Study: Internet Radio Will Revitalize Home Audio Market


London - The growth of Internet Radio and networked devices will revitalize the home audio market, Futuresource Consulting contended in a study.

"With the continued rise of home networks, it is evident that Internet radio is here to stay, and it's just a short leap to networked audio," said senior analyst David Watkins

"Server-to-audio networking, combined with wireless multi-room audio systems, is just the beginning," he said. "Several vendors are already developing networked solutions which allow remote control of your iPod and other handheld devices across a home network, effectively turning handheld devices into servers." The "outlook starts to look very enticing" when you throw in the capability of iPhones and iPod Touches to act as both a music source and a wireless remote controller, he added.

Potential applications for networked audio include connecting a laptop to a music system without using wires, a home theater system playing music streamed from a remote PC or media server, and A/V receivers streaming music wirelessly to other devices in the home, he said.

Home audio systems could stream Internet radio through a networked PC, Wi-Fi-equipped smartphone, or Wi-Fi-equipped portable media player, but Futuresource sees more opportunity in home audio devices with embedded Internet radio. "The unique selling point for embedded Internet radio is convenience and immediacy," Watkins said. "There's no need to boot up a PC; you simply hit a button and you're listening to your favorite music or talk show in an instant."

Internet radio can be embedded in A/V receivers, home-theater systems and tabletop radios. The latter market will grow from less than 500,000 units worldwide in 2008 to close to 5 million units by 2013, the company said.

"Networking solutions are on the brink of revitalizing markets for home audio products," Watkins said. But challenges remain. "Ease of use, seamless user interfaces and robust wireless operation are an essential next step to move the market from niche to high volume," the company said. By 2013, however, networked features on medium priced audio devices will be "standard fare," and consumers "will increasingly become dependent on the Internet for their music."

The company's research and conclusions and contained in a 60-plus page report.


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