Consumers Spend $1k – $5K On Home Theater

The report, titled “Home Theater: Selling Surround Sound in an Age of Commoditization,” addresses the paradox of a growing market with shrinking margins. The report found that 24% of U.S. onlinehouseholds now have digital surround sound systems.

“Extremely low priced HTIB – Home Theater In a Box – systems have expanded the market and made surround sound systems broadly affordable, but are not necessarily profitable for manufacturers,” said JupiterResearch Senior Analyst Avi Greengart. “However, we found that 47% of consumers planning to buy surround sound systems are planning to spend $1,000 – $5,000 on home theater products over the next 12 months. Consumers have clear feature and brand preferences that vendors can address to move consumers into higher priced, more profitable products,” added Greengart.

The Home Theater research service marks the eighth new practice started by JupiterResearch since its acquisition in July 2002 by Jupitermedia Corporation. This service helps vendors prepare for market opportunities created by the explosion of new home entertainment technologies and deliver insights on consumer needs and expectations, enabling better decisions about such topics as convergence and optimal form factors, while helping vendors develop strategies to maintain margins in the face of rapid commoditization. The JupiterResearch Home Theater research service uses consumer and executive IT surveys, online analysis, case studies and usage models. Clients of the service will better understand real consumer needs, price points, the value chain, distribution models and market entry strategies. This JupiterResearch initiative is led by Vice President & Research Director Michael Gartenberg and Senior Analyst Avi Greengart.

JupiterResearch’s Home Theater Watch Weblog, www.HomeTheaterWatch.com, was launched in March, 2004 as a companion to the Home Theater research service and provides additional news, analysis and insight relevant to the areas most important for the growth of home theater and digital home entertainment.

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