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How To Stay Relevant

1/05/2006 02:00:00 AM Eastern

TWICE: During the five-decade span from the 1950s to the 1990s, home audio thrived during most years. How can home audio stay relevant in the first decade of the 21st Century?

Peter Wellikoff, B&W group president: For home audio to stay relevant in the future, there is one simple answer: Make it easy for the consumer to use! Electronics are becoming ever more sophisticated at the risk of completely losing touch with the end user and how they interface with their system. There has been some progress in this area with touch panel control systems, but they generally require expensive programming.

The brands that will dominate in the longer term will invest in technology not for technology's sake but to find ways for the consumer to easily understand and use their products and use them to their fullest capabilities.

Ron Fleming, Thomson, audio/video marketing general manager: Audio systems and components will have to connect to all sources of digital music and not just to an MP3 player. Very few people manage their music on a player; instead, most people with digital music manage it on their personal computer's hard drive. As storage options grow, there will be a need for audio systems and other products to connect to networked storage and also to Internet music services.

Design and fashion trends can also help sell products and should be the part of the answer in MP3 players. But design isn't everything. Consumers expect a high degree of functionality blended with products that are easy to use.

Stephen Baker, Denon president: In the future, virtually all audio products sold will serve as interfaces that connect many different sources of content. For Denon, our challenge is to do it better, add value and provide an upgraded entertainment experience for our customers.

Sandy Gross, Definitive Technology president: Home audio can stay relevant if it focuses on delivering upscale products that offer superior performance that is obvious and easily and quickly demonstrable on the sales floor. Equally important is that the sales floors take the time and effort to properly demonstrate audio. This is also very much tied to how demonstrable the upscale components are in a world where we are trying to sell to non-enthusiast consumers through less than highly skilled salespeople. Also critical is the “impress your friends factor” of upscale audio components, both in terms of cosmetics as well as performance.

Wieger Deknatel, Philips entertainment solutions director: As the use of broadband continues to grow and homes become more “connected,” certainly wireless devices or components that integrate “connect” solutions will be desirable for consumers.

Consumers want the freedom to experience music on their terms. The solution of having music streamed from a main unit in the home to several clients is appealing to consumers because their music is always at their fingertips. Conveniences such as these will be decision factors in the purchase process, so certainly the more freedom a system can allow a consumer the better.

As portable MP3 continues to grow, there is also a need for consumers to be able to listen to their music at home as well. Systems will need to allow for that in order to keep it simple for the consumer.

Design is also key to the future. Consumers want to show off their gadgets, and often it reflects their personal style. We have seen a growth in simple, streamlined designs [in home theater and music systems ] in 2005 and expect that trend to continue in 2006.

Don Milks, Onkyo product and marketing manager: MP3 player connectivity is critical to the success of traditional home components. That's one of the reasons our DS-A1 iPod dock has done so well. Not only did it allow our current models to work with the iPod, but it was also backward compatible with the majority of our components made over the past decade.

David Bales, Pioneer audio marketing manager: Home audio components and systems make a broadband connection to the Internet. PC hardware and software manufacturers, movie studios, music labels and content providers are coming very close to finalizing their business models, content-management schemes and technical standards to begin delivering compelling entertainment content from the Internet aimed at the living room. There will be too much and too many entertainment and information options for CE manufacturers to ignore this new source of entertainment.

Connections to PC are also important. The PC, Media Center devices and Xbox 360 will be major “servers” as well as “clients” for Internet audio and video to the DTV and to multichannel A/V components or systems using wired and no-new-wires networking technologies. We keep preaching that the modem and router should be in the living room where wired-IP components would be located, such as Xbox, the IP phone and TiVo. Wireless clients would include your home PC, work laptop, IP speakers, etc.

Audio components and systems must also make an MP3 player connection to stay relevant. Portable compressed audio devices have become a permanent part of our entertainment culture. The kids will never be without them, and they are home entertainments' next big customer.

Components must also turn into the hub for a custom-installed distributed-A/V system. We are already seeing the product positioning. Today, features such as multiroom/multisource, three-zone capability, configurable amplifiers, discrete RS-232 control, three-zone IR control, 12-volt triggers and so on drive the custom business. These features will evolve to include IP-based distribution. The A/V component, primarily the A/V receiver, is the most logical place to have “command and control” of multizone home A/V. And they will integrate with other home systems, such as lighting controls, if the appliance has an IP address. But these types of controls will come from programs loaded in a PC device that can be preprogrammed to do certain things under certain A/V conditions.

While cosmetics will play a big role as we go “flat,” I think the answer for consumer audio products will rely heavily on retailers' willingness to bring new technology to their showrooms, work with manufacturers to create effective product training, effectively demonstrate the technology and provide solid installation and after-sale customer service. Manufacturers must provide retailers with products that offer margin, performance, ergonomics, functionality and ease of integration.

David Kroll, Boston Acoustics product development director: The growth of the digital music player has radically increased the time consumers spend listening to music. Never have so many listened to so much for so long, and on such little devices. This is fueling unprecedented demand for audio solutions that give consumers the ability to play music any time, any place — from whole-house audio systems, to shelf-top systems for offices, dens and bedrooms, to multimedia systems for PCs. We see more consumers who are willing to play their music more than ever.

One of the important trends emerging from this phenomenon is that form is becoming as important as function, as are ergonomics and ease of use. Simple, intuitive operation — long a Boston specialty — is more important than ever before. These are trends Boston products, like the versatile MicroSystem CD, are well equipped to satisfy, and consistent with Boston's approach toward new product development.

TWICE: Does home audio's future lie in HTiBs and in new-fangled devices such as speaker-equipped iPod docks, broadband-connected tabletop radios/clock radios and one- or two-speaker virtual surround systems?

Wellikoff: Only at entry-level price points.

Fleming: Yes, all that and more. Consumer needs and wants are changing, and the products we produce need to change in anticipation of those changes.

Baker: I don't believe so, or at least not exclusively. These types of devices are for the most part attempting to provide customers with added value by integrating novel methods of content delivery and control within the framework of legacy-type devices. They illustrate the ongoing expansion of content delivery technologies, and these form factors will all evolve.

Bales: There will be a huge market for the items that you mentioned, but I think the vast majority of North Americans will want the “big system” that includes flat HDTV, Blu-ray players and recorders, game consoles and speakers. They will want to have access to the Internet, their PC content and their portable devices in their living rooms.

Kroll: This is a trend that will fuel significant growth in the tabletop audio category. It will appeal in particular to consumers who want simple solutions, using plug-and-play components — and who are seeking to avoid spending the time and money needed for products and systems that require professional installation. Boston is addressing this market with products like our Recepter Radio HD and MicroSystem CD.

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