The consumer electronics industry is
experiencing a "profound change" as fast internet connectivity increasingly
allows previously packaged content to be delivered on a subscription or
service basis.
According to ABI Research, the
consumer market is entering a period of rapid transformation as it moves
away from the models which have historically dominated the personal
enjoyment of audiovisual media.
In the past, the market research firm pointed out, consumers bought a piece
of equipment such as a radio or a TV that would reproduce network content
without additional costs.
The other traditional consumer model, according to ABI, centres on "packaged
media" where a phonograph, cassette player, CD player or DVD player would be
purchased to play media in the form of tapes or discs at additional cost.
Cable TV, however, is disrupting this model by offering premium content for
increasingly higher subscription fees.
Vamsi Sistla, director of residential entertainment technologies at ABI
Research, pointed out that even portable entertainment, such as MP3 player
downloads, is turning into a service-driven business.
"We are not saying that packaged media are going to die out completely, but
this is the way the industry is shaping up," he said.
"And the larger message is that the consumer electronics industry must work
more closely with the service provider industry.
"They are both vying for the consumer's dollar, but they will both lose out
if issues of standardisation and obsolescence are not dealt with more
quickly than they have been in the past."
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