Just look what they're up to in the living-room

Surf the web from your TV, play music downloads through your speakers. Stephen Pritchard sees how computing is changing to suit lounge lizards

Eagerly anticipated, Apple's iTunes online music store finally arrived in Europe on Tuesday. Its iTunes service in the US, which has been running for more than a year, is credited with bringing legitimacy to music downloads, charging $0.99 (54p) per song. Apple now has 70 per cent of the legal music download business in America.

Eagerly anticipated, Apple's iTunes online music store finally arrived in Europe on Tuesday. Its iTunes service in the US, which has been running for more than a year, is credited with bringing legitimacy to music downloads, charging $0.99 (54p) per song. Apple now has 70 per cent of the legal music download business in America.

The service has been a hit with owners of Apple's iPod music player, but iTunes has attracted fans in less predictable quarters, too. Earlier this year, Hewlett-Packard's chief executive, Carly Fiorina, announced that HP would both ship Apple's iTunes on its PCs, and sell its own version of the iPod.

But for all the hype surrounding iTunes there was a potentially more significant, though low-key, Apple launch a few weeks earlier.

AirPort Express is a box that plugs into a wall socket and can link up to 10 computers to the internet. It also has cable sockets to connect to hi-fi speakers. Apple has done this so people can listen to their iTunes music collection without the need to have a computer in the living-room.

And it is the living-room, not the office, which is increasingly the focus for IT companies. While sales of business computers have been flat over the past two years, consumers have continued to spend on electronics and entertainment equipment. Shane Robison, HP's chief technology officer, puts the size of the consumer entertainment market at well over $1 trillion. "The newer area for us is digital content and rich media," he says.

HP recently announced a range of media PCs that can connect to cable, satellite and terrestrial broadcasts, as well as to the internet.

Intel, the microchip manufacturer, has also unveiled a computer chipset, Grantsdale, which has built-in support for home entertainment features such as digital surround sound. Intel, according to its vice president, Louis Burns, is investing in designs for computers that will fit under the television set or replace the home entertainment or audio-visual "stack".

This might appear ambitious, even for a company of Intel's size. The idea of home entertainment and computer convergence has been around for a decade, and numerous IT companies have produced plans for digital homes. Few products, though, have been a success. "There have been living-room PCs before, but they were not quite good enough," says Mr Burns. "We are now developing entertainment PCs for the hi-fi stack, but they are sophisticated in looks, technology and simplicity."

Better design, although important, is not the only step forward that could bring new life to the entertainment PC. Changes in the way media content is delivered - in particular the move from analogue to digital content - has opened up new opportunities for computer firms to make inroads into the home entertainment market. "Nobody will buy a PC simply to replace a DVD player," says Mr Burns. "But people will buy it to replace their audio-visual stack or to create the stack they want. An entertainment PC can replace the games box, the surround sound processor and the DVD player."

Technologies such as personal video recorders (PVRs), including Sky+ and TiVO, are starting to persuade consumers to store TV programmes on a hard disk, instead of tape.

Improvements in screen technology, especially flat panel displays, also make the entertainment PC a more attractive proposition.

Households no longer have to put up with either an ugly PC monitor in the living-room, or to be forced to surf the web on an unsuitable TV set.

Paul Jackson, an analyst at technology research firm Forrester, says: "Everything is now digital, so the device is far more irrelevant than it was. We have also seen convergence of the infrastructure, including broadband, Wi-Fi and next-generation data networks. The idea that content is created just for one device is no longer relevant."

But the arrival of low-cost, wireless networking is one of the most significant shifts in home entertainment. Most PC firms seem to be concentrating on either making computers with added media functions - running Microsoft's Windows Media Centre software, for example - or entertainment PCs that replace the growing number of boxes under the typical TV set. But not all manufacturers agree that a single, PC-based box is the way forward.

"What consumers want is to be able to access information they have on their PCs, but have it fed through to their main viewing environment, which is not the PC but the TV set," says Dale Heathcote, the UK commercial director at Humax, which makes Freeview digital boxes and PVRs. "But they also want to be able to access that information in other parts of the house. They want it to work as seamlessly in the kitchen as it does in the living-room."

Consumer electronics companies understand this, perhaps better than their PC-based rivals. Sony has brought out boxes that allow users to share content, such as music or digital photos, from a PC in one part of the house to a TV in another. Philips makes a stereo that can connect directly to the internet to tune to online radio stations. Apple's AirPort Express is driven by similar ideas, as owners can "stream" content from a computer running iTunes to a hi-fi or speakers. Industry watchers believe this type of device will prove popular, as consumers who store media content on one device -whether a PC or a portable player such as an iPod - will not want to be restricted to watching or listening to that content in just one part of the home. This is particularly the case for downloaded content, where there might be no CD or DVD to fall back on.

With wireless technology falling in price, consumers may opt for cheap, add-on networking devices to link up their existing computers and entertainment systems. They might do this rather than replace their current set- ups with a PC-based device, however feature rich.

With computer firms ramping up production of entertainment PCs, the coming Christmas buying season will see whether the time really has come for the PC to move into the living room.