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IDC Forecasts Growth for the Media Center PC Market, But Remains Cautious about Mainstream Adoption

The past two months have seen a series of movie download deals involving AOL with Intel, Amazon with six major movie studios, and others, bringing the personal computer closer than ever to a more defined media-centric role. These deals also give consumers another compelling reason to own media-capable PCs. Media center capabilities are seen as value-added features that enable PCs to function as mini entertainment systems in addition to their role as Web surfing, email, productivity tools, and increasingly as Voice-over-IP solutions. IDC believes that the success of media center PCs will be closely linked to the wider availability of content that is now being pushed to consumers. The potential for that success is evidenced by iTunes’ sale of 125,000 Disney movies in the first six days of its service offering.

“Today’s shipment levels of PCs that serve as digital hubs in living room entertainment systems remain too low to be a factor in the overall consumer PC market. However, shipments of media center-equipped PCs are increasing at a phenomenal rate,” says David Daoud, research manager, IDC’s Personal Computing and PC Tracker Programs. “The proliferation of broadband in households worldwide is driving increased use of the Internet for media applications, including audio and video playback and downloading in a multitude of formats and quality levels. As a result, IDC finds that PCs are increasingly used as entertainment devices that complement the traditional living room entertainment system, not replace it.”

IDC’s latest research on media center PCs shows that:

  • In the short term, PC makers, operating environment and software publishers, and component suppliers will make concerted efforts to raise consumer awareness of media center PCs. Already a large share of the desktops currently sold to the consumer market, and to a certain extent notebooks, ship with Microsoft’s Windows XP Media Center Edition as the de facto operating environment. This push is expected to help smooth the transition to Microsoft’s Vista Home Premium when it is released early next year. Additionally, Intel and AMD, and other players in the industry, have embarked on similar initiatives to boost consumers’ entertainment experience in the home.
  • This year, 5.85 million media center PCs will ship worldwide. These systems will have the software and hardware necessary to qualify as media center units, with both the media center operating environment and combined TV tuner and remote control. The value of this market is estimated at nearly $6 billion, with the U.S. market accounting for 46.3% of the total.
  • In the longer term, based on the most likely scenario, worldwide shipments of media center PCs will expand at a compound annual growth rate (CAGR) of 41.3% from 2005 to 2010, with the U.S. market increasing at a CAGR of 34% during the same period. In 2010, IDC expects worldwide shipments to reach 27.5 million units, with 9.5 million units absorbed in the United States, generating a worldwide revenue opportunity of $29.4 billion. The U.S. revenue opportunity in 2010 will be $12.6 billion.

This study, Worldwide and U.S. Media Center PC 2006-2010 Forecast: Opportunities and Challenges in a Growing Digital Home Market (Doc #203368), reviews the current state of the media center PC market worldwide and in the United States. It also forecasts unit shipments and revenue to 2010. Included in this analysis is a review of the PC industry’s competitive position in its efforts to boost PC penetration in the digital home market.

To purchase this document, call IDC’s Sales hotline at 508-988-7988 or email sales@idc.com.

About IDC
IDC is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. IDC helps IT professionals, business executives, and the investment community make fact-based decisions on technology purchases and business strategy. Over 850 IDC analysts in 50 countries provide global, regional, and local expertise on technology and industry opportunities and trends. For more than 42 years, IDC has provided strategic insights to help our clients achieve their key business objectives. IDC is a subsidiary of IDG, the world’s leading technology media, research, and events company. You can learn more about IDC by visiting http://www.idc.com.

All product and company names may be trademarks or registered trademarks of their respective holders.

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