New study by TDG Research suggests that nearly one in four consumer electronics devices will include networked DVD functionality by 2010.

The battle for the digital home is pitting CE industry stalwarts such as Sony and Samsung against PC and networking manufacturers such as HP and Dell. But according to Convergence Media Platforms: The Case for Networked DVDs, a new study by research consultancy, The Diffusion Group, the majority of these “converged devices” will be not be based on PC reference designs but rather on traditional CE platforms that combine DVD functionality with network capability.

“Consumers understand the ease of use and features of a DVD player,” said Predrag Filipovic, Ph.D., a consulting analyst with TDG Research. “Any manufacturer hoping to succeed in the converged home media space should look to leverage a platform or feature set with which consumers are comfortable, as opposed to crafting an entirely new product category like ‘media servers,’ an amorphous concept void of any meaning to the average consumer.”

“It is important to remember that DVDs found their way into mainstream U.S. households faster than any other CE device in history,” continues Filipovic. “Emulating this diffusion curve should be the goal of every convergence platform, and what better way to accomplish this task than by making a DVD platform the center of the device concept – whether the device is simply a networked DVD player, a ‘home theater in a box’ or HTiB solution, or a next-generation set-top box. This is in no way meant to suggest that DVD functionality is to be the sole feature of these networked solutions, only that it should be the feature around which converged media is sold to consumers. Given the widespread familiarity and comfort consumers have with DVD players, the concept should be leveraged as the centerpiece around which early convergence platforms are positioned and marketed.”

However, the success of these devices is not solely on the shoulders of the CE manufacturers. “Entry of networked multimedia devices into the mainstream market will most likely occur only when the major technology leaders begin to commit the marketing resources necessary to transform consumer consciousness,” said Michael Greeson, president of The Diffusion Group. “Just as Intel’s $300 million push for Centrino helped accelerate the adoption of wireless networking technology, the push of major CE and PC players is expected to help the convergence home media market in the U.S. to top $700 million by 2008.”

TDG Research’s latest digital home report, Convergence Media Platforms: The Case for Networked DVDs examines three categories of DVD devices: stand-alone network DVD players, HTiB solutions, and advanced set-top boxes. The report offers an in-depth analysis of each market space as well as forecasts for each device category through 2010. The report is now available for purchase on TDG Research’s website, www.tdgreserach.com.

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