Inside looking out observations from the dark side of the industry.

After three market research conferences and the broadcast industry conference, we're ready to help you plan your home purchases over the next three years and ... it's all digital!

In the perfect world envisioned (and promoted) by Intel, Cisco, Dell, HP, Sony, Panasonic and others, your home is--or shortly will be--fully networked with a central PC that holds, manages and distributes all of your content to friends and family.

Isn't this beautiful? You shoot digital video on the weekend, have your PVR save your favorite shows, edit/store your video and then send it to your partner and kids so they can enjoy it. Oh yes, they go on their systems and access the TV program library and watch the shows they missed (without the ads to interrupt) or they listen to their favorite music while they read.

Now look around your home. You've probably got two or three PCs of various vintages. We say this because if you're spending time with this article you're more technically advanced than the general population. If you have a network, it is fiber you've run between the systems. What do you do with the network? You share the bandwidth, share printers, share files and work/study (in that order).

Ahead of the Crowd

You're different from most of your neighbors because you are interested in images; but according to a recent IDC study, 54% of the population doesn't even have a camera/camcorder. But you convinced your partner (right after you started using your analog camcorder) that you needed a digital still camera and you either have, or are working on, getting a digital camcorder.

[ILLUSTRATION OMITTED]

You were one of the first people to upgrade your cell phone to a cam-phone and have been clicking away like crazy. The photo quality sucks, but what the heck? In Japan, if a cell phone doesn't have a camera on it, it can't be sold. We're just starting on that cycle.

Digital camera people are staying up late at night trying to figure out how they can beat this movement but the camphone is an impulse image device. That means the people who should be worried about their livelihood are the one-use disposable camera firms. You always have your cell phone with you, so you want a shot--click!

But when you set out to capture moments, digital cameras and camcorders win hands down. That will continue because quality and features are rapidly increasing while prices are dropping. But for phones, the camera is a cute little added feature.

Sucking Up Storage

This year, we all will have shot about 95 billion images. It is estimated that in 2007 we will shoot about 210 billion images. That's a lot of SD cards.

The numbers have gotten so huge for camcorder video, we're already measuring the volumes of captured video in years. This year, camcorder users will capture an estimated 40,500 years of video. In 2007, we will capture an estimated 68,000 years of video.

Out of curiosity, are you doing you part? How many hours of video do you capture per month? No wonder you buy your recordable DVD media on spindles.

Home Network Reality

Because real home networks require either (a) a ton of time and patience, or (b) a certified network installer, your network will probably continue to be what is technically called a sneaker net--make a CD or DVD copy and take it from your PC to someone else's system or DVD player. For all of the hopes and dreams of a centralized family photo/video library, one vital piece is still missing: digital asset management software.

[GRAPHIC OMITTED]

A number of these products were shown at the broadcast trade show, but they cost $5,000-$30,000 and are designed to manage content in huge digital libraries that hold 2-10 terabytes of content--but were priced starting at $20,000. What you want is a small digital library such as the one Pioneer produces for about $1,000--and a $50 piece of software.

Then you'll be able to tell what's on those beautiful CD and DVD discs without having to fast-forward each one. You'll be able to find the specific disc in a minute or less and almost instantly go right to the images or video segment. Cool!

Yes, you did read correctly. I said CDs and DVDs. By the end of the year, your DVD burner may write double layer + or -R; but more than likely it will be a 16x burner that will write to CD-R as well as DVD+/-R ... fast and cheap! Just don't skip the media quality!

       US Only            2003         2007

Broadband to the Home      21%          47%

Satellite Subscribers     21.6M        27.6M

Consumer PC Shipments      20M          27M

PC Households              82M         105M

Home Networks          13M (12.7%)  34M (30.3%)

PC Gamers                  77M         113M

DVR                        1M           14M

Digital TV in Homes        20%          45%

Source: IDC

Digital Still Camera                                         13%
Digital Still Camera & Analog Camcorder                      10%
Digital Still Camera & Digital Camcorder                      3%
Digital Still Camera & Analog Camcorder & Digital Camcorder   6%
Analog Camcorder                                             12%
Digital Camcorder                                             1%
Analog Camcorder Digital Camcorder                            1%
None                                                         54%

N=500

Source: IDC, 2003

Note: Table made from pie chart.