• by Joe Mandese , August 1, 2005

Consumer electronics and software marketers are racing to develop new media hubs they hope will serve as lynchpins for digital households. And at least one new study suggests one may already be at hand: the personal computer. Companies as diverse as Hewlett-Packard, Linksys, Microsoft and TiVo are each hoping to make their devices or operating systems the digital household's media portal, but consumers have already begun adapting their PCs to handle many of the functions associated with other media, including music, playing games, watching movies and even TV shows.

"People have been talking about the digital households for years, but it already seems to be happening," says Chuck Moran, manager of market research for Burst! Media, which conducted an online survey of 13,000 Web users indicating that the computer is beginning to displace other consumer electronics products.

"It seemed to be taking the place of other traditional entertainment appliances in the home, including the TV, the radio and the DVD player," says Moran, "It seems to be that the computer really is kind of the box that is filling most of the entertainment needs for a lot of people out there, so in a sense, the digital hub already exists for consuming entertainment."

This is especially true among younger media consumers. Nearly 40 percent of people 24 years or younger told Burst! the Internet-connected PC has become their "primary" way of listening to music, while an additional 9.3 percent said it would be in the future. Nearly a third (31.2 percent) of those respondents said it has become their primary means of playing videogames, while more than half 53.3 percent) said they already use Web access to watch movies and other video programming.

"Computers are displacing many household entertainment appliances," said Moran, citing the rise of voice-over-IP phone services, and video streaming as further extensions of the PC's media reach.

The Burst! study coincides with the release of new findings from market researcher Ipsos, which indicate the percentage of consumers aware of digital media hubs is growing. More than a third (38 percent) of consumers said they are either somewhat or very familiar with digital media hubs, up from 36 percent when Ipsos surveyed them in 2004.

"When exposed to the concept, nearly six out of ten (57 percent) consumers show an interest in buying a media hub," said the report, which also found that 27 percent plan to acquire one in the next six months, and 30 percent plan to acquire one within a year.

The Ipsos study doesn't seek to define what constitutes a media hub, but notes a myriad of players ranging from HP, Samsung and Sony to Microsoft, telephone, cable, wireless and Internet providers all are seeking to develop it.

Despite growing awareness and an appetite for a centralized digital media portal within the household, Ipsos Senior Vice President Todd Board said technical barriers may impede the market's growth.

"Brand compatibility, back-compatibility with existing products, functionality, set-up issues and whether or not consumers have a real need for a media hub remain top-of-mind questions," he sated, "but given the combination of a relatively low level of familiarity and strong interest in the marketplace, an opportunity exists for media providers who want to step up and help shape consumer expectations.

The Ipsos research seems to support the findings of Burst!'s study, showing that movies, music and videogames are some of the biggest drivers of a media hub. Asked what media content interested them in the concept, 85 percent of respondents to the Ipsos study cited movies, followed by music (80 percent), TV shows (75 percent), digital photos (65 percent), digital videos (57 percent) and video games (47 percent).