your AV preamp, receiver, source devices and video processors are really computers. Your TiVo is very much a computer with a hard drive, an OS and an onscreen interface. Yet, as we look forward to 2006, ask any reputable home theater designer or home integrator and they will tell you they are scared to death of the idea of a home theater PC. They therefore refuse to sell the very early units on the markets.

Currently, the units on the market are woefully underdeveloped in terms of features. Home Theater PCs with HD receivers but no DVRs are common. HTPCs that run like PCs also crash like PCs, which for an installer or integrator is the quickest way to flush your installation profits down the toilet. The only way to record HDTV is off-air and many systems or homes for various reasons, ranging from signal strength to geography, simply cannot receive much or any HDTV over the air. Music management on home theater PCs to this point pales in comparison to what you can get from the likes of Apple in the form of a simple iPod, ReQuest, Qsonix and others. The video processing in most home theater PCs is not comparable to what you can get inside today’s best DVD players and outboard video processors. To sum it up – home theater PCs have all of the potential in the world but no place in your rack today, unless you want to be on the very cutting edge of home theater technology as it develops.

However, it won’t be long before the home theater PC does get into mainstream systems by the tens of millions and it won’t be because we invested in another $1,000 black box AV component. Your first home theater PCs will most likely come from your satellite or cable provider. With MPEG4 video compression on new satellites designed to bring you a lot more HDTV, providers like DirecTV will have to get their HDTV customers up to speed with their new hardware. After investing $1,000 per room on a DirecTV HD 10-250, DirecTV better be prepared to provide customers with a way to upgrade their hardware in a way that doesn’t cost them very much. Signs point toward DirecTV likely leasing consumers hardware like cable companies do. Their relationship with TiVo is seemingly over, with the introduction of DirecTV’s own DVR, which will make it even easier to make a cost-effective satellite receiver that can and likely will do much more.

And DirecTV won’t be the only player in the home theater PC market. Every cable provider and Dish Network will likely have a box that you can lease that can do increasingly more and more. To start, I would expect these early receivers to have DVD players built in, with video processing that might be better than you expected. An HD-DVR of some variety will also be on board. As these products develop, you will see the potential of these audio-video PCs expand greatly to include the addition of wireless Internet hubs, access to downloadable movies in NTSC and then in HDTV via Windows Media 10, as well as downloadable games from the top video game content providers. If Microsoft is in the box with WM10, then why not make the DVD drive play Xbox 360 games for an additional fee? Napster’s “lease your music collection” concept might also work well in the home theater PC world. For a fee of, say, $50 per month, would you consider renting tens of thousands of songs that could be wirelessly networked through your house? Don’t forget the increasingly interesting world of Internet radio to the offerings of these boxes.

While PC convergence isn’t here yet, there are strong reasons to believe it is coming, and it is coming soon. While the potential of the concept of the home theater PC is sky high, cable and satellite providers should be forwarded the three rules of home theater (much like the three rules of real estate): reliability, reliability, reliability. If content providers create products that are unstable or quirky, they could lose clients by the hundreds of thousands. Provide a suite of services that includes more HDTV, easier recording, wireless Internet, video games and music servers, all for a monthly fee, and watch consumers fall all over themselves to sign up.

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