• by Erik Sass  @eriksass1, May 5, 2006

PCs are still the main means by which Americans consume digital media, but those trusty desktops are likely to lose a good part of the traffic to growing competition from "set-top" boxes like DVRs and video game consoles--especially among "early adopters," according to a new study from research firm Ipsos Insight.

"People who are already using DVRs and game consoles have self-selected themselves into a special group," explained Todd Board, senior vice president of technology and communications practice at Ipsos. "They've already signaled there's something different about how they like to consume entertainment, and when we look at these groups you see there's a real competitiveness with the PC from other devices" for digital media consumption.

In large part, this is simply a result of viewing comfort, Board added: "These device preferences are really proxies for the kinds of content experience that people prefer." Although suitable for short-form content like clips and updates, PCs and laptops remain unwieldy for long-form content. Overall, Board said, "watching movies and TV on the PC or portable devices is not exciting to mainstream America yet, as most consumers overwhelmingly prefer the '10-foot' experience for video content."

Of course, the current dominance of PCs is undeniable: according to Ipsos, 88 percent of U.S. adults consume digital entertainment in one way or another, and of these, 61 percent use a broadband-equipped PC, ahead of other platforms like cell phones (13 percent), game consoles (10 percent), and DVRs (8 percent). But the picture changes radically inside the DVR subset, where DVR preference is roughly even with PCs (37 percent and 39 percent, respectively). Game console users show a similar skew.

These data paint a complicated picture, but one thing is clear: as the digital revolution sweeps American households, there's no guarantee that PCs will be leading the way--especially if alternative hardware platforms like DVRs and game consoles enjoy increasing market penetration, as seems likely.

Although PCs with broadband connections might seem like natural candidates for mediating digital entertainment in the household, the technical details of orienting Internet content for long-form viewing still exceed many consumers' patience and expertise. Indeed, according to Board, "a huge question... is how many consumers are willing to bother modifying their desktop PC space to make that more conducive to the 10-foot experience--or to bother configuring device connections to pipe digital content to their TV."

By the same token, unless cable operators radically change their business models, the Internet will continue to enjoy huge advantages in areas such as video searchability, on-demand viewing, and video-sharing, Board noted.

Above all, Board said, as telecoms and cable companies battle each other for dominance in the broadband market, the various content and distribution platforms will seek competitive advantage by reaching consumers in the most convenient way possible: "The key to driving the digital medium into the living room hinges on simplicity, and enabling this 10-foot experience for enjoying Web-driven video content."

As a result, the market will remain dynamic in the near term: "We're going to see lots of different players--infrastructure, devices, portals, everyone--all sniffing around, trying to find ways they might get a piece of this new digital video pie," said Board.

Competition will play a role, of course, but so will cooperation: "A lot of them will be looking for ways they can partner to get an even bigger piece of the pie." Nonetheless, Board hedged his bets: "It's still too early to predict how that will happen."