'Digital living room' getting closer

The electronics industry has long dreamed of giving consumers on-demand access in their living rooms to a universe of movies, music and other entertainment content and information at the touch of a button. Recent announcements from electronics companies, Hollywood studios, Internet firms and cable networks suggest that dream is becoming a reality.

"The vision is coming together," said Van Baker, an analyst with Gartner, a technology research firm.

Here are developments announced just last week:

Silicon Valley startup Roku announced it is teaming up with e-commerce giant Amazon.com to allow owners of its digital video player to rent or buy movies and TV shows from Amazon. The 40,000 on-demand videos from Amazon are in addition to the 12,000 videos from Netflix that Roku video player owners could already choose from.

Valley startup ZillionTV unveiled a service and device that it will introduce later this year. The company, which is backed by five of the six biggest Hollywood studios, plans to offer a free set-top box, to be distributed by Internet service providers, through which consumers will be able to watch about 15,000 videos on-demand.

Time Warner revealed a plan dubbed "TV Anywhere" that would allow cable and satellite TV subscribers to watch on computers or other Internet-connected devices all of the programming they get on their televisions.

With all the recent changes, "it's just become amazing to watch this space," said Kurt Scherf, vice president and principal analyst at Parks Associates, a research and consulting firm.

To be sure, few folks are living in anything close to the digital living room today. Thanks to high costs and resistance to adding another box to their living room entertainment centers, consumers have been reluctant to buy the devices offered to date. And those gadgets still fall short of delivering the unlimited content envisioned for the digital living room.

Baker thinks the true digital living room may still be five years or so from reality.

But electronics and content companies seem to be learning from past mistakes, and in doing so, helping to bring that day closer. Meanwhile, their efforts are pressuring traditional pay TV service providers -- from whom the large majority of Americans receive their video content -- to respond with more on-demand services and digital living-room type services.

The first iterations of digital living room products were often tied to consumers' computers. Either consumers had to connect a device to their computers over a local network to access movies or photographs that were stored on the PC, or they had to plug their PCs directly into their TVs. Both methods proved a hard sell.

More recently, electronics companies have been releasing devices that bypass the PC altogether in delivering digital content to the TV. Roku users, for instance, can order a video from Amazon directly from their couch. The Yahoo widgets on new TVs are designed to be accessed with a remote control, not a keyboard, without ever turning on a PC.

Rather than just having access to locally stored movies and music, devices are now being built around the "cloud media concept," noted Scherf, and can access "all kinds of content ... over the Internet."

The cloud concept has another advantage - it can be cheaper. Because all the content is stored on the Internet, devices don't have to include a potentially pricey hard drive. Roku is offering its device for just $100. ZillionTV plans to charge customers a one-time fee for its device that's even cheaper.

Another theme of the emerging digital living room is lots of options - not just in content but in devices.

Consumers can now get on-demand video on a range of gadgets: on their PC through Web sites such as Hulu; on their smart-phone; in the living room through their cable set-top box; on game systems such as Microsoft's Xbox 360; on multi-function media devices such as Apple TV and inexpensive video players like Roku's.

Consumers also have an increasing number of choices about how to "purchase" the media they consume. They can rent or buy videos a la carte from Amazon, Apple's iTunes and similar services and watch them on devices such the Roku player, TiVo or Sony's PlayStation 3.

With an Xbox 360, an LG Blu-ray player or the Roku device, they can watch as many digital videos as they want for a monthly subscription fee from Netflix. Or, under ZillionTV's model, they can watch shows for free - as long as they agree to watch some targeted advertisements.

"We're seeing experimentation, which is good," said Ben Bajarin, an analyst with Creative Strategies, a technology consulting firm. "I don't think any of the solutions nail it on the head, but we're starting to get closer."

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