“There needs to be something beyond backup to make the home server story come alive for consumers,” Gownder says. “The server category has to demonstrate application extensibility where it’s projecting things you couldn’t do previously rather than just being a source of backup and storage. It needs to proactively help people with their media.”

Hewlett-Packard’s Media-Smart Server line, for instance, allows users to store their entire iTunes library on a server, from which any computer in the home network can then stream music. French company LaCie offers its Ethernet Disc Mini Home Edition service that does much the same.

Microsoft, and its Windows Home Server software that it launched in January, is expected to rule the home server market for the next five years, during which PC-based servers will be the dominant solution. But Theocheung says the real spike in consumer adoption won’t come until after consumer electronics companies begin building server-like functions into their entertainment system products, which will overtake the PC as the primary source of such store-and-synch capability. In particular, he expects cable operators to be leaders in this transition, doing for servers what they did for DVRs by including the functionality in set-top boxes.

“That changes the whole model,” Theocheung says. “If you have to buy these yourself, the trend is going to be slower. But when service providers latch onto this and let you just add $5 to your $100 monthly cable bill, it’s not a noticeable impact. Then you’re going to see some action.”

Perhaps when this market begins to expand, music subscription services like Rhapsody and Napster will place support for their technology on these home servers. Rhapsody in particular has been aggressive about making its service compatible with non-PC music appliances. Meanwhile, the move to digital rights management-free downloads for purchased content will also be a key step toward ensuring that digital music takes advantage of the coming media server boom.

Source: Reuters; excerpts, edited by TFW