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The Expanding Market for Media Center

January 16, 2007

Chris Lanier has two good posts on how to make Media Center a more widely adopted solution for home media consumption.

From the first:

Media Center PCs just cost too much for many people to consider.  For many people the deciding factor of getting a Media Center PC depends on whether or not they can justify upgrading their current PCs…

Without the addition of HD support the product will die, plain and simple.  For general acceptance of Media Center it had to come.  Now, let’s get OEMs to tackle the newest old problem ever, getting the cost down.

From the second:

As I’ve said before, one of the great things about Media Center is that there are so many ways to use the product. For the most part, you can decide how you wish to use it. Whether you want a PC in every room, or you want a PC in the Living Room with Extenders everywhere else, or a PC in your Office and Extenders everywhere else. You can decide what’s best for you, and to a point that is going to be a problem for Microsoft. Our part of the market already knows how they want to use the product, and those opinions are mixed. When Microsoft makes changes, this might put out part of the market that has already accepted the product, so this must be done very carefully…. Having said that, with how many new product divisions Microsoft seems to keep creating, why not focus on both sides of the market and create a new division to focus on the server aspect of Media Center.

I have thought a fair amount about what it would take to make Media Center better in ways that would make it more widely accepted and have some related thoughts. Five axioms are they key to understanding Media Center’s role in the market.

First, price. Based on my conversation with Dell at CES, I would think we would be able to get nicely configured dual cablecard tuner media center PCs for less than $2,000. (They did not say that specifically, but that is my educated guess from the tenor of the conversation.) This is pricey when compared to paying $13/month for a Comcast HD DVR, but it isn’t out of line when compared to what people will pay for a single flat screen TV, and the a/v equipment to go with it.

Second, Media Center works best as a dedicated device. To the extent that people can be persuaded to spend the money for a dedicated Media Center PC, their experience is bound to be much better than if the PC also doubles as the family PC that gets rebooted often, has lots of applications installed and may hang from time to time because of weird things that a user might be trying. Maybe under Vista we no longer need to worry about these things, but I’m not holding my breath.

Third, one of the great advantages of Media Center is the ability to expand functionality through third party software. Using Media Center 2005 I have the ability to watch video podcasts and ripped DVDs. Such functionality will be a long time in coming to any Tivo.

Fourth, another of the great strengths of Media Center is a great ability to handle multiroom scenarios. I know of no other system (although admittedly my knowledge of high-end proprietary systems is limited) that handles multiple TVs in multiple rooms as well as Media Center and the Xbox 360. You get access to all of your media and TV shows from multiple rooms and can set up new recordings from anywhere. The Xbox 360 operating as an extender brings the reliability and ease of use of a consumer electronics device to the user.

Fifth, for all of this to work reasonably well, good home networking is essential. In my experience this means Cat5 cabling. Maybe the new powerline networking or 802.11n wireless will work well going forward too, but right now nothing beats real wired Ethernet for reliability. This is not cheap, probably adding a cost of about $250/room on average for professionally installed in-wall wiring.

From these axioms we can draw some conclusions about where Media Center is likely to find success going forward:

  1. Media Center is at home in high-end installations. As professional installers become more familiar with the IT skills necessary to use Media Center, its use in homes with high-end installations will be become much more widespread. The existence of dedicated second generation extenders and PC makers like Niveus will accelerate this trend.
  2. Media Center is unlikely to be an economical replacement for a single Tivo or PVR supplied by a customer’s cable company.
  3. Media Center can be an economical and reliable alternative for people who have two or more HDTVs and want a capable system for viewing multiple types of digital media. Several factors can accelerate adoption by such people:
    • A user friendly media center server like the recently announced Windows Home Server.
    • More prevalent home networking– either by more cable being run in peoples homes or more reliable powerline or wireless networking solutions.
    • More prevalent digital media other than TV and DVDs.  This relates to the third axiom above and deserves a future post of its own, but for now suffice it it say that Media Center is probably the best method of enjoying such digital media and the more of it out there, the greater the incentive to use the system that is the best method of accessing it.

This was a longer post an more ambitious post than I had intended to write, so I’ll stop for now. I’m interested to know if others agree with my axioms and conclusions.

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