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’04 Audio: Not Your Father’s CES

What a difference a decade makes.

In 1994, many audio suppliers still hadn’t embraced surround sound, the new MiniDisc and DCC formats were slugging it out, and sales of rack systems, shelf systems, and audio components were on the rise. CEA hadn’t begun tracking home-theater-in-a-box (HTiB) sales, and CD boomboxes were hot.

In 2004, the buzz will be about networked audio, full-featured HTiB systems, hard-disc-drive music portables and speakers as flat as plasma TVs. Products such as those will appear in greater numbers during January’s CES.

At CES, suppliers will introduce a greater selection of audio components that use Ethernet connections to stream music from centrally located hard-drive music servers. Even mass-market home-theater-in-a-box (HTiB) systems will connect to the home network. Dealers will also find a greater selection of Ethernet-connected PC-stereo bridges to stream music through a stereo system from a PC’s hard drive. Many of these devices will also transfer video and images from a remote PC for viewing on a TV screen.

In the record-setting home-theater-in-a-box (HTiB) business, suppliers at CES will offer a greater selection of systems to counter potential objections from decor-conscious consumers — and further expand penetration. At least three companies, for example, will show systems with speakers designed to blend cosmetically with flat-panel displays. To attract consumers who don’t want to clutter up their rooms with speakers, multiple companies will demo new systems that produce a 5.1-channel soundfield without placing surround speakers in their traditional locations.

Suppliers also expect HTiB growth to attract more competitors in 2004, some of whom will include speaker makers challenged by a declining component-speaker market.

In other HTiB developments at CES:

  • at least two companies will join Boston Acoustics in offering home theater systems that simplify video connections by upconverting composite and S-video inputs to component output
  • at least two more companies will join Panasonic in offering DVD recorders in an HTiB system.
  • and at least one company will bundle a high-definition plasma monitor in an upscale home theater system bundle.

Compressed music: In headphone stereo, robust growth in the flash-memory and hard-disk-drive (HDD) segments will entice new entrants into the market, prompt others to expand their selections, and enable more suppliers to segment the market with their first sports-style models.

Sales of flash-memory and hard-disk-drive (HDD) music portables are growing faster than any other segment in home, portable and car audio, suppliers said.

At CES, dealers will also find a greater selection of high-capacity HDD models, including a greater selection of tiny models built on 1-inch HDDs.

Acknowledging the proliferation of authorized download services that have adopted the Windows Media audio (WMA) codec and DRM (digital-rights management technology), suppliers will offer more models supporting the codec and DRM.

Speakers: In component speakers, audio suppliers hope to reverse the declining attachment rate of quality audio to big-ticket video-display sales with the launch of speakers whose graceful, trim styles will be as appealing as the cosmetics of flat-panel TVs.

The enhanced styling, suppliers contend, will help eliminate aesthetic objections from consumers who are attracted to flat-panel displays as much for their striking cosmetics as for their picture quality.

By late last year, only a handful of companies had been shipping speakers cosmetically designed to match new flat-panel displays, but this year, the selection will grow.

Also at CES, one company will unveil a single wall-hanging active speaker that delivers all channels of a 5.1-channel source.

With traditional speaker sales on the decline, speaker suppliers at CES will also get more aggressive in the still-growing custom-installation market.

At least three companies, for example, will expand their custom selections to fill price/performance gaps, and one company will reenter the in-wall market.

Some new models at the show are designed to sonically match freestanding speakers to improve the performance of a home theater system created out of a combination of architectural and freestanding speakers.

Other new models provide flexible placement options to meet potential aesthetic objections without compromising sound quality or imaging.