Home Theater to Exact its Revenge on the PC?

Tele-Webbers---almost sounds like a mindless new children's TV show, but instead describes what a new report claims is the next big revolution in home television. According to the report from Inteco, Tele-Webbers are the eight million adults in the US who use the Internet and watch TV simultaneously at least once a week. (So do another five million, but less often.)

PC makers have been trying to edge themselves into consumers' homes for years, and with profit margins per PC dwindling, hope to make up in volume what they can't in mark-up. But there's one small problem: most consumers can't seem to find a compelling reason to buy a PC---except to browse the Internet. Recent surveys contend that 80% of the consumers who buy PCs do so to get online. Predictions also forecast less than 54% of US homes having a PC by 2003, a modest growth from the 45% that currently have them.

PC makers hope that by adding media features to the PC they will entice young buyers to add bigger speakers, and maybe a video monitor. On paper, the PC, with built-in DVD player, gaming capability, surround-sound software, and Internet hardware, looks to be the perfect family-room product. But with digital TVs and set-top boxes connected with Internet-savvy cable modems hitting homes in the coming years, using your TV to send the occasional e-mail and conduct online shopping makes more sense than buying that desktop computer.

"This study does sort of point toward a future where the TV is ubiquitous, not the PC," said Mark Snowden of Inteco. "It's been the dream [of the PC industry] to have the PC on every desk. That's not going to happen." Mr. Snowden also stated that "the characteristics of this group [Tele-Webbers] should be of particular interest to advertisers and content suppliers looking for synergy between the two media." The report is based on 2500 detailed interviews conducted in May.

Inteco says that the eight million who simultaneously surf the web and view TV at least once a week are keenly interested in visual presentation, are highly receptive to advertising, and view the Internet as a form of entertainment. What is unexpected, Snowden noted, is the extent to which this group uses electronic commerce. Apart from familiarity with the Internet, there is little to indicate that this group should have any greater interest in electronic commerce than the average Internet user. However, between January and March 1998, Tele-Webbers made 25% more purchases than the average for all Internet users, and spent 50% more.

"Clearly, synergistic opportunities exist between TV and the Internet," Snowden said, "either in terms of complementing TV programming with simultaneous website information, or by using TV advertising to direct mass audiences to websites. As this group becomes larger and more mainstream, its behavior will provide valuable guideposts to the future of these two powerful media."

In the long run, then, consumers may be more willing to add e-mail and e-commerce to their home-theater systems than add home theater to their computers. Watch for more deals between major consumer-electronics companies and PC makers as the scramble for eyeballs continues.