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NETWORKS IN THE HOME: ANALYSIS AND FORECASTS (3rd EDITION)
ENTERTAINMENT-CENTRIC NETWORKS

AN INDUSTRY REPORT FROM PARKS ASSOCIATES

By Kurt Scherf, Vice President, Principal Analyst

 
CONTENTS

 

1.0 Introduction to Digital Entertainment
   1.1 Purpose of This Report
   1.2 Trends in Digital Technology
   1.3 Definitions and Applications
      1.3.1 Digital Music
      1.3.2 Enhanced TV
      1.3.3 Digital and High-Definition TV
      1.3.4 Interactive TV
      1.3.5 Internet TV
      1.3.6 Personalized TV
   1.4 The Home Entertainment Network Defined and Classified
      1.4.1 Classifying Entertainment Networks
      1.4.2 How Will Entertainment Networks Manifest Themselves?
   1.5 Forecasts
   1.6 Challenges to the Vision

2.0 Enhanced Entertainment – Overall Trends
   2.1 Technology Trends
      2.1.1 Analog-to-Digital Content
      2.1.2 Wider Bandwidth
      2.1.3 Broadcast vs. Streaming and Downloads
   2.2 Audio and Video as Drivers for Entertainment Networks
      2.2.1 Digital Music
         2.2.1.1 The Major Record Labels and Online Content
         2.2.1.2 Digital Music Market Accelerators and Inhibitors
            Digital Music Formats
            Music Library Management
            PC-based Digital Music Software
            Other Content Aggregation and Networking Software
            Free Music
            Pay Internet Music Services
               RealOne™ Music Pass
               pressplay
               emusic
               Listen.com Rhapsody Service
               FullAudio
      2.2.2 Consumers and Internet Music
         2.2.2.1 Consumers Using the Internet for Audio Applications
         2.2.2.2 Who is an “Internet Audiophile”?
         2.2.2.3 Consumer Reaction to Pay-Per Audio Services
         2.2.2.4 Consumer Interest in Listening to Internet Radio on a Stereo
      2.2.3 Internet-based Digital Video Content Services
         2.2.3.1 Consumers Using the Internet for Video Applications
         2.2.3.2 Who is an “Internet Videophile”?
         2.2.3.3 Consumer Reaction to Pay-Per Video Services
         2.2.3.4 Overview of Some Providers
            Intertainer
            CinemaNow
            Movielink
         2.2.3.5 Frequency of Merging Online Activities and Television Viewing
         2.2.3.6 “Telewebbing”
            Households that Participate in “Telewebbing”
            How Many Internet Households “Teleweb”?
            With What Kind of Content do Internet Households “Teleweb”?
            Future Opportunities in “Telewebbing”
            Internet Households Interested in Future “Telewebbing” Opportunities
            With What Kind of Content Might Internet Households “Teleweb”?
      2.2.4 The Market for Enhanced TV
         2.2.4.1 Enhanced-TV Market Accelerators
            Strong CE Spending
            Family Budget can Afford it
            Multicasting
            Better Picture Quality
            Wider Screen
            Improved Surround Sound
            More Programming Choices
            Electronic Program Guides (EPGs)
            Simpler Remote Controls
            Interactive Services
            Enhanced Set-top Boxes
            Available Content
            Content Archives
            Movie Libraries
            Repackaged News
            CE Subsidies
            Other Subsidies
            Asset Protection
            Interactive TV
            Broken Business Models
            Increased Ad Revenue Potential
            Cheaper and more Targeted TV Ads
            Mass Customization
            Experienced Call Centers
            Lower Operating Costs
            New Revenue Sources
            Distance Learning
            Broadband Competition
            Semiconductor Competition
            Availability of High-definition TV Sets
            Separation of Function
            Video Format Conversion
            Home Networks
            The Master Set-top Box
         2.2.4.2 Enhanced-TV Market Inhibitors
            Inadequate Management Systems
            Expensive Infrastructure Upgrades
            Dearth of Compelling Content
            Risky New Business Models
            High Consumer Cost of HDTV
            Price vs. Quality
            Large Screens Take Up Space
            Installed Base of Legacy TVs
            High Consumer Cost of Set-top Boxes
            Installation Hassles
            Long-Term Commitments
            FCC Deadlines Won’t Hold
            Lack of Market Demand
            Personal Privacy
            Established Usage Patterns
            No Guarantee of Service Quality
            Inadequate Home Wiring

3.0 Market Forecasts: Home Entertainment Networks
   3.1 Classifying Entertainment Networks
      3.1.1 Point-to-Point
      3.1.2 Distributed (Multiroom)
      3.1.3 Cluster
   3.2 Home Entertainment Network “Kits”
      3.2.1 Audio Applications
         3.2.1.1 The Home PC as a Virtual Jukebox
         3.2.1.2 Characteristics of an “MP3-phile” Consumer
         3.2.1.3 Growth in Internet Radio Listenership
         3.2.1.4 Consumer Interest in Audio Networking Applications
            Consumer Interest in PC-to-Stereo Networking Solution
      3.2.2 Video Applications
         3.2.2.1 Converging the PC and Entertainment Environments
            Computers Located in Close Proximity to Primary Home Television
            Location of TVs and PCs
         3.2.2.2 Consumer Interest in Digital-to-Analog Connectivity for Video
      3.2.3 Forecasts for Home Entertainment Network “Kits”
         3.2.3.1 Examples of “Kits”
         3.2.3.2 Home Entertainment Network “Kits”: Node Growth (2002-2006)
         3.2.3.3 Home Entertainment Network “Kits”: End-User Market Value Growth (2002-2006)
   3.3 Network-capable Consumer Electronics Platforms
      3.3.1 Set-Top Boxes
         3.3.1.1 Drivers for Deploying Set-top Boxes: The Cable Industry
            Network Upgrades
            Evolution of the Set-top Box Platform
         3.3.1.2 Forecasts (2002-2006)
      3.3.2 MP3 Jukeboxes/Internet Radios
         3.3.2.1 Overview and Examples of Platforms within Category
         3.3.2.2 Forecasts (2002-2006)
      3.3.3 Personal Video Recorders
         3.3.3.1 Overview and Examples of Platforms within Category
         3.3.3.2 Forecasts (2002-2006)
      3.3.4 Game Consoles
         3.3.4.1 Overview and Examples of Platforms within Categor
         3.3.4.2 Forecasts (2002-2006)
      3.3.5 Web Tablets
         3.3.5.1 Overview and Examples of Platforms within Category
         3.3.5.2 What Kind of Content is Desired from an Information Appliance?
         3.3.5.3 Forecasts (2002-2006)
      3.3.6 Total CE-centric Market
      3.3.7 Nodes Connected in CE-Centric Entertainment Networks
   3.4 Summary of Forecasts

 

FIGURES

Figure 1-1 Home Networking Applications Categorized
Figure 1-2 Cross-category Interest in the Networked Home
Figure 1-3 Consumers and Downloaded MP3 Files
Figure 1-4 Average Number of Downloaded/Stored MP3 Files
Figure 1-5 Interest in a PC-centric Entertainment Network
Figure 1-6 Non-PC Information Appliances Drive Entertainment Network Growth
Figure 1-7 Digital-to-Analog ‘Kit” Entertainment Nodes
Figure 1-8 Growth in Network-Capable Entertainment Devices
Figure 1-9 Products Connected in CE-Centric Home Entertainment Networks

Figure 2-1 Download Speeds: Dial-up vs. Broadband
Figure 2-2 U.S. Music Sales: Retail vs. Online
Figure 2-3 U.S. Music Sales: Online vs. Download
Figure 2-4 Consumers and Internet Audio
Figure 2-5 Characteristics of Internet Audiophiles
Figure 2-6 Consumer Interest: Pay-Per MP3 Download Service
Figure 2-7 Consumer Interest: Listening to Internet Radio on a Home Stereo
Figure 2-8 Consumers and Internet Video
Figure 2-9 Characteristics of Internet Videophiles
Figure 2-10 Consumer Interest in Downloadable Movie Service
Figure 2-11 Frequency of Watching TV and Surfing the Internet
Figure 2-12 Frequency of “Telewebbing”
Figure 2-13 Content with Which “Telewebbing” Has Taken Place
Figure 2-14 Interest in “Telewebbing”
Figure 2-15 Possible Content for “Telewebbing”
Figure 2-16 TVs vs. PCs

Figure 3-1 Percentage of Users Storing MP3 Files on their Home PCs
Figure 3-2 Average Number of Stored MP3 Files
Figure 3-3 Characteristics of MP3-philes
Figure 3-4 MP3-philes and Internet Audio Content
Figure 3-5 Percentage of Americans who have Listened to Internet Radio
Figure 3-6 Interest in a PC-centric Entertainment Network
Figure 3-7 Networking a PC to Stereo Equipment
Figure 3-8 Consumers Interest: PC-to-Stereo Networking Solution
Figure 3-9 PCs Located/Used in Close Proximity to Primary TV
Figure 3-10 Location of TVs and PCs
Figure 3-11 Networking a PC to Television
Figure 3-12 Consumers Interest: PC-to-TV Networking Solution
Figure 3-13 Examples of Entertainment Network “Kits”
Figure 3-14 Growth in Entertainment “Kit” Nodes
Figure 3-15 Annual End-User Market Value: Entertainment “Kit” Nodes
Figure 3-16 Non-PC Information Appliances Drive Entertainment Network Growth
Figure 3-17 Broadband Upgrades as a Percentage of the Total MSO Cable Plant
Figure 3-18 Evolution of the Digital Set-Top Box
Figure 3-19 Average Number of Set-top Boxes in Households
Figure 3-20 Network-Capable Set-Top Boxes (2002-2006)
Figure 3-21 Digital Music Players
Figure 3-22 Digital Music: Extended to the Whole House
Figure 3-23 Network-Capable MP3 Jukeboxes/Internet Radios (2002-2006)
Figure 3-24 Network-capable Personal Video Recorders
Figure 3-25 Network-Capable Personal Video Recorders (2002-2006)
Figure 3-26 Percentage of Americans Who Play Video Games at Least Once per Week
Figure 3-27 Network-Capable Game Consoles (2002-2006)
Figure 3-28 The Web Tablet as a Node in a Home Entertainment Network?
Figure 3-29 Desired Content on an Information Appliance: 1
Figure 3-30 Desired Content on an Information Appliance: 2
Figure 3-31 Network-Capable Web Tablets (2002-2006)
Figure 3-32 Growth in Network-capable Entertainment Devices
Figure 3-33 Products Connected in Entertainment-centric Home Networks, in Millions
Figure 3-34 Growth in Connected Entertainment Products

 

ATTRIBUTES

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in any form or by any means, without permission in writing from the publisher.

Printed in the United States of America.

 

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