For a variety of reasons, few companies are making a concerted effort to tap the so-called convergence market. Products that link the PC to entertainment systems have been around for years, but none of them have taken hold. Now users are much more interested in converging their digital entertainment systems. And for the first time, there is a viable operating system--Windows XP Media Center Edition--that any PC manufacturer can use to create a media center PC. Developed collaboratively with Hewlett-Packard, the Media Center Edition has been adopted by Gateway and others.

I sat down to talk with Dick Grote, VP of Research and Development for HP, about the development of the Media Center PC and the challenges that remain for future versions of the system.

There are two ways to attain convergence. The easy way is to rig a high-end PC as an entertainment device by adding a tuner card and to load software onto it. This may be easy for those in our audience inclined to tinker with their PCs, but it's far from easy for folks who have a hard time getting the clock on their VCR to stop flashing 12:00. Still, it's easier than trying to convert an entertainment center into a system that works like a PC but is as easy to use as a TV. Which route is HP taking? And which customer base does it seek with its strategy?

HP believes in giving customers the ability to move their digital media to any room in their home. The Media Center PC enables users to converge and control the functionality of many of their digital devices, including their personal video recorder (PVR), stereo, TV, CD, and DVD players and burners, and MP3 players into one all-inclusive, straightforward entertainment PC. This PC can be operated at the "10-foot" experience with an easy-to-use remote control or at the standard "two-foot" PC interface with a keyboard and mouse.

However, at HP we are still not convinced that users want to put a PC--entertainment or not--in their living room. To counter that and truly offer a household-wide digital media experience, HP released the HP Digital Media Receiver. Connected to your PC via a home network, the Digital Media Receiver enables users to stream pictures and music through their stereo or television to any room in the house where those devices reside.

We hope that the Media Center PC will become the hub in the home digital media universe--easily connecting and converging disparate systems into one, easy-to-use system. As I said, our vision is a home where digital media content will be shared fully and transparently between consumer electronic and PC/computation devices. As an example, playing music from a networked PC through the living room stereo should be as easy and straightforward as playing a CD in the living room. When we make it this simple, it will be used and loved by everyone in the home. This is where we want to be going with our products and solutions.

Our target market right now is a space-conscious, digital media enthusiast. Unfortunately, housing continues to get smaller and more expensive. So ideally, this system is perfect for someone like a young adult living in a city apartment.

The Media Center PC was a collaborative effort with Microsoft to develop a platform that any PC manufacturer could use to turn a PC into an entertainment system. Could you describe how this collaboration happened? What role did HP play in it? What role did Microsoft play in it?

In early 2000, HP started an investigation into an "entertainment PC." We based initial concepts on market research and some strong opinions on what the products should be. Later that spring while visiting Redmond, we were shown a concept entertainment PC from Microsoft that looked very consistent with what we had been discussing. It was then that we decided that our entertainment PC needed to be based on Microsoft software solutions, and we started to engage with the eHome team at Microsoft. Throughout the next year we worked closely together in the definition, development, refinement, and market introduction of the Media Center Edition. In October 2002, we released the market's first entertainment PC, the HP Media Center PC--which came loaded with Microsoft's Windows XP Media Edition.

To date, the sales and excitement over this solution have far exceeded our expectations. It was one of the most rewarding partnerships I've experienced in my career and we are very pleased with the result.

The Media Center PC and the Digital Media Receiver are promising products in a quickly emerging category. Just how quickly the category emerges depends on several factors. For one thing, getting all these disparate proprietary products to work together is currently a huge challenge. What is HP doing to overcome the standards issues?

Interoperability of all the products in this space is the key to this category taking off. Standards drive wide adoption. Many of the pieces are falling into place (media types, networking standards, uPNP protocols for example), but work is still necessary to define all the layers in the stack to support complete interoperability. HP is very active in driving across the industry the definition of these standards and protocols to support interoperability.

Another challenge facing folks who want to bring digital music and movies into their living rooms is rights management. Of course, music and film companies want to control their intellectual property (IP) in a way that they can best profit from it. But they won't profit from digital IP if they don't let anyone use it in ways unique to digital media: storing, mixing, fixing, sharing, etc. Without clear direction from the recording and film industries, it is hard for consumers to feel confident about converting their systems to digital. What is HP doing to solve this problem?

HP has a well-defined digital-rights management (DRM) strategy that we feel balances the rights of digital content owners with user free-use rights. This is an important problem that needs to get resolved to drive full adoption.

In the meantime, we ask our consumers to use their HP Media Center PC in a manner that will respect the rights of copyright holders and for lawful purposes only.

While some folks will welcome a Media Center PC into their living rooms, there are issues here that inhibit their widespread use in entertainment centers. For example, if users complain about hard-drive whine in TiVo boxes, what will they say when they have a full-blown PC in their entertainment centers? Also, the PC form factor is not ideally suited to most entertainment centers. And the custom of making things happen from the couch may be harder to manage with PC input devices than with a universal remote. And there are other challenges. What is HP's design team doing to deal with these issues?

Internally, we have always described this problem as "domesticating" the PC. The HP Media Center PC is actually very quiet--less than 30dB. This is a difficult job since we are in effect trying to cool what amounts to a 75-watt light bulb in the middle of the box without the fans sounding like a 747. In general, users are going to expect these products to be silent, connect simply and reliably, have form factors that fit into various places in the home, have simple intuitive interfaces that can controlled from anywhere in the house, and be instantly available. These are all issues that we are working on solving.

In terms of priorities, what is HP working hardest on: Standards, ease of use, interface issues, or expanding the feature set?

Frankly, all the challenges to supporting shared digital media in the home need to be resolved. Some of the problems are more difficult than others, but they all really have to be resolved. At some level we are working on all of them.

What is the ultimate goal of Media Center PC development?

The goal of the Media Center PC development is to increase the relevance of the home PC in the rich digital media genre and contribute to the growth of those solutions that share digital media throughout the home. We want our consumers to consider the HP Media Center PC as their digital home-entertainment media hub.

What is a realistic timeframe for achieving that goal, given all the factors outside of HP's control?

The HP Media Center PC is available today and we feel is a great product. But as with any first-generation product, there are things we still want to add and enhance. Additionally, this is a critical time in which we are garnering valuable feedback from early adopters to help enlighten us as to what functionality and features the market would really like included in future releases of this system. The endgame of full standard-based interoperability of CE and PC devices in the home is a little further out--maybe the middle of the decade. Stay tuned; progress will be very quick and visible as we move along this path.