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Component Audio Sees Major Changes In Forms, Functions

Home theater receivers are changing their function in home entertainment systems, and component speakers are changing their form.

Receivers are morphing into the hubs of home entertainment and distributed-audio systems, while speakers are assuming more stylish shapes to complement new flat-panel video displays and a home’s decor and will be seen here this week, during International CES.

Combined, the changes could help maintain the forward momentum that the component industry enjoyed in 2004, when factory-level dollar sales snapped back sharply from 2003’s 18.4 percent decline and ended an eight-year string of declining sales.

For the January-October 2004 period, factory-level component sales rose 38.1 percent to $1.045 billion, following eight consecutive years of decline.

Suppliers cite multiple reasons for the turnaround, including more aggressive component marketing by retailers, growing demand in the custom-installation channel, products that simplify the operation and setup of home theaters, and products that look as good as they sound (see roundtable discussion on p. 149-150).

Definitive Technology’s president Sandy Gross said, “The base has been set for a component-audio resurgence lasting a few years.”

The base includes receivers that have morphed into what Harman Consumer Group president Gina Harman called the “hub of today’s and tomorrow’s home entertainment system.” More A/V receivers, she said, “are including features that enhance video performance and make easier the integration of set-top boxes, DVD players/recorders, and other related devices.”

Phil Abram, Sony Electronics VP of home audio/home video marketing, agreed. Consumers are “looking for a product that can ensure some form of device-to-device compatibility,” in part through video upconversion to allow for a single video-cable connection to a TV, he said.

To capitalize on components’ momentum:

  • Boston Acoustics and Samsungare showing their first home theater receivers, all at the high end.
  • Akaiwill enter the component audio market.
  • Denon and Samsung will tap the top in multizone home theater receivers. Samsung plans to show a $4,999-suggested retail model, and Denon will show a new model priced above a suggested retail of $3,000 to bridge the gap between its top-end $6,000 model and a $1,200 model. They’ll join a $6,995 Lexicon model available since last September and a handful of models priced up to $4,500 from several other companies.
  • Companies such as JVC and Boston Acoustics will show their first receivers with USB connections to play back PC audio. JVC will offer two models with wireless connections to a PC.
  • JVC, Marantz, and Panasonic will show their first receivers with HDMI outputs; Denon will show its second. All but the Panasonic versions will upscale video to high definition.
  • Component-video up-conversion will appear in a greater selection of receivers at price points down to a suggested $399 from Sherwood.
  • Several companies will show new speaker solutions that deliver three or more surround-sound channels from a single-front cabinet that mounts on a wall or shelf. They’re from Definitive, Samsung, and Yamaha (see p. 144).
  • Quad and Wharfedale will show their first flat plasma-display-friendly speakers.