Everyone is talking about the sub-$1,000 PC, which is about the same price as a widescreen TV with Teletext. Software vendors are saying that PCs have to become more user friendly. They no longer want to contend with systems crashes, error messages and 'could not find file' messages.
In other words, the same basic simplicity as a TV.
Microprocessor manufacturers proclaimed they had developed a processor that combines all these functions: television, internet access, DVD drive and PC. National Semiconductor/Cyrix and Intel claim they will be introducing cheap processors to the market soon. And, last but not least, PC manufacturers want to make their machines even simpler to maintain, further minimising the chances of computer crashes.
Again, just like a TV.
Add to this the fact that experiments have already started in European countries where the internet can be accessed from the cable, and the conclusion is simple: if all the rumours are true, PCs will eradicate TVs from people's homes.
This could happen. Recent studies have shown that, depending on the European country, between 18 and 45 per cent of families have a PC in their homes and more than 95 per cent have one or more TVs. An overly saturated market, which is in urgent need of a reshape, you say?
But the computer industry could also do with a change. If it wants to maintain its phenomenal rate of growth, often prompted by foolish Wall Street analysts, it must conquer new markets with new products. And they must do so sooner rather than later because the current purchasing frenzy of companies could drastically drop next year - the Euro and the millennium will take up most of their attention, not the acquisition of new computer material.
It's clear-cut - those who succeed in popularising computers into multimedia TV equipment will revolutionise the home entertainment market, which is, of course, a promising outlook.
However, I hope resellers won't miss out on this home entertainment revolution.
At CeBIT, held in March, I asked National Semiconductor/Cyrix's marketing manager which OEMs the company wanted to sell its new microprocessor to, and he replied: 'Loewe, Bang & Olufsen, Sony, Toshiba, Philips, etc.'
And to whom do Sony, Loewe, Philips et al ship their TVs? Consumer electronics stores. And where do consumers buy their TVs? Consumer electronics stores of all sizes. Computer resellers or distributors are not included in this list.
Although, distributors and resellers already sell Sony and Philips product, you can take it from me that both the Sony and the Philips consumer division is a long way away from the computer division.
This applies to products, mentality, speed of movement as well as price stability.
Generally speaking, classic computer manufacturers like Compaq, IBM, Hewlett Packard and Toshiba will push their multimedia TVs through the channel. They already partially do this by turning to certain retailers that sell TVs, hi-fi equipment and PCs, which is logical because this is where consumers go to buy such products.
Apart from this, there are also thousands of consumer electronics stores that have never sold a PC, but which are the favourite places for people to go TV shopping.
What's the likelihood of the IT channel missing out on the home entertainment market? I am not going to make any wild predictions, but it might be a good idea to reflect on it.
Distributors could talk with consumer divisions and consumer electronics stores to find out more about current habits and ways of thinking. It might even be possible to work out some kind of co-operation agreement. Resellers have to decide whether home entertainment is part of their market segment. If the answer is affirmative, what would then be the best way to convert the existing organisation into a home entertainment friendly area? Which products do they need to do this? What kind of marketing tools are required to be on top of consumers' minds?
Undeniably, resellers have a number of advantages when compared with consumer electronics stores. Primarily, they are accustomed to rapid technological changes (with TVs, the last technological evolution took place about 20 years ago).
Second, resellers have basically grown accustomed to the whims of the internet. An everyday TV salesperson is not as familiar with the internet. Third, software will always play an important role, even for new multimedia/TV products. In this respect also, IT resellers have an important advantage over consumer electronics stores. The key question is how long will these same resellers be able to hold on to this advantage?
The world is rapidly changing for everyone. Naturally, consumer electronics stores will be stocked with new products by their existing suppliers.
They will realise how quickly these new products can provide new growth and new profits. Will these consumer electronics stores be able to fulfil Steve Jobs and Bill Gates' dreams in the end?
If I were a reseller, I would certainly want a piece of that cake. It's definitely worth looking at.
- Jan Pote is editor of PC Dealer, Belgium.
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